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2016 (5) TMI 274 - GUJARAT HIGH COURT

2016 (5) TMI 274 - GUJARAT HIGH COURT - 2016 (337) E.L.T. 179 (Guj.) - Valuation - inclusion of pre-inspection charges in the assessable value of goods - Petitioner submitted that the Assistant Commissioner committed a serious error in confirming duty demand contrary to the decision of the Tribunal in case of the petitioner itself which is a breach of the principles of judicial discipline - Held that:- the Assistant Commissioner committed a serious error in ignoring the binding judgment of super .....

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tax effect, it was not open for the adjudicating authority to ignore the ratio of such decision. It only means that the Department does not consciously agree to the view point expressed by the Tribunal and in a given case, may even carry the matter further. - However, as long as a judgment of the Tribunal stands, it would bind every Bench of the Tribunal of equal strength and the departmental authorities taking up such an issue. An order that the adjudicating authority may pass is made app .....

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the case in consonance with the judgment of the Tribunal dated 16.06.2014 and thereafter leave it to the Departmental authorities to decide the question of filing appeal against such an order, if otherwise permissible in law. Impugned order dated 16.10.2015 is set aside. No opinion is expressed on the legal issue of includability of the predelivery inspection charges in the assessable value of the goods. - Decided in favor of assessee. - SPECIAL CIVIL APPLICATION NO. 1784 of 2016 - Dated:- 28-4 .....

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ined the writ petition on the premise that identical issue has already been decided by the CESTAT in favour of the petitioner, despite which the adjudicating authority had once again given a decision against the petitioner. 2. The petitioner manufactures and supplies submersible pumps to the Government agencies. The contracts envisage pre-delivery inspection charges by third party agency at the cost of the buyer. However, initially, the is payment would be made by the petitioner and reimbursemen .....

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rtment had placed reliance on the Larger Bench judgment in case of Maruti Suzuki India Ltd. Vs. CCE, Delhi-III, reported in 2010 (257) ELT, page No.226. However, the Tribunal distinguished the said judgment as under:- 5. Ld. A.R. has relied upon Larger Bench judgment in the case of Maruti Suzuki India Ltd. Vs. CCE, Delhi-III (Supra) wherein it has been held that PDI charges are required to be included in the assessable value. However, it is observed from this case law that the issue before the L .....

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the revenue is required to be rejected and cross objection filed by the respondent is required to be allowed. 3. When such a question again arose, the Assistant Commissioner issued a show cause notice against the petitioner why the pre-delivery inspection charges should not be included in the assessable value and resultantly unpaid dues of ₹ 1.37 lacs not be recovered. The petitioner opposed such proposals and relied heavily on the decision of the Tribunal in its own case. The Assistant C .....

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e Court of India in the case of Commissioner of Central Excise, Tamilnadu Vs. Southern Structures Ltd. 2008 (229) E.L.T. 487 (S.C.), has upheld the Tribunal decision 2002 (146) E.L.T. 678 (Tri.-Chennai), which held that cost of inspection paid to any third party in addition to the normal inspection would form Page 3 of 8 HC-NIC Page 3 of 8 Created On Fri May 06 15:44:36 IST 2016 C/SCA/1784/2016 ORDER part of the value and the amount received would be includible in the assessable value. v). The a .....

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der documents produced by the assessee. The charges which are recovered as part of transaction value cannot be separated to be on instance of the buyer. I firmly hold that any expenses made in relation to goods before being removed would add to the cost of the goods and the amount recovered from customers in the name of such costs should undoubtedly be part of transaction value and should form basis for calculation of assessable value. x). I find that the aforementioned decision in the matter of .....

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th. 4. Learned Counsel Shri Dave for the petitioner submitted that the Assistant Commissioner committed a serious error in confirming duty demand contrary to the decision of the Tribunal in case of the petitioner itself. This was in breach of the principles of judicial discipline. The Assistant Commissioner could not have ignored a binding judgment of a superior forum, when the Department accepted the judgment of the Tribunal without further appeal. Attempt to rely on the Supreme Court judgment .....

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ner due to low tax effect. This would not prevent the Department from keeping the issue alive. The Assistant Commissioner has given proper reasons for taking a different view. 6. In our opinion, the Assistant Commissioner committed a serious error in ignoring the binding judgment of superior Court that too in case of the same assessee. The principle of precedence and judicial comity are well established in our legal system, which would bind an authority or the Court by the decisions of the coord .....

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given case, may even carry the matter further. However, as long as a judgment of the Tribunal stands, it would bind every Bench of the Tribunal of equal strength and the departmental authorities taking up such an issue. An order that the adjudicating authority may pass is made appealable, even at the hands of the Department, if the order happens to aggrieve the Department. This is clearly provided under Section 35 read with Section 35E of the Central Excise Act. Therefore, even after the adjudi .....

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