TMI Blog2008 (4) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 . Under the impugned Order, the Adjudicating Commissioner has adjudicated 23 show cause notices demanding duty for various periods from 28-9-96 to 30-9-06 and has confirmed a duty-demand of Rs. 3,78,55,491.00 (Rupees three crores seventy-eight lakhs fifty-five thousand four hundred and ninety- one) and has also imposed penalty of Rs. 1,89,97,200.00 (Rupees one crore eighty- nine lakhs ninety-seven thousand two hundred) under Section 11AC and Rs. 20,00 lakhs (Rupees twenty lakhs) under Rule 25 of the Central Excise Rules, 2001-2002 apart from demanding interest. The main allegation against the appellants is that the amount of freight and insurance collected by them in addition to the value of the goods should be included in the assessab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hri Vineet Ohri and in support of his submissions, he has cited the following decisions in support of the Department's case (i) CCE, Pondicherry v. Acer India Ltd. - 2004 (172) E.L.T. 289 (S.C.); (ii) M/s. Prabhat Zarda Factory Ltd. v. CCE - 2000 (119) E.L.T. 191(Tri-LB); (iii) Escorts JCB Ltd. v. CCE - 2002 (146) E.L.T. 31 (S.C.). 4. Learned J.C.D.R. also relies on Section 35B Order No. 59/1/2003/CX dated 3-3-2003 issued by the Board. The Department's case entirely depends on the contention that since the goods are transferred at the destination, the sale takes place there and hence, that is the place of removal. Consequently, the transport charges and insurance charges incurred till that point should be added ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons cited by the learned J.C.D.R. such as Prabhat Zarda Factory Ltd. (supra), Escorts JCB Ltd. (supra) and also on Section 37B Order No. 59/l/2003/CX dated 3-3-2003. In addition, he cites the following decisions in his support :- (i) Associated Strips Ltd. v. CCE 2002(143) E.L.T. 131; (ii) Frexton Cables Ltd. v. CCE 2002(142) E.L.T. 694; (iii) Filament India Ltd. v. CCE 2003(160) E.L.T. 314; (iv) Transformers Electricals v. CCE 2007 (213) E.L.T. 398. 7. After hearing both sides and considering their oral and written submissions, we find that such an issue is not coming up before the Tribunal for the first time. The definition of place of removal including depot etc. by the amendment made by the Finance Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and seller can have various delivery options. But the excise duty has to be independently determined in accordance with the Excise (Valuation) Rules. The constitutional mandate is for levy of excise duty on the manufactured goods. The legal provisions including the rules made for levy of excise duty cannot bring transport charges and insurance charges in the ambit of excise levy. Before amendment of Section 4 in 2000, sub-section (2) of Section 4 specifically provided that the cost of transportation from the place of removal to the place of delivery shall be excluded from the value. After amendment of Section 4 in 2000 changing the system of valuation to be based on the transaction value, Rule 5 of the Central Excise (Valuation) Rules, 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire demand confirmed by the impugned Order is relatable to a misunderstanding of the legal provisions and also to a wrong interpretation of the legal provisions which is contrary to the constitutional mandate for levy of excise duty on manufactured goods. Hence, we have no doubt in our mind that the duty demand based on inclusion of transportation and insurance charges upto the place of delivery, is not sustainable. Hence, we set aside the impugned Order including the duty-demand, demand of interest and the penalties levied. 10. As regards the Section 37B Order dated 3-3-2003 issued by the Board, the fact that both sides are relying on the same order to respectively justify such a huge demand and to challenge the very same demand ..... X X X X Extracts X X X X X X X X Extracts X X X X
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