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2016 (9) TMI 1173 - CESTAT ALLAHABAD

2016 (9) TMI 1173 - CESTAT ALLAHABAD - 2016 (341) E.L.T. 404 (Tri. - All.) - Valuation - includability - freight incurred in transportation of goods manufactured - post clearance from the factory to the place or site of the buyers - Held that:- it is evident that the goods have been delivered to the buyer at the factory gate as is evident from the invoice and the purchase Orders by reading together. In the invoices, the appellants have charged sales tax and have also reflected the freight separa .....

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he appellant, shall not be valued under Section 4(1)(a) but under Section 4(1)(b). We hold that the valuation shall be done in the appellants case only under Section 4(1)(a), as explained by Hon'ble Supreme Court in the case of C.C.E. Mumbai Vs. Official Liquidator for Brimco Plastic Machinery Pvt. Ltd. [2015 (10) TMI 2281 - SUPREME COURT]. - Decided in favour of appellant with consequential relief - E/70132/2016-EX[DB] - Final Order No.70634/2016 - Dated:- 4-8-2016 - Mr. Anil Choudhary, Member .....

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transportation of goods manufactured, post clearance from the factory to the place or site of the buyers. 2. The brief facts are that the show-cause-notice dated 08.08.2014, was issued for the extended period from 2009-10 to 2013-14, alleging that the Revenue Audit pointed out that as per the relevant purchase order in invoices, the appellant have supplied their goods namely, Air Handling Unit, in complete knock-down condition to the premises of buyer. Appellants have assembled the AHU, and aft .....

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e premises of the buyers. Further, in this way, ownership of the subject goods remained with the appellant till delivery and installation of the AHU at the buyer's premises. Accordingly, the place of removal of goods in terms of Section 4(1) of the Act, is the buyer's premises. Further, on scrutiny of Ledgers and invoices of the appellant, it was found that the appellant has been discharging freight on the AHU from their unit upto the premises of buyers, but they are not including the fr .....

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on of goods from the factory of the appellant to the premises of the buyers, is includible in the assessable value or not. 4. The facts, which are not in dispute, is that the appellant manufactured most of the components of the AHU. Some components are bought and brought in the factory and used in the manufacture of AHU, which is cleared on payment of duty. The learned Counsel for the appellants has taken us through some of the purchase orders, wherein one purchase order of Gland Pharma Ltd. dat .....

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entioned 10% advance BG, 80% against proforma invoice after inspection before dispatch, 10% after delivery and subject to performance BG for one year. Further, in the delivery terms, it is mentioned freight at actual. Similarly, in the purchase order of NTPC Ltd., under the column of inspection, it is mentioned NTPC shall collect the material from vendor's premises and freight charges, it is mentioned will be borne by NTPC and further providing for inspection at source-Dadari (i.e. workshop .....

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and not the premises of the buyers. It is further evident from the copy of sample invoices, that freight have been charged separately in the invoices. The counsel is also relying on the ruling of the Hon'ble Supreme Court in the case of C.C.E. Mumbai Vs. Official Liquidator for Brimco Plastic Machinery Pvt. Ltd., reported at 2015(09) LCX 0057, wherein also the Hon'ble Supreme Court in the case of the assessee, manufacturing and clearing Plastic Machinery and installing and commissioning .....

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ontract basis and recovering the contract price by raising invoice. The Revenue wanted to add certain cost incurred towards installation, erection, etc. for arriving at the transaction value. The apex Court held that the Tribunal was correct in holding that the expenses of installation is not includible in the transaction value, as it is obvious conclusion on reading of Section 4 of the Act. As per which, the transaction value is to be arrived at the time of clearance of the goods at the factory .....

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