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M/s. Liebherr Machine Tools India Pvt. Ltd. Versus The Commissioner of Central Excise (Appeals)

Valuation - CNC Gear hobbing machine - EPCG license issued by DGFT for import of a similar item at concessional rate of duty - invalidation of EPCG license and obtaining an advance intermediate license issued to the appellant which was used by them to import parts and accessories without payment of duty - demand of differential duty by way of advance license - Held that:- the benefit accruing to the appellant by way of extending the benefit of concessional rate of duty for import of components i .....

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another customer M/s. Bajaj Auto. It may well be that the differential duty, when paid, is also available to the customer. However, on such a plea the demand itself cannot be set aside - appeal rejected - Decided against the assessee. - E/365/2007-DB - Final Order No. 21029 / 2016 - Dated:- 27-10-2016 - Shri S. S. Garg, Judicial Member And Shri V. Padmanabhan, Technical Member Smt. Rukmani Menon, Advocate For the Appellant Shri J. Harish, AR, Mr. Mohammed Yousuf, AR For the Respondent ORDER Per .....

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The customer invalidated their EPCG license and got an advance intermediate license issued to the appellant which was used by them to import parts and accessories without payment of duty. The appellant used these parts and accessories and manufactured and cleared the complete CNC machine to M/s. Bajaj Auto. The purchase order placed by the customer revealed that the agreed price was reduced to the extent of the benefit accruing to the appellant by way of import of components at concessional rate .....

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d on the following ground. (i) The duty concession on the components imported by the appellant was in the nature of a statutory benefit which is not the same as additional consideration as contemplated under Rule 6 of the Valuation Rules and hence, cannot be considered as additional price accruing to the appellant. (ii) The differential duty when paid will be available as CENVAT credit to their customer; consequently the situation is revenue neutral and consequently the demand is not justified. .....

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or the appellant and Shri J. Harish, learned AR for the Revenue. 4. The learned advocate appearing for the appellant reiterated the arguments and prayed that the appeal should be allowed on the basis of the Larger Bench s decision of the Tribunal in the Reliance Industries case on the ground of revenue neutrality. 5. The learned DR on the other hand supported the impugned order. He submitted that the decision of the apex court in the case of IFGL Refractories case (supra) supports the decision o .....

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of duty for use in the manufacture of CNC machines to be supplied to the customer. From the purchase order, it could be clearly inferred that the transaction value for the CNC machine stands depressed to the extent of benefit accruing to the appellant on account of concessional import of components. The issue for decision is whether the benefit accruing to the appellant by way of concessional import of components is to be considered as additional consideration received by them from the buyer of .....

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