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2017 (1) TMI 292 - CESTAT CHANDIGARH

2017 (1) TMI 292 - CESTAT CHANDIGARH - TMI - Valuation - extra consideration received by the appellant on account of transit insurance was to be added in the assessable value or not? - Held that: - reliance was placed in the appellant's own case JCT LIMITED Versus COMMISSIONER OF CENTRAL EXCISE, JALANDHAR [2013 (9) TMI 492 - CESTAT NEW DELHI], where it was held that The price charged at the time of removal was not the sole consideration for transaction of sale. The adjudicating authority and the .....

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X[DB] - Dated:- 20-12-2016 - Mr. Ashok Jindal, Member (Judicial) And Mr. Devender Singh, Member (Technical) Sh. Sandeep Sachdeva, Charted Accountant for the Appellant Sh. V. Gupta, A.R. for the Respondent Per Ashok Jindal The appellant has filed this appeal against the impugned order wherein the extra consideration received by the appellant on account of transit insurance was to be added in the assessable value and therefore demanding duty thereon along with interest and imposing penalty on the .....

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to appreciate the rival contentions, it would be useful to have look upon the relevant provisions of law dealing with valuation of excisable goods for the purpose of charging excise duty. 9. Section 4 (1) in the Central Excise Act, 1944 reads thus: Valuation of excisable goods for purposes of charging of duty of excise. (1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to their value, then, on each removal of the goods, such value shall (a) in a cas .....

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the price actually paid to him for the goods sold and the money value of the additional consideration, if any, flowing directly or indirectly from the buyer to the assessee in connection with the sale of such goods, and such price-cum-duty, excluding sales tax and other taxes, if any, actually paid, shall be deemed to include the duty payable on such goods.] Section 4(3) of the Central Excise Act, 1944 deals with the definition for the purpose of section 4 and defines place of removal and time o .....

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emoved; [(cc) "time of removal", in respect of the excisable goods removed from the place of removal referred to in sub-clause (iii) of clause (c), shall be deemed to be the time at which such goods are cleared from the factory;] (d) transaction value means the price actually paid or payable for the goods, when sold, and includes in addition to the amount charged as price, any amount that the buyer is liable to pay to, or on behalf of, the assessee, by reason of, or in connection with .....

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of removal and time of removal. The dispute in this appeal is regarding valuation of the goods cleared during disputed period for the purpose of excise duty. 11. on reading of section 4(1) reproduced above, it is evident that general rule for fixing transaction value of the goods cleared is the price charged in delivery at the time of and place of removal. This, however, is subject to the condition that the assessee and the buyer of the goods are not related and the price is the sole considerati .....

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6.17 Lakhs against transit insurance premium. This imply that the appellant has charged more than 300% of the transit insurance premium from his buyer. Thus, transaction on the face of it is highly unnatural and is against the norms of the trade practice. The only inference which can be drawn from such an abnormal transaction is that the price paid at the time of delivery was not the sole consideration for sale and the appellant with the aid of buyers have evaded excise duty by issuing invoices/ .....

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lted. 12. The judgment relied upon by the appellants in the matter of Baroda Electric Meters Ltd. (Supra) is a short judgment and therefore, it would be appropriate to reproduce the same. 1. The Tribunal accepted the position that equalised freight was charged by the appellant from everyone, but proceeded to say that even though freight cannot be a part of the assessable value that wherever freight actually paid was less than the amount collected by way of freight and transportation charges the .....

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llowed and the impugned judgment of the Tribunal is set aside. The legal position which emerges from the aforesaid judgment is that the duty of excise as a tax on the manufacturer and not a tax on profit made by a dealer on transportation or insurance etc. This judgment however has not considered and analysed the scope of section 4(1)9a0 which provides that sale price at the time of removal of goods is transaction value for the purpose of charging excise duty with rider that the assessee and the .....

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