9911796707
TMI Blog2017 (5) TMI 448X X X X Extracts X X X X X X X X Extracts X X X X ..... at Credit of duty paid on inputs, capital goods and input services. Accordingly the Commissioner (A) has confirmed duty demand amounting to Rs. 74,89,162/- & Rs. 46,43,409/- vide impugned orders along with interest and levy of penalties on "operational compensation" received from their customers. 2. During the course of audit of records & Accounts of the appellant for the period 2006-07, it was observed on verification of Balance Sheet that an amount of Rs. 1.18 crores and Rs. 1.14 crores has been shown as other income during 2005-06 (upto December, 2005) & 2006-07 (upto December, 2006) respectively which was recovered from the customer as "operational compensation". It is alleged that the recovery of amount from the customers as operation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Eicher. Since the appellant has made investment in setting up of the plant, minimum rate of return was guranteed by M/s. Eicher through the agreement entered into with the appellant. In terms of the agreement M/s. Eicher is liable to compensate for any short fall in the quantum of goods ordered so as to ensure minimum guaranteed return on investment. 7. The Ld. Counsel further submitted that since the amount received by the appellant is by way of compensation and is not towards the sale or supply of goods, in such a case no duty can be demanded on such amounts received in terms of section 4 of the Central Excise Act. 8. He further relied upon the decisions in the case of CCE Belgaum v. Praxair India Ltd. 2008 (223) ELT 596 (Tri-Chenn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th reference to the compensation amount received by the appellant. 13. We are of the view that such amounts cannot be considered as additional consideration for the goods actually sold. This view finds support in the decisions of the Tribunal relied upon by the Counsel for the appellant. We find that in the decisions in the case of Praxair India Ltd. (supra)as well as Jindal Praxair Oxygen Co. Ltd. (supra), similar issue has been considered and decided in favour of the manufacturer. In the case of Praxair India Ltd. (supra) the Tribunal has held as follows: "3. After hearing both sides and considering their submissions, we note that, in a similar case, this Tribunal has held that MTOP charges paid by the buyer to the assessee on account o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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