TMI Blog2019 (2) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... rement of the customers was recovered from them. Therefore, these amounts cannot be included as additional consideration for sale in the assessable value of the final products. The nature of these receipts by the appellant from their customers could not be readily ascertained because there were no written agreements between the appellant and customers. As far as the remaining amount is concerned, as there is only evidence that these amounts have been collected by the appellant from their customers and there is no evidence that these amounts pertain to any other transaction between the appellant and customer we find that this is a consideration for sale of their final product. Accordingly, the demand on this account needs to be upheld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirming the demand along with interest and imposing penalties. On an appeal, the First Appellate Authority upheld the Order-in-Original. Hence this appeal. 3. Facts of the case in brief are that the appellant is a manufacturer of printed and laminated BOPP films. This film is used by their customers for packing food articles, etc. The appellant has been paying duty on BOPP film manufactured by them and cleared to their customers. Since the production of these films is specific to each customer, they use steel cylinders with copper coating engraved with the desired design for manufacturing BOPP films ordered by each customer. Scrutiny of the assessee s records showed that during the period 4/2011 to 3/2014 the appellants had raised de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he question of extended period of limitation, it was held that unless these amounts are established to be liquidated damages it cannot be said that longer period of demand does not apply. 4. During the denovo proceedings, the appellant produced letters from their clients giving details of the debit notes which were raised on them by the appellant and the reason for raising them. These letters covered not the entire demand but some portion of it. Of all the letters which were submitted some had indicated that the amounts were towards the liquidated damages while others had not. Both the lower authorities had not accepted these letters in the denovo proceedings and confirmed the demands along with interest and imposed penalties as original ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Not indicating damages Total ₹ 1,47,266 The appellant showed evidence but the Department has not considered the same. Department has confirmed the demand only on the strength of statement of the Managing Director and mere presumptions that the amounts collected by them were towards the sale of their products. In para 20 of the order of Adjudicating Authority, the debit note dated 16.11.2002 raised on M/s Ravi Food Limited was referred and it was wrongly inferred that these were related to the excisable goods. The letter by M/s Ravi Food Limited clearly stated that the cylinders referred to in the debit note that the charges were towards liquidated damages for discarded cylinders. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e final products as per the price which they received for the final products. In addition to that, the appellant also received some amounts by raising debit notes from their customers. It is not in dispute that these debit notes were raised towards cost of the cylinders. It is the case of the Revenue that the cost of the cylinders which the appellant charged from their customers should part of the assessable value being the additional consideration for sale of the BOPP films (since the cylinders are made for each customer). It is the case of the party that the amounts which they covered through debit notes do not part of the assessable value as they are not additional consideration for their sale of the product. On the other hand, these amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the first appellate authority have not given any relief to the appellant in respect of the demand raised. In our considered view since the entire demand is raised based on the available information, the letters which were submitted by the appellant s customers should also have been considered and wherever the debit notes reflected the debit notes were towards liquidated damages such amounts cannot be included as additional consideration for sale of final products. Accordingly, we hold that of the total value of ₹ 43,11,997/- collected by the appellant through various debit notes, an amount of ₹ 35,96,060/- needs to be deducted as these amounts clearly pertain to liquidated damages and are not related to sale of goods. As far ..... X X X X Extracts X X X X X X X X Extracts X X X X
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