TaxTMI 
TaxTMI 
2019 (5) TMI 955
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....rkhand State during the relevant period with interest and penalty. On adjudication, the demand was confirmed with interest and penalty. Aggrieved by the said order, they filed an appeal before the learned Commissioner (Appeals), who in turn, allowed their appeal. Hence, the Revenue is in appeal. 3. Learned AR for the Revenue reiterating the grounds of Appeal has submitted that the Water Resource Department and Minor Irrigation Department of Jharkhand State floated a tender for purchase of specified variety of pipes and fittings for Micro Lift irrigation Schemes under Minor Irrigation Divisions of Jharkhand State. The respondent's marketing office at Kolkata participated in the tender. In the tender, various conditions were required to required to be fulfilled which included that only manufacturer or authorized representative/trade distributors are eligible for participation in the said tender. On approval of the tender, the respondents were required and asked to deposit a security amount with the Water Resource Department. Consequently, the Respondent had submitted Bank Guarantee of Rs. 10.00 lakhs as security deposit. The Jharkhand Govt., in accordance with the tender, directed ....
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....termining the assessable value for payment of excise duty. All these aspects have been considered by the adjudicating authority and demand was confirmed accordingly. Since the respondent had suppressed the facts about the correct transaction value of pipes supplied as per the contract with Jharkhand Govt., extended period is invocable and penalty equivalent to the duty is chargeable. 4. Per contra, the learned Advocate Shri T.C. Nair for the respondent has submitted that the Minor Irrigation Department of Jharkhand Govt. floated tender with condition that participants of tender should have turnover of more than Rs. 250.00 crores, sufficient network of dealers throughout the State and the manufacturer should provide quality assurance of the product and timely supply of the product by the dealers and distributors; also should be required to make security deposit of Rs. 10.00 lakhs to ensure the compliance of the said conditions. It is his contention that the qualifying criteria prescribed for competing the bid is for manufacturer on behalf of dealers/sub-dealers; and they have submitted the list of dealers/sub-dealers to the State of Jharkhand, who would be ultimately supplying the....
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....nt to the dealers directly and no additional consideration whatsoever was flown back to the respondent from the dealers. Thus as per Section 4(3)(d) of Central Excise Act, 1944, the transaction value of the price actually paid or payable for the goods at the time of place of removal should be basis for determination of assessable value. Since the dealers have not paid anything extra other than the price shown as invoice raised, hence, it is to be considered as a correct transaction value. The pipes were not supplied by the dealers to the Jharkhand Govt. for and on behalf of the respondent as wrongly observed by the learned Commissioner in the impugned order. 7. Further, he has submitted that the ex-factory price of Rs. 88.10 declared on oath before the Hon'ble Jharkhand High Court was excluding the normal trade discount and if discount is allowed from the said price, the assessable value would be around Rs. 48.00 per meter. It is their contention that averments made in the Affidavit before the Hon'ble Jharkhand High Court defending the Writ Petition cannot be taken as adverse ground against the respondent in the present case as both proceedings are independent and separat....
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....ans 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 the sale, whether payable at the time of the sale or at any other time, including, but not limited to, any amount charged for, or to make provision for, advertising or publicity, marketing and selling organization expenses, storage, outward handling, servicing, warranty, commission or any other matter; but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods.] 8. This Tribunal has already considered more or less similar facts and circumstances in Bright Drugs Industries Ltd.'s case - 2016 (343) ELT 1092 (Tri). In the said case, M/s Bright Drug Industries Ltd. was engaged in the manufacture of pharmaceuticals product and P&P medicaments, entered into rate contract with the Maharashtra Govt. as also with some other govt. agencies for supply of medicaments on an agreed price in response to the tender floated by the said govt. agencies. Medicaments were required to be floated ....
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....contracted price. In such a scenario, to en route the medicaments through a third agency, in respect of the same contracted goods is nothing but a modus operandi adopted by the manufacturer to evade payment of duty. We have already observed that M/s. Anupam cannot be held to be having a status of distributor, the appellants' contention of adopting the transaction value between the two in terms of the provision of Section 4(1)(a), has no weightage inasmuch as Section 4(1)(a) would not be applicable in such a scenario, the transaction being not on principal to principal basis. The fact that the goods stands supplied directly by the manufacturer and it is only the invoices which are initially being raised by them in the name of M/s. Anupam, who are further raising the invoices in the name of the Government hospital is indicative of the cleverly adopting the fictitious route by the manufacturer. Even if viewed from another angle, the part of the goods which stand directly supplied by the manufacturer to the Government hospital having been assessed at the contracted price, a part of the goods in respect of the same very contract cannot be allowed to be assessed on a different assessable....