TMI Blog2023 (12) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... dered in favour of the appellant in the interim order in M/S HARIT POLYTECH PVT. LTD. VERSUS COMMISSIONER, CENTRAL EXCISE CGST- JAIPUR I, GANPATI PLASTFAB LTD., M/S APEX ALUMINIUM EXTRUSION PVT. LTD., M/S MAHA MAYAY STEELS, M/S. TIRUPATI BALAJI FURNACES PVT. LTD., M/S. TRANS ACNR SOLUTIONS PVT. LTD., M/S. FRYSTAL PET PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, CUSTOMS CGST- ALWAR [ 2023 (3) TMI 1120 - CESTAT NEW DELHI ] on a difference of opinion having arisen between two learned Members of the Division Bench of the Tribunal, where it was held that The subsidy amount, therefore, cannot be included in the transaction value for the purpose of levy of central excise duty under section 4 of the Excise Act. Thus, the contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid was remitted as subsidy by the Industrial Department of State Government to the Commercial Department for adjusting against the Tax liability of the subsequent year, on behalf of the appellant; and (b) Sale tax actually paid or actually payable was specifically excluded from the transaction value in terms of section 4(3)(d) of Central Excise Act. 3. The appellant setup a new unit in Mandideep coming under Raisen District in the State of Madhya Pradesh for manufacture of parts of transformers and availed the benefit of the Industrial Investment Promotion Assistance under the Industrial Promotion Policy [the Promotion Policy] announced by Government of Madhya Pradesh. 4. Under the said the scheme, subject to fixed capital in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant filed a detailed reply to the show cause notice denying the allegations but the Principal Commissioner, by order dated 31.12.2018, confirmed the demand with interest and penalty. 9. In the present case, the appellant invested Rs. 3101.70 lakhs in Mandideep coming under Backward 'C' District and hence the maximum amount of assistance permissible was upto the said total investment, subject to payment of sales tax. It needs to be noted that 75% of the total sales tax paid was allowed by State Government as subsidy which was adjustable against the tax liability of subsequent years. It is not a case of exemption of VAT/CST or refund of VAT/CST, but is a methodology followed for measurement of the quantum of disbursement of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lan. What has been retained by the appellant is basically the subsidy amount and it is not the case of the Department that subsidy amount has to be included in the transaction value. ***** 25. Merely because subsidy is computed with reference to the tax paid and is a percentage of the tax paid, will not mean that it is directly or indirectly related to the sale of goods and would be an additional consideration. The amount of subsidy to be provided has necessarily to be a definite amount. It could either be a fixed amount or it could depend on certain factors and one factor can be percentage of the tax paid. This would encourage investors to increase commercial production so that they are able to receive more subsidy, but this can p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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