TMI Blog2000 (11) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... paid product on AR-3A and also duty paid petroleum products from other manufacturers of the same appellants Company and/or other Petroleum Companies - what are called by them as 'bridging' arrangements. The imported petroleum products and the indigenous petroleum products are stored in same tanks and are being accounted for under FIFO system of material management accounting i.e. first in first out basis. The goods received under the 'bridging' arrangements are entered in the Company's own record while the imported goods received under D-3 intimation and the indigenous goods received under AR-3A are entered in the RG-1 Register maintained under the Central Excise Rules. The appellants are transferring the duty paid goods received under the 'bridging' arrangements without entering the goods physically into the tanks. These goods are normally received in the road tank lorries and are being transferred to their customers under invoice being issued by the assessee. The imported goods and the indigenous non duty paid goods are also cleared likewise under the same series of invoices by the assessee. While clearing the indigenous non duty paid goods, the assessee is discharging the duty d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the value as defined under Sec. 4 of CE Salt Act, 1944, under which the assessees are required to declare the value on which Excise duty is payable and such value shall be "normal price, thereof, that is say, the price at which such goods are ordinarily sold to a buyer in the course of whole sale trade for delivery, at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale" : (i) The assessees were clearing the goods from 1-3-94, paying Excise duty on ad valoram basis, consequent to union budget 1994-95. (ii) Verification of invoices, cash memoranda and ICCR (invoice cum cash receipt) of the assessee reveal that they have been showing the price of the goods per Kilo Litre. This price is inclusive of Excise duty. To this cum-duty price sale tax at an applicable rate is added. It is observed that they also give Dealer's Commission from the price so calculated. However, at foot note of all the invoices they have been showing the amount including the Dealers Commission. It appears that the assessees have also been realising the Dealers Commission. It is also noticed that the cum-duty price is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m to receive, store and deal with such duty paid stocks and they have not submitted any such record under Rule 5A of CE Rules, 1944 any They have also explained that the excess amount which was collected by them was due to :- (i) Railway Freight recoverable at the rates existing as 1985. The difference is between the actual freight and the freight recovered thru prices are subsidised thru MOP. (ii) Actual siding shunting charges at the loading point and at the destination as per Railways. (iii) As per the MOP Oil Companies are expected to give free delivery to Customers within 39 RTKM radius of the supply location. The actual transportation cost incurred by the Oil Companies is partially recovered thru price which forms part of the other delivery charges balance amount is born by Oil Companies. For deliveries(iv) beyond 39 RTKM transportation charges at the rate 0.18 paise per KM/KL is being recovered thru pricing as per MOP guidelines balance actual transport cost being borne by respective Oil Companies. They have further stated that Dealers Commission loaded into the assessable value is not collected but paid to the Dealers based on the rate as fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the quantum of deduction as determined by the learned Commissioner and the eligibility as per the CEGAT decision relied upon. (d) As regards the Section 11D demand being made for the period 1/97 to 4/97 he drew our attention to the amendment to Section 11D effected by the Finance Act, 2000 retrospectively and submitted that this amendment has made a major change in the liability to pay duty on the person who is liable to pay duty under the Act. Therefore, while earlier liability in the section was on every person and this liability to pay duty under the Act which has been introduced by the amendment is now also linked to the excisable goods under the Act which was not there in the earlier section. He therefore submitted that on the 'bridging' quantity they did not re-calculate any duty than what is done in the documents which they received along with the goods. (e) As regards the imported goods, they are Customs duty paid and they are not excisable goods, but the assessee/appellants are required to pay excise duty on the goods and therefore, demand under 11D for the 'bridging' quantity of the imported goods was not called for. As regards the indigenous goods bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the assessable value. 9.We have considered the submissions and the material on record and find that :; (a) As regards the demand on the 'quantum formula' suggested by the learned Sr. Counsel is rational and reasonable formula to determine the quantum of excigible goods which have been cleared from the premises, on which duty demand can be raised. This should be determined on out turn basis. If the out turns are prepared daily, this formula should be applied on daily basis and if it is monthly out turn, it should be on monthly basis. (b) As regards the assessable value, we respectfully follow the decision in the case of Bharat Petroleum Corporation - reported in 1999 (108) E.L.T. 402 and would expect the Commissioner also to re-determine the assessable value in the light of the decision of the Tribunal (supra) in the proceedings which we intend to remand for re-determination of the quantum of duty. (c) As regards retail service charges, we are in agreement with the learned Sr. Counsel. They are in the nature of retail cost incurred after clearance of the goods and are therefore, not includible under Section 4 of the CE Act, 1944. (d) As regar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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