1998 (3) TMI 619 - AT - Central Excise

Interpretation of Wholesale Prices for Scooters Sold Outside Uttar Pradesh

COLLECTOR OF CENTRAL EXCISE, KANPUR Versus LML LTD.

The Tribunal upheld the Collector's decision regarding the interpretation of wholesale prices for scooters sold outside Uttar Pradesh, stating that the ... Valuation - Wholesale price not available Issues:1. Interpretation of wholesale price for scooters sold outside the State of Uttar Pradesh.2. Determination of wholesale price for scooters sold throughout the country prior to 4-10-85.3. Consideration of the appropriate deduction for converting retail price into wholesale price.Analysis:Issue 1: Interpretation of wholesale price for scooters sold outside the State of Uttar PradeshThe case involved the interpretation of wholesale price for scooters sold outside Uttar Pradesh by an assessee engaged in manufacturing and selling scooters. The dispute arose regarding the deduction of Rs. 250 per vehicle claimed by the assessee for sales outside U.P. State. The Collector (Appeals) allowed the deduction based on a previous Tribunal decision, which was challenged by the Department. The Tribunal upheld the Collector's decision, stating that the wholesale price available in U.P. State should be considered as the wholesale price for sales outside the state. The Tribunal dismissed the Department's appeal, emphasizing that the deduction for converting retail price into wholesale price was justified based on the wholesale price available in U.P. State.Issue 2: Determination of wholesale price for scooters sold throughout the country prior to 4-10-85The controversy in the assessee's appeal related to the period before 4-10-85 concerning clearances to customers throughout the country. The Tribunal, in a remand order, held that the wholesale price available in U.P. State should also apply to clearances outside the state. However, determining the wholesale price for the period before 4-10-85 posed a challenge as the assessee did not have wholesale transactions during that time. The Tribunal considered the commission given to authorized dealers in U.P. State and concluded that a deduction of Rs. 325 per vehicle should be applied to convert the retail price into wholesale price for transactions outside U.P. State.Issue 3: Consideration of the appropriate deduction for converting retail price into wholesale priceThe Tribunal referred to previous decisions in similar cases where deductions were granted to convert retail price into wholesale price. The Tribunal differentiated the present case from those precedents based on specific evidence of discounts provided by the assessee to wholesalers in U.P. State. The Tribunal held that a deduction of Rs. 325 per vehicle should be granted for converting retail price into wholesale price, as it was the amount provided to wholesalers in U.P. State. Consequently, the Tribunal modified the lower authorities' decision and allowed the appeal in part by directing the approval of wholesale price with the specified deduction.This detailed analysis highlights the key legal issues addressed in the judgment, providing a comprehensive understanding of the Tribunal's decision in the case.