Assessable value of job-worked goods excludes brand owner's advertisement , supporting waiver of pre-deposit and stay of recovery.

Advertisement and publicity expenditure incurred for a brand name owner on job-worked goods is not to be added to the job worker's assessable value, because the brand owner, not the job worker, is the beneficiary of that spending. The Board circular and supporting Tribunal and Supreme Court authorities were relied on to hold that the later definition of transaction value did not displace this principle at the interim stage. On that basis, a strong prima facie case was found and waiver of pre-deposit with stay of recovery was granted.

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Issues: Whether the appellants had made out a prima facie case for waiver of pre-deposit and stay of recovery in relation to inclusion of advertisement and marketing expenses in the assessable value.

Analysis: The order notes that the brand name owner, and not the job worker, was the beneficiary of the advertisement and publicity expenditure. It relies on the Board's Circular No. 643/34/2002-CX dated 01.07.2002, which states that where goods are manufactured on job work basis for a brand name/copyright owner, the owner's advertisement expenditure is not to be added to the assessable value. The order also refers to supporting Tribunal rulings and Supreme Court judgments and holds that the change in the definition of transaction value did not displace that principle at this stage.

Conclusion: The appellants were held to have a strong prima facie case, and waiver of pre-deposit with stay of recovery was granted.

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