Tribunal excludes breakage & insurance charges from assessable value under customs law

The Tribunal ruled in favor of the assessee, holding that the breakage and insurance charges collected should not be included in the assessable value under customs law. The Tribunal emphasized that unless these charges are proven to be related to the cost of goods disguised as transportation or insurance charges, any excess amount collected should not be considered in the assessable value. The decision aligned with previous Supreme Court precedents and Tribunal decisions, ultimately rejecting the revenue's appeal.

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The dispute concerned collection of Rs.1.00 per sq. meter per MM as "breakage and insurance charges" and whether such charges are "includible in the assessable value." The Deputy Commissioner treated the amount as part of assessable value because particulars of breakage were not shown. The Tribunal held that insurance charges to cover loss or damage during transit are "in the nature of cost transit" and are not to be included in assessable value. The revenue relied on C.C.E., Meerut v. Surya Roshni Ltd. ("compensation given to the customers for breakage or losses of the goods in transit is includible in the assessable value"). The Tribunal distinguished that decision: reimbursement of actual cost for breakage cannot be deducted where it represents cost of the goods, but here the collection was specifically for insurance/transport and there was no allegation it represented cost of goods. Following Baroda Electric Meters Ltd. v. Collector of Central Excise and later tribunal authority, charges not shown to be a guise for price of goods are not includible. Revenue appeal dismissed.

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