Tribunal excludes dealer's ad expenses from assessable value, sets legal precedent on manufacturer's liability.

The Tribunal ruled that 50% advertisement expenses borne by the dealer should not be included in the assessable value of finished goods. Citing relevant case law, the Tribunal emphasized that such expenses do not constitute extra consideration to the manufacturer. The decision, delivered on 27/03/2018, favored the appellant, setting aside the impugned orders and establishing a clear legal position on the treatment of advertisement expenses in the assessable value of goods supplied by manufacturers.

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Issues:
Whether 50% advertisement expenses borne by the dealer should be included in the assessable value of the finished goods by the appellant.

Analysis:
The issue at hand pertains to the inclusion of 50% advertisement expenses borne by the dealer in the assessable value of the goods supplied by the manufacturer. The appellant's counsel referenced several judgments to support their position, including Commissioner of Central Excise, Mysore Vs. TVS Motors Co. Ltd., Hero Honda Motors Ltd. Vs. Commissioner of Central Excise, Delhi-III, and Hercules Hoists Ltd. Vs. Commissioner of Central Excise, Mumbai-III. The Revenue, represented by the Superintendents and Assistant Commissioner, maintained the stance taken in the impugned orders.

Upon thorough consideration of the arguments presented by both parties and a review of the records, the Tribunal concluded that the 50% advertisement expenses borne by the dealer should not be included in the assessable value of the finished goods. The Tribunal emphasized that since this amount does not flow to the manufacturer, it does not constitute extra consideration. Citing the precedent set by the Hon'ble Supreme Court in the case of TVS Motors, the Tribunal established that the issue has been settled, and the 50% advertisement expenses borne by the dealer are not to be included in the assessable value.

In light of the above analysis, the Tribunal set aside the impugned orders and allowed the appeals in favor of the appellant. The judgment, delivered on 27/03/2018, solidifies the legal position regarding the treatment of advertisement expenses in the assessable value of goods supplied by manufacturers.

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