CEGAT Appellate Tribunal rules in favor of appellants on assessable value inclusion of supplier's profit

The Appellate Tribunal CEGAT, New Delhi, in 1996, ruled in favor of the appellants in a case concerning the inclusion of a supplier's profit in the assessable value of the assessee. The Tribunal held that as the job charges already encompassed profit, adding the supplier's profit was deemed unnecessary. The appeal was allowed in favor of the appellants.

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The judgment by Appellate Tribunal CEGAT, New Delhi, in 1996 (2) TMI 215, considered whether the profit of a supplier should be included in the assessable value of the assessee. The appellants manufacture polyethylene coated substrates, sometimes using raw materials supplied by customers. The Department argued that duty should be paid on the cost of raw materials plus the supplier's profit. However, the Tribunal ruled that since job charges already included profit, adding the supplier's profit was not necessary. The appeal was allowed in favor of the appellants.

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