Discount reflected in price list and later refunded was deductible from assessable value; refund claim was also within limitation.

A discount reflected in the price list and subsequently passed to the buyer through a credit note and encashed cheque was treated as actually granted, so it remained deductible from assessable value even though it was not deducted at clearance stage. For clearances made before approval of the price list, the transactions were treated as provisional, and the refund claim was not barred by limitation for the relevant period because the claim was filed within time after approval. The assessee was therefore entitled to refund of duty paid on the discounted value.

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Issues: (i) whether the discount shown in the price list but paid later through credit note and cheque was actually granted to the buyer and could be deducted from assessable value; (ii) whether the refund claim was barred by limitation in respect of clearances made before approval of the price list.

Issue (i): whether the discount shown in the price list but paid later through credit note and cheque was actually granted to the buyer and could be deducted from assessable value.

Analysis: The discount was reflected in the price list filed by the assessee and the record showed that the credit note was issued and the cheque representing the discount amount was encashed. There was no dispute that the amount was in fact refunded to the buyer, though payment was made later. On these facts, the discount could not be treated as unreal or unavailable for deduction merely because it was not deducted in the invoices at the time of clearance.

Conclusion: The discount was actually granted and was deductible.

Issue (ii): whether the refund claim was barred by limitation in respect of clearances made before approval of the price list.

Analysis: The price list was filed on 12-11-1984 and approved on 29-12-1984 with effect from 1-11-1984. Clearances made before approval were to be treated as provisional. In that situation, the period of limitation did not defeat the claim for clearances made up to the approval date, and the claim filed on 10-6-1985 was within time for the relevant period.

Conclusion: The refund claim was within limitation.

Final Conclusion: The assessee was entitled to refund of the duty paid on the discounted value, and the orders denying relief were set aside.

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