1998 (8) TMI 253 - AT - Central Excise

Appellate tribunal favors appellant on dealer and advertisement expenses inclusion in assessable value.

SHRI RAM HONDA POWER EQUIPMENT CO. Versus COLLECTOR OF C. EX., MEERUT

SHRI RAM HONDA POWER EQUIPMENT CO. Versus COLLECTOR OF C. EX., MEERUT - 1999 (107) E.L.T. 145 (Tribunal) Issues:1. Inclusion of expenses incurred by the dealer in the assessable value.2. Inclusion of advertisement expenses in the assessable value.Analysis:1. The first issue in this appeal pertains to the inclusion of expenses incurred by the dealer in the assessable value. The appellant, engaged in the manufacture of portable gensets, argued that certain expenses should not be included based on precedents like the decision in Philips India Ltd. v. CCE, Pune. The appellant's dealers added a margin to the purchase price and undertook after-sales service. The Supreme Court's decision in the Philips India Ltd. case highlighted that advertisement and after-sale services provided by dealers under an agreement are not includible in the assessable value. The Court noted that such services benefit both the manufacturer and the dealer, enhancing the product's value and sales opportunities. Consequently, the Tribunal accepted the appellant's contentions based on the established legal principles and allowed the appeal.2. The second issue concerns the inclusion of advertisement expenses in the assessable value. The appellant contended that the expenses incurred under a joint publicity scheme should not be included, citing relevant legal precedents. The Tribunal, after considering the submissions from both sides and examining the records, found that the issues raised were already addressed in previous decisions. Relying on the established legal principles and precedents, the Tribunal accepted the appellant's arguments regarding the advertisement expenses. Consequently, the Tribunal allowed the appeal on this issue without delving into other matters raised by the parties, as the key concerns were adequately addressed based on existing legal interpretations and judgments.In conclusion, the appellate tribunal, following established legal precedents and principles, ruled in favor of the appellant on both issues related to the inclusion of dealer expenses and advertisement expenses in the assessable value. The decision was guided by the interpretations of relevant case law, particularly the Supreme Court's rulings in similar matters. The judgment highlighted the mutual benefits derived from dealer services and emphasized the non-inclusion of certain expenses in the assessable value based on legal reasoning and precedents.