Assessable value for central excise excludes unproven after-sale service and dealer reimbursement additions; duty demand and penalty fail.

After-sale service expenses and dealer reimbursement were treated as not includible in the assessable value for central excise duty where the assessee had not received any amount over and above the machine price from customers. The text states that the show cause notice and impugned order failed to establish any additional consideration, and the Department did not produce evidence that after-sale service costs lay outside the assessable value. In the absence of such proof, the duty demand was not sustainable, and the connected penalty also failed.

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Issues: Whether the amounts related to after-sale service and dealer reimbursement were includible in the assessable value for central excise duty, and whether the consequent duty demand and penalty were sustainable.

Analysis: The assessee had not received any amount over and above the price of the machines from the customers. The show cause notice and the impugned order did not establish that any additional consideration had been collected. The Department also did not adduce evidence to show that the after-sale service expenses were outside the assessable value. In the absence of proof by the Department, the demand could not be sustained.

Conclusion: The duty demand and penalty were not sustainable and were set aside.

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