Interest on customer security deposits includible in assessable value as analogous to borrowing, added to taxable consideration. Interest accrued on security or advance deposits taken by manufacturers from buyers is includible in the assessable value of excisable goods; such deposits are treated as akin to borrowings so interest is part of the consideration and not deductible. The Board, following the Bombay High Court decision, dispenses with the need to establish a separate nexus between deposits and a reduction in sale price and modifies prior guidance that required such proof.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Interest on customer security deposits includible in assessable value as analogous to borrowing, added to taxable consideration.
Interest accrued on security or advance deposits taken by manufacturers from buyers is includible in the assessable value of excisable goods; such deposits are treated as akin to borrowings so interest is part of the consideration and not deductible. The Board, following the Bombay High Court decision, dispenses with the need to establish a separate nexus between deposits and a reduction in sale price and modifies prior guidance that required such proof.
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