2007 (1) TMI 441

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....of facts by the assessee and accordingly penalty under Section 11AC of the Central Excise Act, was also imposed. After examining the records and hearing both sides, we find that, during the period April 2000 to March 2005, the appellants were paying duty on the cars sold to their dealers, on the basis of the transaction value of the goods, which did not include the expenditure borne by the buyers for advertising the product. It appears that, for the above period, the appellants incurred a total expenditure of advertisement amounting to over Rs. 326 crores, that is, Rs. 33,000/- per car. Their dealers also advertised the product during the same period. Such advertisements were made jointly with their financiers. Apparently, the expenditure f....

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.... specifically defined under the amended provisions. 'Transaction value' so defined has an inclusive part containing a reference to 'advertising expenses'. It is this provision which has been interpreted by the lower authority for the purpose of including the above advertisement expenses of the dealers in the assessable value of the goods sold to them by the appellants from 1-7-2000. The same logic has been applied to the period prior to the said date also. Hence the demand. A line of judicial authorities is before us. The appellants are mainly relying on the apex Court's decision in the case of CCE, Baroda v. Besta Cosmetics Ltd. - 2005 (183) E.L.T. 122 (S.C.), wherein, their Lordships found, in the agreement between the assessee and their ....