2011 (3) TMI 1211

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.... Raigad (assessee in short) in respect of cylinders (in which the gases were supplied)  in the assessable value of gases. 3. A show-cause notice came to be issued to the assessee alleging that  they have undervalued the various gases cleared by them during the period from 01/09/96 to 30/06/2000 to the extent of Rs.88,90,198/- being the amount collected by them as fixed rental charges from the customers and they have not included the additional consideration so received in the assessable value of the various gases cleared  to the customers in contravention of Rule 173C of Central Excise Rules, 1944 read with Rule 5 of the Central Excise Valuation Rules, 1975.  The show-cause notice was adjudicated by the Additional Co....

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....s were free to take delivery in their own cylinders. He also rejected the plea of the assessee that the rental charges are the compensation for the delayed  return of cylinders. 5. The assessee  is in appeal before us against the said order of the lower appellate authority. The contention of the assessee is that the rental charges are collected for the delayed return of cylinders after the free loan period of 10 days and they have a slab rate of rent depending upon the time taken to return the cylinders. They relied upon the decision of the Hon'ble apex Court in the case of CCE Vs. Indian Oxygen Ltd., reported in 1988 (36) ELT 730 (SC) wherein the apex Court held that 'the supply of gas cylinders is ancillary to the  supp....

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....trade practice. This is an ancillary or allied venture and the gains or profits from this activity are not to be added to the assessable value of the goods. These rental charges are not includable  in the assessable value of the goods supplied  in the  container.  5.2 The assessee has also  relied upon the decision in the case of  CCE, Meerut Vs. Bisleri International Pvt Ltd., reported in 2005 (186) ELT 257 (SC),  CCE, Indore Vs. Premier Oxygen & Acetylene Co. Pvt Ltd., reported in 1985 (22) ELT 61 (Tribunal) &  CCE, Indore Vs. Indore Bottling Co., reported in 2003 (151) ELt 11 (SC)  in support of their contention that rental charges for the cylinders cannot be included in the assessable val....