TaxTMI 
TaxTMI 
2011 (5) TMI 775
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....sh Kumar The facts giving rise to this appeal are in brief as under. 2. The appellants are engaged in the manufacture of pharmaceutical products chargeable to Central Excise duty under Chapter 30 of the Central Excise Tariff Act, 1985. The period of dispute in this case is from August 2001 to March 2002. The appellant clear the goods to a warehouse at Bhiwandi from where the goods are sent to their stockiest for sale. The goods during the period of dispute were cleared from the factory on payment of duty on the value as per the provisions of Section 4 of Central Excise Act, 1944. According to the appellant during the period of dispute they were giving quantity discounts as declared in their price circulars / price lists and as per the q....
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....nce from the factory and that the appellant has shown free quantity in the depot sale invoices, but nowhere it is mentioned that the same is according to the quantity discount scheme offered by them and it is, therefore, difficult to ascertain whether free quantity mentioned in the depot invoices is under the quantity discount scheme. Against the order of Commissioner (Appeals) the present appeal has been filed. 3. Heard both sides. 4. Shri Bharat Raichandani and Ms. Anjali Hirawat, Advocates, the learned Counsels for the appellant pleaded that since the quantity discount depends upon the quantity purchased by a buyer from the depot, the same cannot be mentioned in the excise invoices issued at the time of clearance of the goods from th....
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.... quantity of discount and quantity of free supply is known only at the end of the scheme, that Rule 7 of the Central Excise Rules, 2000 makes it clear that when the goods manufactured are sold from depot, the price at which goods are sold from depot shall be the value for the purpose of levying excise duty on goods and all admissible deductions have to be given on this value, that in view of this, when ex-depot price is available, the condition that the discount should be known prior to the removal of goods can be satisfied only at depot and the department cannot insist that the quantity discount should be mentioned in the Central Excise invoices issued at the time of clearance of the goods from the factory, that the quantity discount....
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....s and perused the records. 7. During the period of dispute, the appellant had given quantity discount to their customers as per their quantity discount schemes and as per these quantity discount schemes, on buying certain quantity of goods, certain quantity of goods was offered free or in other words price charged was for quantity lesser than the quantity actually supplied, which has the effect of reducing the net sale price. The main contention of the department is that the deduction of quantity discount cannot be allowed, as the same was not mentioned in the Central Excise invoices issued at the time of clearance from the factory. This plea of the department is not correct as when the goods are first stock transferred from t....
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....taken over by this Tribunal relying upon the above mentioned judgement of the Hon'ble Supreme Court in the case of Commissioner of Central Excise vs. Goetze (India) Ltd. (supra). In view of this, if in this case during the period of dispute there were quantity discount schemes and the quantity discounts in the form of free quantity were given at the time of sale from depot, the same would have to be allowed, even if Central Excise invoices issued at the time of clearance of the goods from the factory do not mention the quantity discount, as the same can be mentioned only when the goods are sold from the depot. For permitting the deduction of quantity discount, what should be known and understood prior to sale is the quantity discount scheme....