TaxTMI 
TaxTMI 
2014 (4) TMI 650
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.... in course of examination of the respondent's records for the period from 2000-2001 to 20001-2002, pointed out that while the respondent are collecting the charges from their customers for testing of Tonners, they are not including these charges in the assessable value of Chlorine being sold by them. Accordingly two Show Cause Notices were issued for demand of Central Excise duty of Rs. 94,264/- and 67,792/- for the period from 01.07.2000 to 29.02.2004. The Show Cause Notices were adjudicated by the Assistant Commissioner by a common Order-in-Original dt. 09.09.04 by which the duty demands, as mentioned above, were confirmed along with interest and penalty of equal amount was imposed on the Respondent under Rule 25(1) of the Central Excise Rules. In course of proceedings before the Assistant Commissioner, respondent pleaded that the testing charges are being charged only in those cases where the Chlorine is supplied to the customers in the Tonners brought by them and request is made by the customers for Hydraulic testing, as the Tonners have to undergo Hydraulic testing as per the law and that for this reason, the testing charges for Tonners being charged by the Respondents from ce....
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.... not includible in the assessable value of the Chlorine, are not correct . 4. Ms. Surbhi Sinha, Advocate, the learned counsel for the Respondent, defended the impugned order by reiterating the findings of Commissioner (Appeals) and emphasized that from the very beginning, the stand of the respondent has been the hydraulic testing charges are charged only when liquid chlorine is supplied by them in the Tonners brought by the customers, and testing of the customers tonners is done on their request, that the testing of the Tonners belonging to customers on their request is an activity which has no link to the sale of Chlorine to them and hence testing charges in such cases charged from the customers, cannot be said to be for the reason of or in connection with sale of the Chlorine, that in any case, the issue involved in the present case stands decided by the Tribunal in the Respondents favour in case of CCE Ludhiana Vs. Punjab Alkalis & Chemicals Ltd. , reported in 2004(168) ELT-82(Tri.-Del.), that the same view has been taken by the Tribunal in case of Harshita Handling Vs. CCE, Bhopal, reported in 2010(19) STR-596 (Tri.-Del.), and that in view of the above, there is no infirmi....
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.... 01.07.2000, under Section 4(1)(a), the assessable value of the goods, on each removal, shall, in a case where the goods are sold by the assessee, for delivery at the time and place of removal to unrelated buyers and price is the sole consideration for sale, is the Transaction value. The term 'transaction value' is defined in Section 4(3)(d) as under:- the price actually paid or payable for the goods, when sold and include in addition to the amount charged as price, any amount that the buyer is liable to pay to, or on behalf of the assessee, by the reason of, or in connection with sale, whether payable at the time of sale or at any other time, including, but not limited to any amount charged or to make provision for, advertising or publicity, marketing and selling organization expenses, storage, outward handling, servicing, warranty, commission or other matters, but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid. 5.1 In our view, the words any amount that the buyer is liable to pay to or on behalf of assessee for the reason of or in connection with sale would ....
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.... CCE Vs Superior Products (Supra) is also applicable to Section 4, as it stands w.e.f. 01.04.2000, as the Apex Court in para 51 of its judgment in case of Bombay Tyre International (Supra) has held that the statutory provision regarding inclusion of packing charges calls for strict construction, as levy is sought to be extended beyond the manufactured article itself and accordingly the cost of only that packing would be includible in the assessable value which is necessary to make the goods marketable and this principle would be applicable while interpreting the provision of Section 4, as it stands w.e.f. 01.07.2000, as the nature of the levy of Central Excise duty has not changed. Therefore, if some goods are marketable without being put into the containers, the cost of containers including their testing charged would not be includible in the assessable value. 6. In this case, the fact that liquid Chlorine manufactured by the Respondent is being sold by them either in their own tonners or in the customers tonners or even through pipeline, shows that Chlorine is marketable as such. It is also not disputed that testing is optional and the testing charges have been charged only i....