TaxTMI 
TaxTMI 
2015 (9) TMI 461
X X X X Extracts X X X X
X X X X Extracts X X X X
....excise duty only on the price of the goods and not included therein the freight paid which was reimbursed by the customer. 2. The dispute in this appeal is with regard to clearances of goods covered by (c) above. According to the Revenue, the amount of freight shown separately in the invoice will form part of the price of the goods to arrive at the assessable value under Section 4 of the Central Excise Act, 1944 while the appellants contend that freight cannot be added to the price of the goods to arrive at the assessable value of the goods. According to Revenue, goods are not sold at the factory gate but at customer's premises and hence transaction value would include the freight element also. 3. Section 4 of the Central Excise Act, 1944 effective from 1-7-2000 reads as follows : "4. Valuation of excisable goods for purposes of charging of duty of Excise. - (1) Where under this Act, the duty of Excise is chargeable on any excisable goods with reference to their value, then, on each removal of the goods, such value shall - (a) in a case where the goods are sold by the assessee, for delivery at the time and place of the removal, the as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory; from where such goods are removed; (cc) 'time of removal', in respect of the excisable goods removed from the place of removal referred to in sub-clause (iii) of clause (c), shall be deemed to be the time at which such goods are cleared from the factory; (d) 'transaction value' means the price actually paid or payable for the goods, when sold, and includes 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 reason of, or in connection with the sale, whether payable at the time of the sale or at any other time, including, but not limited to, any amount charged for, or to make provision for, advertising or publicity, marketing and selling organization expenses, storage, outward handling, servicing, warranty, commission or any other matter; but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods." 4. Ld. Advocat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d be found that the LRs are made in the appellant's name and all the risk from the factory to the customer's premises are on appellant's account only and it is due to this reason that in respect of clearances covered by category (b) that they are paying Central Excise Duty on the total contract value which includes freight upto the customer's premises while in respect of category (c) they are not claiming the credit of Service Tax paid on the transportation charges. Learned Advocate also stated that in respect of the consignments covered by category (b) they are claiming credit of Service Tax paid on the transportation services upto the customer's premises. Learned Advocate also contended that even Rule 5 of the Central Excise Valuation Rules, 2000 were amended in 2003. Earlier only actual freight was deductible but after amendment even average of freight is allowed to be excluded. Learned Advocate relied upon the following judgment to support various contentions. (i) Commissioner of C. Ex., Nagpur v. Ramkrishna Electricals Pvt. Ltd. - 2011 (272) E.L.T. 149 (Tri.-Mumbai) (ii) Mercedes Benz India Pvt. Ltd. v. Commr. of C. Ex. Pune-I ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nts towards freight were separately indicated. It is the submission of the learned Advocate for the appellant that in both the cases ownership of the goods rested with them till the goods were delivered to the customers at the premises of the customers and that the risk like damage, loss of the goods in transit was also that of the appellant. Under these circumstances, he submits that the conditions in Board's Circular No. 97/8/2007-S.T., dated 23-8-2007 are satisfied in their case and the transportation involved till delivery of the goods to the customers has to be considered as input service. He also relies on the decision of the Hon'ble High Court of Punjab and Haryana in the case of Ambuja Cements Limited v. Union of India reported in 2009 (236) E.L.T. 431 (P & H) = 2009 (14) S.T.R. 3 (P & H)". Learned A.R. also drew support from Board's 37B Order No. 59/1/2003-CX, dated 3-3-2003 which deals about the includibility of freight and insurance charges. 6. We have carefully considered the rival submissions. The issue is relating to transaction value of the goods, whether or not the transaction value will include the freight charges which are shown in the invoices and collecte....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... it is clear that, Cenvat credit on all the services received till title of the goods passes on to the buyer is available to the manufacturer. In our case Domestic clearances are made on FOR destination basis (sample copies of few L/R (lorry receipts) are enclosed as Exhibit-A) showing freight has been paid us), where freight is being paid by us to the transporters for transportation of goods up to the buyers place as per terms of sale and contract (Copies of few purchase orders/contracts are enclosed as Exhibit-B) and the title in goods is with us till the delivery is being made by the transporter to the buyer as the losses on account of shortages or other losses in transit if any are to be borne by us as we have taken marine insurance policy for transportation of goods (Copy of marine insurance policy is enclosed as Exhibit-C), further the freight is integral part of prices charged in Invoices on which Central Excise duty is paid (Copy of few invoices are enclosed as Exhibit-D). Therefore, the above said conditions are satisfied in terms of the above referred circular issued by C.B.E. & C., hence we are entitled to avail Service Tax credit on GTA service availed for transportatio....