TaxTMI 
TaxTMI 
2016 (3) TMI 666
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....r hearing. 2. The appellants are engaged in the manufacture of power inverters and UPS system liable to Central Excise duty. They clear goods with brand name 'Luminous', 'Safe Power' and 'TEZ'. The brand name 'TEZ' belongs to M/s SAR Silicon Systems (P) Ltd. (SAR). The brand name 'luminous was owned by the main appellant till 31.01.2004 and thereafter was purchased by SAR. The appellant sell their finished goods to 3 types of customers. a) Wholesale dealers, SAR and M/s Radiant Power Systems (P) Ltd. (Radiant) who in turn sell the goods through network of dealers all over the country; b) OEM Customers and; c) Export under the local brand name as well as brand name of overseas buyer. 3. The issue involved in....
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.... the dealers, benefit accrues both to wholesale dealers as well as the appellants. The appellants have included the expenditure incurred by them for advertisement of their own and the expenses reimbursed by them through the dealers for such advertisements. This fact has not been disputed. As far as the expenditure incurred by the wholesale dealers which is not reimbursed by the appellants, there is no need for inclusion of the said amount in the assessable value. b) The expenditure incurred by the dealers in advertisement and publicity on their own is purely optional on their part and the appellants cannot enforce any obligation for such advertisement. c) The perusal of the agreements with SAR will show in all cases where ....
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....said threshold, the appellant can charge higher price for the products. In such circumstances, the sale is not in unconditional at arms length. The quantum of money spent on advertisement and publicity by the dealer is includable in the assessable value of the goods cleared by the appellants. The argument of the appellant that the expenses incurred by the dealers were optional in nature is not acceptable. The Ld. AR contended that if a purchase of finished goods falls below prescribed volume, the price of the goods may go up. This makes the dealers obliged to incur expenditure on advertisements so that he can avoid increase in the price. 6. We have heard both the sides and examined the appeal records carefully. 7. The point for decis....
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....lso be liable to pay an additional amount to the manufacturer/ seller. In other words, the sale of the goods would not be made unless the buyer is also to pay an additional amount to the manufacturer, apart from the price of the goods. This is also supported by use of expression "by reason or" or "in connection with the sale" of the goods. The expression in connection with the sale of the goods" would only mean that but for the payment of the additional amount, the sale of the goods would not take place. When we keep in mind the aforesaid legal position, we find no error in the view taken by the Tribunal giving benefit to the assessee. Both the sides were in unison in accepting the position that no major change had been incorporated w.e.f.....
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....e legal rights" while considering inclusion of advertising expenses incurred by the marketing agent in the assessable value. The Supreme Court held that when there is a discretion as to whether or not to advertise the assessee's products, there is no "enforceable legal right" with the assessee to insist on the advertisement under the agreement. 10. In Hero Honda Motors Ltd. [2014 (324) ELT 404 (Tri. Del)], the Tribunal examined the similar issue. It was observed that the contract required the dealers to vigorously promote, develop and maintain sales of the products and parts to the satisfaction of the appellant. Such contract cannot be treated as enforceable legal right on the part of the appellant for insisting on certain quantum of the....