2015 (9) TMI 1619

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....pellants are vendors of M/s. Tata Motors who manufacture various autoparts on the basis of drawings, designs & specifications supplied by M/s. Tata Motors. That Since the appellants are not charging any amount on account of Drawing & designs cost (D & D Cost), therefore the same are not required to be included in the cost of parts manufactured by the appellants. That both the appellants & M/s. Tata motors were approached by the Revenue to provide the demand of D & D cost. That even M/s. Tata could not Motors express any opinion on the issue but agreed to provide D & D cost as a percentage of total expenditure of Jamshedpur plant. That as per this calculation given by M/s. Tata Motors the D & D cost element worked out to 0.085% of the total ....

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.... that this bench while passing final orders dt. 16/12/08 made following observations while holding that 0.085% of cost of component has to be added while arriving of the assessable value of the components manufactured by appellants:- After careful consideration of the case records as well as the submissions from both sides, we note that the cited decision of the Tribunal though under the earlier provision of law, did hold that the cost of drawings is not includible in the assessable value. Moreover, investigation has not brought out any evidence that a large number of vendors, who are the manufacturers, and who are responsible for paying the duty on the components manufactured by them, had knowledge that some expenditure was made i....

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....mount for the normal period in each case. Since we have held that there is no suppression, misstatement etc, the additional duty to be paid by the Respondent Vendors would also be admissible for taking credit by M/s. Tata Motors to whom the components have been supplied. As we have ordered confirmation of the demands for the normal period holding that the escapement of duty has arisen on account of ignorance of law on the part of the Assessees as well as the Departmental Authorities alike, there is also no justification for imposition of penalties on any of the Respondents. The interest on duty applicable for the normal period of demand would however, be payable in accordance with law. 1.2 In view of the foregoing, we set aside both the ....