TaxTMI 
TaxTMI 
2020 (12) TMI 1056
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.... the buyers and in such cases freight was paid by the appellant but recovered from the buyers. According to the appellant, the freight was also separately mentioned in the invoices. The appellant paid duty on the assessable value without including the value of freight, as according to the appellant, freight was incurred beyond the place of removal which is the factory gate of the appellant. 3. The Department, however, believed that the premises of the buyers' would be the place of removal and, therefore, the freight paid for delivery of goods at such place of removal would be includable in the assessable value. 4. Accordingly, a show cause notice dated February 12, 2018 was issued to the appellant proposing a demand of central excise duty alleging that the freight separately charged on the invoices is includable in the assessable value. The appellant filed a reply to the show cause notice. The Assistant Commissioner, however, by the order dated February 27, 2019 confirmed the demand under section 11A(4) of the Central Excise Act, 1944 [the Excise Act ] with interest under section 11AA and penalty under section 11AC of the Excise Act. 5. Feeling aggrieved, the appellant fil....
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....dered and distinguished by the Supreme Court in Ispat Industries; (iv) Reliance has also been placed on the following decisions of the Tribunal on the issue that freight charges are not includible in assessable value for ex-works sales : (a) Commissioner of GST & Central Excise, Jaipur Vs. M/s Dynamic Cables Pvt. Ltd. [2019 (7) TMI 783-CESTAT-New Delhi] (b) M/s Sharda Ceramics Pvt. Ltd. Vs. Commissioner of Central Excise, Jodhpur [2018 (8) TMI 732-CESTAT-New Delhi] (c) Commissioner of GST & Central Excise, Jaipur Vs. M/s Tirupati Plastomatics Pvt. Ltd. [2018 (8) TMI 1784-CESTAT-New Delhi] (d) Bikaner Ceramics Pvt. Ltd. Vs. CCE & CGST, Jodhpur-I [Final Order No. 52856-52858/2018 dated 10.8.2018] (e) Prakash Packaging Vs. CCE & ST, Bhopal [2018 (2) TMI 909-CESTAT-New Delhi] (f) Contimeter & Electrical Vs. CCE, New Delhi-1 [2018 (9) GSTL 382 (Tri.-Delhi)] (v) Payment of transit insurance by the appellant and payment of charges for goods lost in transit is not an important factor to determine the 'place of removal' in view of the Circular dated October 20, 2014 issued by the Central Board of Excise & Customs; ....
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....issioner, however, found that the buyer could recover the amount for any shortage found at the time of delivery from the appellant and insurance expenses to cover the goods in transit were also borne by the appellant. The Commissioner also found that invoices did not suggest that the price contracted was ex-works price. Thus, according to the Commissioner, the title of the goods were transferred to the buyer only when the buyer received the goods and the ownership of the goods was with the appellant till they reached the destination. In arriving at such a conclusion, the Commissioner (Appeals) placed reliance upon the decision of the Supreme Court in Roofit Industries Ltd. 13. The place of removal has been defined in section 4(3) of the Excise Act as follows: "4(3)(c) "place of removal" means- (i) a factory or any other place of premises of production or manufacturing of the excisable goods; (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty; (iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be ....
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....mises of the customer was actually the place of removal and not the factory gate of the Industry. The Tribunal, however, by decision dated July 24, 2006, reversed the order of the Commissioner in view of the decision of the Supreme Court in M/s Escorts JCB Ltd. vs CCE, Delhi [2002 (146) ELT 31(SC)] and the Circular dated March 3, 2003 issued by the Board, which acknowledged that the question of ownership of goods in transit cannot be determined solely with reference to the insurance policy taken out by the manufacturer. The Supreme Court examined the provisions of section 4 of the Excise Act and observed as follows: "16. It will thus be seen that where the price at which goods are ordinarily sold by the assessee is different for different places of removal, then each such price shall be deemed to be the normal value thereof. Sub-clause (b)(iii) is very important and makes it clear that a depot, the premises of a consignment agent, or any other place or premises from where the excisable goods are to be sold after their clearance from the factory are all places of removal. What is important to note is that each of these premises is referable only to the manufacturer and not ....
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....reby indicating that it had sold the goods manufactured by it at the factory gate. Sales were made against Letters of Credit and bank discounting facilities, sometimes in advance. Invoices were prepared only at the factory directly in the name of the customer in which the name of the Insurance Company as well as the number of the transit Insurance Policy were mentioned. Above all, excise invoices were prepared at the time of the goods leaving the factory in the name and address of the customers of the respondent. When the goods were handed over to the transporter, the respondent had no right to the disposal of the goods nor did it reserve such rights inasmuch as title had already passed to its customer. On facts, therefore, it is clear that Roofit's judgment is wholly distinguishable. Similarly in Commissioner Central Excise, Mumbai-III v. M/s. Emco Ltd, this Court re-stated its decision in the Roofit Industries' case but remanded the case to the Tribunal to determine whether on facts the factory gate of the assessee was the place of removal of excisable goods. This case again is wholly distinguishable on facts on the same lines as the Roofit Industries case." 19. The Commission....