2023 (8) TMI 1044

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....f appellant, it has been observed by the audit party that during 2014-15 to 2016-17, the appellant has recovered an amount of Rs. 7,43,61,147/- from their customers as mould charges. The appellant while manufacturing empty glass bottles and vials, as per requirement of the customers they get developed various types of moulds and the amount of development of such moulds has been collected by the appellant from their customers as mould charges. It has been the contention of the department that amount so collected by the appellant from their customers as mould charges is an additional consideration and should form part of the transaction value, as per Section 4 of Central Excise Act, 1944 for the purpose of discharging Central Excise liability....

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....mers have already been produced by the appellant before the original adjudicating authority. 3. It is further contended by the learned Chartered Accountant that since the duty of excise leviable on the additional consideration collected from their customers as mould charges has already been deposited by them and the show cause notice in this case only demanding excise duty with regard to mould charges recovered by them from their foreign customers on the quantities of the bottles exported by them. It has been the contention of the learned Chartered Accountant that since the goods have been exported by them they would have paid Central Excise duty on the same even if proportionate mould charges would have got included in the value of expo....

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.... of facts to evade payment of duty and therefore, extended period of five years is not applicable in their case. Since the goods have actually been exported, excise duty otherwise not leviable on the exported goods, the Adjudicating Authority should have dropped the show cause notice. Learned Chartered Accountant has also contended that there is no ground of levy of penalty under Section 11AC of Central Excise Act, 1944. 5. We have also heard Shri Rajesh K Agarwal, learned DR who has reiterated the findings given in the order-in-appeal as well as in order-in-original. 6. Having heard both the sides, we find that the only question which needs to be decided by us is "whether the charges of moulds separately recovered by the appellant fr....

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....y paid, shall be deemed to include the duty payable on such goods." "RULE 6. Where the excisable goods are sold in the circumstances specified in clause (a) of sub section (1) of section 4 of the Act except the circumstance where the price is not the sole consideration for sale, the value of such goods shall be deemed to be the aggregate of such transaction value and the amount of money value of any additional consideration flowing directly or indirectly from the buyer to the assessee. Provided that where price is not the sole consideration for sale of such excisable goods and they are sold by the assessee at a price less than manufacturing cost and profit, and no additional consideration is flowing directly or indirectly ....

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....s evidence to the effect that the advance received has influenced the fixation of the price of the goods by way of charging a lesser price from or by offering a special discount to the buyer who has made the advance deposit." From the above legal provision of Section 4 of Central Excise Act, 1944 read with Rule 6 of Central Excise (Determination of Price of Excisable Goods) Rules, 2000, it can be seen that the value of tools, dies, moulds, drawings etc. used in production of excisable goods need to form the part of assessable value. In this case, there is no denying the fact that appellant has been collecting mould charges from the buyers of his product and therefore we hold that the amount of mould charges collected by the appellant for....