2024 (5) TMI 1129

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....er (Appeals) by which the appeal filed by the appellant as also three other appeals has been dismissed. The appellant had filed the appeal to assail the order dated 27.03.2018 passed by the Assistant Commissioner for recovery of central excise duty under section 11A(10) read with section 11A(4) of the Central Excise Act, 1944 the Central Excise Act with interest and penalty. 2. A show cause notice dated 09.05.2017 was issued to the appellant alleging that the investment subsidy received by the appellant from the Government of Rajasthan under the Rajasthan Investment Promotion Policy, 2010 Rajasthan Investment Policy was adjusted by the appellant for payment of Value Added Tax VAT, but this amount was not included by the appellant in the ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ment of VAT. The Department has included this amount of subsidy in the transaction value for the purpose of levy of central excise duty under section 4 of the Central Excise Act, 1944. ***** 6. It transpires that after the Entitlement Certificate was issued to the appellant, the appellant filed a claim for grant of subsidy for the first quarter and it received the subsidy in the form of Sales Tax VAT 37B challan. In the subsequent quarter, this VAT 37B challan could be utilized by the appellant to cover a portion of the sales tax liability and the balance tax liability could be paid in cash by the appellant through VAT 37A challan. 7. To explain the method contemplated under the promotion policy, the following ill....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....x collected by the assessee from the customers is required to be paid. A portion is deposited through VAT 37B challan issued to the assessee by the State Government as subsidy under the promotion policy and the balance amount is deposited by the assessee in cash through VAT 37A challan. What has been retained by the appellant is basically the subsidy amount and it is not the case of the Department that subsidy amount has to be included in the transaction value. ***** 25. Merely because subsidy is computed with reference to the tax paid and is a percentage of the tax paid, will not mean that it is directly or indirectly related to the sale of goods and would be an additional consideration. The amount of subsidy to be provid....