TaxTMI 
TaxTMI 
2024 (9) TMI 1168
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....ious judgments the freight shown separately in the invoice is not includible in the assessable value. He placed reliance on the following judgments:- * CCE V/s Ispat Industries Ltd. - 2015 (324) E.L.Τ. 670 (S.C.) * Jindal Tubular (India) Ltd. V/s CCE-(2023) 4 Centax 3 (Tri-Del) * Eimco Elecon India Ltd. V/s CCE-2024 (4) TMI 62 CESTAT Ahmedabad * Mira Industries V/s CCE-2023 (4) TMI 655 CESTAT Ahmedabad * Panama Petrochem Ltd. V/s CCE-2024 (4) TMI 325- CESTAT Ahmedabad * Gujarat Fluorochemicals Limited V/s CCE-2024 (1) TMI 883 - CESTAT Ahmedabad * Sayaji Senthness Ltd. V/s CCE- 2024 (5) TMI 194 CESTAT Ahmedabad * Graphite India Ltd V/s CCE-2017 (358) E.L.T. 263 (Tri - Mumbai) * Jost's Engineering Co. Ltd. V/s CCE-2017 (7) G.ST.L. 344 (Tri. - Mumbai) * Emerson Network Power (I) Pvt. Ltd. V/s CCE-2017 (6) G.S.T.L. 321 (Tri. Mumbai) * Sanjivani Ssk Ltd. V/s CCE-2016 (333) E.L.T. 363 (Tri. - Mumbai) * CCE V/s Accurate Meters Ltd.-2009 (3) TMI 1-Supreme Court * Escorts JCB Ltd. V/s CCE-2002 (10) TMI 96-Supreme Court 3. Shri Ajay Kumar Samota, Learned Superintendent (AR) appearing on behalf of the Revenue, reiterates the findings in the impugned order. ....
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....of the Act except the circumstances in which the excisable goods are sold for delivery at a place other than the place of removal, then the value of such excisable goods shall be deemed to be the transaction value, excluding the cost of transportation from the place of removal upto the place of delivery of such excisable goods. Explanation 1 - "Cost of transportation" includes - (i) the actual cost of transportation; and (ii) in case where freight is averaged, the cost of transportation calculated in accordance with generally accepted principles of costing. Explanation 2 - For removal of doubts, it is clarified that the cost of transportation from the factory to the place of removal, where the factory is not the place of removal, shall not be excluded for the purposes of determining the value of the excisable goods." 23. It is clear, therefore, that on and after 14.5.2003, the position as it obtained from 28.9.1996 to 1.7.2000 has now been reinstated. Rule 5 as substituted in 2003 also confirms the position that the cost of transportation from the place of removal to the place of delivery is to be excluded, save and except in a case where the factory is not the place of r....
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....] "From the above passage it is clear that ownership in the property may not have any relevance insofar as insurance of goods sold during transit is concerned. It would therefore not be lawful to draw an inference of retention of ownership in the property sold by the seller merely by reason of the fact that the seller had insured such goods during transit to the buyer. It is not necessary that insurance of the goods and the ownership of the property insured must always go together. It may be depending upon various facts and circumstances of a particular transaction and terms and conditions of sale. A reference has also been made to Colinvauz's Law of Insurance, 6th Edn. by Robert Merkin to indicate that there may be insurance to cover the interest of others, that is to say, not necessarily the person insuring the interest must be the owner of the property." [at para 10] 26. This Court then went on to follow Bombay Tyre International's case and ultimately held:- "In view of the discussion held above, in our view the Commissioner of Central Excise and CEGAT erred in drawing an inference that the ownership in the property continued to be retained by the assessee till it ....
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....)(a), the normal price is the price at which goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and price is the sole consideration for sale. Therefore, the normal price is the price at the "time of delivery" and "at the place of removal". Before the amendment, the place of removal was only the factory or any other place or premises where the excisable goods were produced or manufactured or a warehouse or any other place or premises where any excisable goods have been permitted to be deposited without payment of duty. Thus, the price would be the price at that place. By the amendment proviso (i-a) to Section 4(1)(a) has been added. Under Section 4(1)(a)(i-a) where the price of the goods is different for different places of removal, each such price was deemed to be the normal price of such goods in relation to "such place of removal". Thus, if the place of removal was the factory, then the price would be the normal price at the factory. If the place of removal was some other place like a depot or the premises of a consignment agent and the price was different the....
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....f this Court. In CCE & Customs v. Roofit Industries Ltd., (2015) 319 E.L.T. 221 (S.C.), this Court, after distinguishing the Escorts JCB's case, stated:- "The principle of law, thus, is crystal clear. It is to be seen as to whether as to at what point of time sale is effected, namely, whether it is on factory gate or at a later point of time i.e. when the delivery of the goods is effected to the buyer at his premises. This aspect is to be seen in the light of the provisions of the Sale of Goods Act by applying the same to the facts of each case to determine as to when the ownership in the goods is transferred from the seller to the buyer. The charges which are to be added have put up to the stage of the transfer of that ownership inasmuch as once the ownership in goods stands transferred to the buyer, any expenditure incurred thereafter has to be on buyer's account and cannot be a component which would be included while ascertaining the valuation of the goods manufactured by the buyer. That is the plain meaning which has to be assigned to Section 4 read with the Valuation Rules. In the present case, we find that most of the orders placed with the respondent assessee wer....
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....ng to the judgment in Escorts JCB Ltd. [(2003) 1 SCC 281 : (2002) 146 ELT 31] Obviously the exact principle laid down in the judgment has not been appreciated by CESTAT." [at paras 12 - 15] 32. It will be seen that this is a decision distinguishing the Escorts JCB's case on facts. It was found that goods were to be delivered only at the place of the buyer and the price of the goods was inclusive of transportation charges. As transit damage on the assessee's account would imply that till the goods reached their destination, ownership in the goods remained with the supplier, namely, the assessee, freight charges would have to be added as a component of excise duty. Further, as per the terms of the payment clause contained in the procurement order, payment was only to be made after receipt of goods at the premises of the buyer. On facts, therefore, it was held that the sale of goods did not take place at the factory gate of the assessee. Also, this Court's attention was not drawn to Section 4 as originally enacted and as amended to demonstrate that the buyer's premises cannot, in law, be "a place of removal" under the said Section. 33. As has been seen in the prese....
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....ying the transportation cost for the supply of goods. Accordingly, appellant have supplied the goods and raised invoices for the price of goods and the transportation. Thus, it amounts to showing the cost of transport separately in the invoices. 4.2 The relevant Rule 5 of the Valuation Rules is reproduced below:- "Rule 5. Where any excisable goods are sold in the circumstances specified in clause (a) of sub-section (1) of section 4 of the Act except the circumstances in which the excisable goods are sold for delivery at a place other than the place of removal, then the value of such excisable goods shall be deemed to be the transaction value, excluding the cost of transportation from the place of removal upto the place of delivery of such excisable goods. Explanation 1. - "Cost of transportation" includes - (i) the actual cost of transportation; and (ii) in case where freight is averaged, the cost of transportation calculated in accordance with generally accepted principles of costing. Explanation 2. - For removal of doubts, it is clarified that the cost of transportation from the factory to the place of removal, where the factory is not the place of removal, shall not ....
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....t includable in the assessable value of the goods for charging excise duty. Since we have decided the matter on merits of the case, we are not going to the issue of limitation raised by Ld. Advocate. 5. Accordingly, the impugned order is set aside and the appeal is allowed with consequential relief, if any, as per law." In another case of Mira industries (supra) this Tribunal passed the following order:- "04. We have carefully considered the submission made by both sides and perused the records. The issue required to be decided in this matter is that whether the amount shown separately as freight and handling charges in the invoices can be included in the assessable value u/s 4 of the Central Excise Act, 1944 or not. We find that Revenue's case has no merits as during the disputed period duty liability has been discharged by the appellant on the basis of transaction value. We have seen the specimen invoice copy produced by the learned Counsel and note that duty paying documents were indicating separately the value for the freight and handling charges. 4.1 It is the case of the department that price of the goods so recovered should include elements of freight and handling cha....