TaxTMI 
TaxTMI 
2025 (3) TMI 959
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....ment has raised a demand of Excise Duty on the product subsidy amount and freight subsidy amount during the period March, 2011 to June, 2013. The Adjudicating Authority has confirmed the demand raised in terms of SCN dt.29.10.2013. 2. The issue, in brief, is that the appellants were receiving certain fertiliser subsidy from the Ministry of Chemicals and Fertilisers, Government of India. It was noticed by the department that they were not discharging Central Excise Duty on the said amount of subsidy received from the Government. The department relied on Rule 6 of Central Excise (Determination of Price of Excisable Goods) Rules, 2000, as also on Rule 11 of the Valuation Rules to come to the conclusion that the price includes in addition to....
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.... a) CCE, Bangalore Vs Mazagon Dock Ltd [2005 (187) ELT 3 (SC)] b) Ranar Agrochem Ltd Vs CCT, Visakhapatnam-GST [2024 (3) TMI 1279 - CESTAT Hyderabad] c) Coramandel International Ltd Vs CCE, C & ST, Visakhapatnam-I [2015 (319) ELT 526 (Tri-Bang)] 5. He further argues that the Circular No. 983/7/2014-CX dt.10.07.2014 makes abundantly clear that subsidy received from the Government by the fertiliser company cannot be subjected to Excise Duty and cannot be loaded to transaction value as additional consideration. He further submits that they are receiving subsidy both on account of product as well as for the freight. However, the sale is only as per the administered price/regulated price fixed by the Government from tim....
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....aid amount of subsidy received from the Government. We find that the issue regarding leviability of Central Excise Duty on subsidy amount given by the Government to the fertiliser company is clearly explained by the Board vide Circular No.983/7/2014-CX, wherein, inter alia, it was clarified that in respect of fertiliser for which subsidy is provided by the Government, Excise Duty will be chargeable on the MRP and not on the subsidy component provided by the Government. We also note that this clarification was issued in view of department issuing SCNs relying on the judgment of Hon'ble Supreme Court in the case of CCE, Mumbai Vs Fiat India Pvt Ltd (supra). We also note that in the SCN, the Adjudicating Authority also relied on the same judgm....
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....upra), the issue was whether the amount received by the assessee from the Oil Marketing Company (OMC) can be subjected to Central Excise Duty or otherwise, even though the oil marketing company was paying certain extra amount in addition to the regulated price being charged by the ONGC and this extra amount was coming from the oil pool account regulated by the oil coordination committee. Therefore, the facts are quite different and the amount received by ONGC was not in the nature of subsidy as in the case of present appeal where it is direct subsidy from the Ministry of Chemicals and Fertilisers, Government of India. Even a plain reading of the statutory provisions of section 4 would indicate that when price is not the sole consideration, ....