TaxTMI 
TaxTMI 
2024 (9) TMI 1876
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....n in the invoice while selling the goods from the depot has to be deducted while taking the transaction value for the purpose of assessment of excise duty. Hence, the impugned order is not correct and legal. He placed reliance on the following judgments:- * Havells India Ltd. 2017 357 (ELT) 407 (Tri. - Del.) * M/s. Steel Authority Of India Limited 2024 (4) TMI 167 - Cestat Kolkata * Steel Authority Of India Ltd. 2005 (11) TMI 10 Cestat, New Delhi * Savita Oil Technologies Limited 2023 (7) TMI 1061 Cestat Ahmedabad * M/s Cipla Ltd.2016 (2) TMI 67 Cestat Mumbai * Biochem Pharmaceutical Industries 2016 337 (ELT) 276 (Tri. - Mumbai) * Hawkins Cookers Ltd. 2018 (364) E.L.T. 849 (Tri. - Chan.) * Toyota Kirloskar Auto Parts Pvt. Ltd 2012 276 (ELT) 332 (Kar.) * JK Tyres& Industries Ltd. 2023 (12) TMi 899 Cestat Bangalore 3. Shri Anoop Kumar Mudvel, Learned Superintendent (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. We have carefully considered the submissions made by both the sides and perused the records. We find that the appellant have considered the transac....
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....he transaction value is such value which is paid or payable for sale of the goods. In the present case, the value excluding the discount is the value which is paid or payable at the time of sale of the goods. There is no dispute that the discount was passed on at the time of sale itself in the sale invoice. Therefore, the discount which is neither paid nor payable against the sale of goods cannot be part and parcel of the transaction value. Therefore, the value which is charged for the sale of goods from depot of the appellant without including the discount shall be the transaction value. Therefore the appellant have correctly paid the excise duty on value minus trade discount passed on to their customer. Hence, the value was correctly determined in terms of Rule 7 of Central Excise Valuation Rules, 2000. This issue has been considered in many judgments some of the judgments are reproduced below:- * In the case of Havells India Ltd. (supra) considering the identical issue this Tribunal has passed the following judgment:- "6. We have heard both sides and perused the records. 7.Thecircumstances in which the goods are duty paid at the factory gate, but stock....
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....value which was the agreed contractual price. Any discounts which are part of the agreement of sale will need to be granted even if such discounts are not passed on. The various other decisions cited by the appellant in their favour have clearly held that the discounts are allowable on the normal transaction value from the place of removal. In the present case the place of removal is not the factory gate but the depot of the appellant. Under such circumstances the discounts allowed in the price contracted for sale from the depot would be allowable as a deduction from such price. 9.In line with the above discussions, the appeal is allowed and the impugned order is set aside with consequential relief." * Similar view was taken in the case of M/s. Steel Authority Of India Limited wherein the Kolkata Bench of the CESTAT passed the following order:- "6. We have heard the rival contentions of the two sides and perused the case records. 7. To appreciate the admissibility of discounts, it would be necessary to refer to Section 4(1) of the Act as well as Rule 7 of the Valuation Rules. The same are therefore enumerated hereunder: - ▪ Section....
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....e time of removal of goods from the factory (conveyed through the internal communications of the CMO). Such discounts are allowable as deduction from the price of the goods for the purpose of determination of duty due thereon. 8. The appellant has also submitted on record a Chartered Accountant's certificate to that effect, pointing out that the BSOs have passed on a higher MPR to the final customers as against the MPR deducted by the appellant for determining the assessable value. A copy of such a certificate issued by the Chartered Accountant is scanned and reproduced hereinbelow, confirming the said statement made : - 9. In terms of Rule 7 of the Valuation Rules, any discount given at the time of clearance of goods ought to be allowed for assessment of goods transferred to the BSO when the same is passed on to the final customers. We note that with reference to an Across the Board Rebate (equivalent to MPR), this Tribunal in the appellant's own case Steel Authority of India Ltd. v. Commr. [2006 (199) E.L.T. 112 (Tri. - Del.)] had held as under: - "8. With regard to the second ground of demand i.e. ineligibility of ABR for deduction while fixing/assessi....
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....e at which such goods are cleared from the factory." So, in the case of removal of goods from depot the time of removal should be the time at which such goods were cleared from the factory. In other words, time and place of removal provided by Section 4(1)(a), in relation to goods removed from the depot will be the factory gate and depot, respectively. Whenever goods are removed from depot, such goods are to be valued with reference to the time when it was removed from the factory." The said case was maintained by the Hon'ble Apex Court [ref. 2000 (121) E.L.T. A224 (S.C.)]. 9.2 Therefore, the rebate as was known by way of MPR and uniformly passed on would be required to be taken note of for determination of the assessable value. 9.3 We also note that there is a complete similarity in the factual matrix of the appellant's own case, with the present issue at hand inasmuch as the CMO determined the ABRs (in the present case, MPRs) and indicated the same to the plant as well as depots. The goods were sold from the depots after allowing such ABRs (in the present case, MPRs) indicated on the face of the invoice. Also, the Chartered Accountant's certifi....
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....d perused the records. We find that the appellant have made excess payment of duty on account of discount. The discount was given at the time of sale of the goods from the depot. There is no dispute about the nature and quantum of discount. The removal of goods from the factory is on presumptive value and the transaction value is finalized only at the time of sale of goods from the depot. Therefore, in our considered view the discount given by the appellant at the time of sale of goods from the depot is legal and correct and the same shall not be includible in the assessable value. Accordingly, if there is any excess payment of duty in comparison with the value at which the goods were cleared from the factory and the same goods sold from the depot, the appellant is prima-facie entitled for the refund. 4.1 As regard the reason given by both the lower authorities that the appellant have not opted for the provisional assessment, we find that firstly the same was not made charge in the show cause notice therefore the order travels beyond the scope of show cause notice which is not permissible under the law as settled in various judgments cited by the appellant. Secondly, merel....