TaxTMI 
TaxTMI 
2004 (11) TMI 208
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....ceived back in their factory. 2. Shri A.R. Madhav Rao, learned Advocate, mentioned that the Appellants manufacture Filter Elements, Inserts and Cartridges and components thereof; that the excisable goods manufactured by them are either sold from their two factories to various vehicle manufacturers or stock transferred to depot where from the goods are stock transferred to various C & F Agents; that the Commissioner under the impugned Order has confirmed demand of duty and imposed penalty, by invoking extended period of limitation holding that the deduction on account of volume discount, cash discount and sales tax from the value is not admissible and that they had removed fresh excisable goods without payment of duty in place of defectiv....
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....sales tax deduction and volume deduction claimed in price declaration vis-a-vis actually passed on. The learned Advocate contended that the Department is not disputing actual Volume Discount passed on or Sales Tax which was indicated in letter date 9-7-2001; that respective clearances effected from the factory and actual amount claimed as deduction should be taken into account and then, it should be compared with the amount indicated in Annexure to letter dated 9-7-2001. He also mentioned that stock transferred value was considered as net of volume discount, cash discount and sales tax; that consequently the percentage of deduction claimed by them indicated in show cause notice is very high; that this percentage is being applied to ascertai....
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.... Khandra unit in which Gulati has been working and not for Mehrauli Road Unit; that duty demand pertaining to Khandra unit is Rs. 5,29,837/- and for Mehrauli Unit Rs. 8,13,209/-. Finally he mentioned that duty demand has been confirmed on entire quantity of material received back from the customers and as such the duty has also been in respect of goods which have been received back by them but not cleared subsequently to the customers; that the duty in respect of such goods works out to be Rs. 2,50,454/- which is unsustainable. 6. Countering the arguments, Shri S.C. Pushkarna, learned D.R., reiterated the finding as contained in the impugned Order and emphasised that Shri R.K. Gulati has never retracted his statement; that he is the auth....
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....ave not actually been rectified and entire new finished products have been sent to the buyer taking it as the goods rectified." This is clear admission on the part of the authorised signatory for Excise matters that new excisable goods were cleared in place of defective goods received back. This statement has not been retracted by Shri Gulati at all. The certificate given by the Chartered Engineer is dated 5-7-2002 which is much after the period involved in the present matter before us and cannot overcome the clear admission by the authorised signatory of the Appellant-company. We also do not find any force in the submission that Shri Gulati's statement can be relied upon only in respect of Khandra factory not in respect of factory at M....
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....espect of cash discount which was not actually passed on to the customers. The learned Advocate has relied upon the decision in Pace Marketing Specialities Ltd., supra, wherein it has been held by the Tribunal that cash discount is a discount allowed for prompt payment for the goods and when this discount is reduced from the invoice price, transaction value at the time of delivery of goods is obtained, otherwise, the invoice price is a future price and as the assessable value is to be determined with regard to time of removal financing and other cost cannot form part of the assessable value. With due regard, we find ourselves unable to agree with this view. The measure for valuation under New Section 4 of the Central Excise Act (with effect....
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....section (3) of Section 4 of the Act as under :- "transaction value" means the price actually paid or payable for the goods, when sold, and includes in addition to amount charged as price, any amount that the buyer is liable to pay to, or on behalf of, the assessee, by reason of, or in connection sold, and includes in addition to amount charged as price, any amount that with the sale, whether payable at the time of the sale or at any other time, including, but not limited to, any amount charged for, or to make provision for, advertising or publicity, marketing and selling organization expenses, storage, outward handling, servicing, warranty, commission or any other matter, but does not include the amount of duty of excise, sales tax....