Customs, Excise and Gold Tribunal - Mumbai
Aglowmed Pvt. Ltd. vs Commissioner Of Central Excise on 10 April, 2000
Equivalent citations: 2000(120)ELT749(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. The representative of the appellant stated that of the four expenses includibility in the assessable value of which is to be considered, he was not pressing the cost of the duty paid sales depots since the judgment of the Supreme Court in Government of India v. Madras Rubber Factory Ltd. 1995 (77) E.L.T. 433 is against him. Having heard his arguments and the departmental representative on the other issues, we decide them as follows.
Forwarding charges
2. It was contended on behalf of the appellant that these charges are those incurred on account of loading and unloading of the goods on to the trucks or from the docks to the depot and that they are therefore part of the cost of transport, which has been allowed to be permissible deduction in the cost and they are depot sales, as the appellant does, in paragraphs 24 and 27 of the judgment of the Supreme Court in Government of India v. Madras Rubber Factory Ltd. The departmental representative contends, that it is only those charges which are directly attributable for transportation which could be deducted and charges such as preparing invoices etc. which may have an indirect link to transportation. We agree that the cost incurred for loading and unloading of goods for the purpose of transportation of the goods from the factory to the point of delivery would be part of transport charges and hence would be covered by the judgment. We are however not able to agree that the charges which may indirectly connected with such transportation such as preparing documents etc could not be excludible. It will be necessary for the Assistant Commissioner on the basis of evidence produced by the appellant to determine those costs which are directly related to transport and to exclude them.
Special secondary packing
3. After hearing the representative of the appellant at length, it emerged that the goods when it left the factory at Ankleshwar for central depot at Mumbai, from which it further transported to branch depots and thereafter to buyers are invariably packed in corrugated cartons which is described as special secondary packing. In this background it is not possible for us to accept the contention on behalf of the appellant that such packing is not necessary for the goods usually sold in the whole market are placed. This would mean that the applicant, somewhere between the factory and the customer's premises remove the special packing of corrugated carton. The representative was not able to explain to us why the appellant should go to the extent of undertaking such expenses. In any event, he agrees in reply to our question, that majority of the goods leave the wholesale market in the corrugated packing. In that situation, these goods are usually sold in this packing and cost of such packing is therefore includible in the assessable value.
Interest on receivables
4. The representative of the appellant admitted that there was a contradiction in the stand taken by the appellant as to the actual nature of this expense. While officially it was stated that (they represent the interest due from its customers on account of delayed payment, it was later on stated that this represented the interest paid by the appellant to the banks towards the advances taken on the stocks lying unsold. If these charges represent the former it is entitled to deduction in terms of paragraph 66 of the decision of the Supreme Court in Government of India v. Madras Rubber Factory Ltd. If they are the latter, they are not in terms of paragraph 65 of the judgment. We therefore consider that this aspect also requires re-examination in the hands of the Assistant Commissioner.
5. The appeal is therefore partly allowed. The representative of the appellant undertakes to produce before the Assistant Commissioner within two months from the date of receipt of this order, evidence with regard to two elements which consider requires re-examination. The Assistant Commissioner shall, after considering such evidence, pass orders in accordance with law.