Custom, Excise & Service Tax Tribunal
M/S. Lifelong India Pvt. Ltd vs Cce, Delhi-Iii on 16 February, 2012
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
DIVISION BENCH
Court No.III
Appeal No.E/2069/11
Date of Hearing/Decision: 16.02.2012
M/s. Lifelong India Pvt. Ltd. Appellants
Vs
CCE, Delhi-III Respondent
Present for the Appellant: Shri B.L.Narsimhan, Advocate
Present for the Respondent: Shri S.K.Panda, JCDR
Coram: Honble Mrs.Archana Wadhwa, Member (Judicial)
Honble Mr.Rakesh Kumar, Member (Technical)
ORDER NO._______________
PER: MATHEW JOHN
The demand of duty of Rs.4,06,412/- stands confirmed against the applicant/appellant along with imposition of penalty of identical amount by including the quantum of sales tax collected by them from their customers but not paid to sales tax department.
2. After hearing both sides, we find that the sales tax was being collected by the appellant from their buyers of the goods. The invoiced issued by them indicated the entire amount of sales tax. However, as consequence of benefit conferred under Haryana General Sales Tax Act, 1973, the appellants were not required to deposit 50% of the amount of sales tax so collected. The Revenue entertained the view that such 50% of the sales tax retained by the appellant, is required to be added in the assessable value of the goods. Accordingly proceedings were initiated which culminated into impugned order passed by the lower authorities.
3. After hearing both sides, we find that the issue is fully covered by the Tribunals decision in the case of Maruti Udyog Ltd. vs. CCE, Delhi-III-2004 (166) ELT 360 (Tri.-Del.). By considering the provisions of Haryana General Sales Tax Act, 1973, the Tribunal has observed that 50% of Sales Tax amount retained by way of adjustment between the assessee and the State Government towards release of capital subsidy by State Government and this adjustment does not change the nature of the amount as Sales Tax payable. We find that the said decision of the Tribunal fully covers the issue involved in the present case.
4. Learned AR appearing for Revenue has drawn our attention to the fact that an appeal filed by the Revenue against the decision in the case of Maruti Udyog (Supra) has been admitted by the Hon Supreme Court as reported at 2004 (172) E.L.T. A137 (S.C.).
5. The Ld AR points out another decision of the Tribunal in the case of Andhra Oxygen Pvt. Ltd. vs. CCE, Visakhapatnam-2003 (156) ELT 283 (Tri.-Kolkata) where in it was held that the sales tax collected from the buyers but not paid to the sales tax department is liable to be included in the assessable value. We find that the facts in the said decision are different. There was total exemption from payment of sales tax in terms of Andhra Pradesh General Sales Tax Act, 1957. In the circumstances, the Tribunal observed that the sales tax collected which was otherwise exempted, is liable to excise duty. However, in the present matter, we find that the scheme operates differently. The Sales Tax is deemed to be paid to the Sales Tax authority but adjusted against subsidy to be paid by the State to the appellant. So the sales tax collected is to be considered as sales tax payable within the meaning of transaction value as defined in section 4 of Central Excise Act. This issue is already decided by the Tribunal and we do not see any reason to take a view different from the earlier decision.
6. This we find that the issue is covered by the decision in Maruti Udyog Ltd. vs. CCE, Delhi-III-2004 (166) ELT 360 (Tri.-Del.). We accordingly allow he appeal.
(Pronounced on the open court on ______________) (ARCHANA WADHWA) MEMBER (JUDICIAL) (MATHEW JOHN) MEMBER (TECHNICAL) 3