Custom, Excise & Service Tax Tribunal
M/S. Marpol Pvt Ltd vs Commissioner Of C. Ex. Goa, Panaji on 22 December, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. E/1178/07 [Arising out of Orders-in- Appeal No. GOA/CEX/SB/41/2007 dated 12-4-2007 passed by the Commissioner(Appeals) Central Excise & Customs, Goa-Panaji ] For approval and signature: Honble Mr Ramesh Nair, Member(Judicial) Honble Mr. Raju, Member (Technical) =======================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
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M/s. Marpol Pvt Ltd
:
Appellant
VS
Commissioner of C. Ex. Goa, Panaji
:
Respondent
Appearance
Shri. S.R. Sawant, Advocate for the Appellants
Shri. V.K. Shastri, Asstt. Commissioner(A.R.) for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Honble Mr. Raju, Member (Technical)
Date of hearing: 22/12/2016
Date of decision 5/1/2017
ORDER NO.
Per : Ramesh Nair
The issue involved is that whether the excess insurance amount towards transit insurance of the excisable goods collected by the appellant from their buyer is includible in the assessable value of the final product or otherwise.
2. Shri. S.R. Sawant, Ld. Counsel for the appellant submits that firstly the amount collected is not towards sale of goods but is on account of insurance premium for transit of insurance of the goods therefore the same is not includible in the assessable value. Secondly the amount which was collected even though it is in excess the same stands adjusted in the amount of insurance premium in respect of subsequent clearances therefore appellant has not been benefited with excess amount collected as insurance amount from their customers. He submits that insurance per se is not includible in the assessable value. In support of his submission, he placed reliance on the following judgments:
(a) Commissioner of Central Exicse, Nashik Vs. General Metallisers Ltd[2014(300) ELT 534(Tri. Mum)]
(b) Commissioner of C. Ex. Mumbai Vs. Kaycee Industries Ltd [2012(278) ELT 244(Tri. Mumbai)]
(c) Commissioner of C. Ex. Mumbai Vs. Larsen & Toubro Ltd[2009(244) ELT 306(Tri. Mumbai)]
(d) Yamuna Motors India Pvt Ltd Vs. Commissioner of C. Ex. Noida[2014(301) ELT 524(Tri. Del)]
(e) Andhra Sugars Limited Vs. Commissioner of C. Ex. Guntur[2007(212) ELT 48(Tri. Bang)]
(f) Commissioner of Central Excise, Pondey Vs. Wipra Acer Ltd[2015(323) ELT 158(Tri. Chennai)]
3. Shri. V.K. Shastri, Ld. Asstt. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order.
4. We have carefully considered the submissions made by both sides.
5. We find that the excess amount collected by the appellant is towards insurance premium. However in certain cases they have collected excess amount as compared to the actual insurance premium from their customer. Since the amount collected irrespective any excess amount is on account of insurance amount, the same is not part and parcel of the sale of the goods. The Honble Apex Court in case of Baroda Electric Meters Ltd. Versus Collector of Central Excise [1997 (94) E.L.T. 13 (S.C.)] held that even if amount on account of freight collected over and above the actual freight that amount is on account of freight only and therefore the same is not includible in the assessable value. Following the said Honble Apex Court judgments this Tribunal in case of U. P. Twiga Fiberglass Ltd. Versus Commissioner of C. Ex. & S. T., Noida[2015 (316) E.L.T. 304 (Tri. - Del.)] held that amount collected over and above as insurance premium paid to the insurance company the excess amount not includible in the assessable value under Section 4 of Central Excise Act, 1944. Following the aforesaid decisions, we are of the view that excess amount collected by the appellant on account of insurance premium is not includible in the assessable value, accordingly, the impugned order is set aside and appeal is allowed.
(Order pronounced in court on________________ ) Raju Member (Technical) Ramesh Nair Member (Judicial) sk 2 E/1178/07