Customs, Excise and Gold Tribunal - Bangalore
I.B.P. Co. Ltd. vs Cce on 18 November, 2004
Equivalent citations: 2005(118)ECR334(TRI.-BANGALORE)
ORDER S.L. Peeran, Member (J)
1. The appellant is a PSU unit. They are aggrieved with the OIA No. 187/98 dated 23.11.1998. The question before the Commissioner was as to whether: (a) the price of the petroleum products fixed by an Administrative order can be deemed to be the price fixed by another law under the provisions of Section 4(l)(a)(ii) of the Act; and (b) the so called other charges viz. State surcharge, Retail Pump Outlet Charges, RPO surcharge, Railway siding/shunting charges and Notional Railway freight charges collected by the appellants qualify for deduction from the sale price to determine the assessable value under Section 4 of the CE Act, 1944.
2. The Commissioner has noted that in terms of proviso (ii) to Section 4(1)(a) of CE Act, where such goods are sold by the assessee in the course of wholesale trade for delivery at the time and place of removal at a price fixed under any law for the time being in force or at a price, being the maximum, fixed under any law, then, notwithstanding anything contained in clause (iii) of the proviso, the price or the maximum price, as the case may be, so fixed, shall in relation to the goods so sold, be deemed to be a normal price thereof. He has noted that the appellants have failed to establish that the price fixed by the Ministry of Petroleum & Natural Gas is the normal price or the maximum price. He has noted that in the instant case, the appellants have not followed the procedure prescribed under Rule 173C of the CE Rules by claiming the so called other charges towards abatement from the wholesale price and got approved by the Department. He has noted that in the absence of any such claim any recoveries over and above the invoice value are deemed to be additional amounts recovered by the appellants behind the back of the department and, therefore, they are required to be added in the assessable value. He has noted that the sale prices is the aggregate of the declared sale price and should also include any other amount received under any other name or head. He has noted that otherwise, the argument of the appellant will legalise an artificial breakup in the price, more so when other charges received are not declared. He has noted that the appellants have admitted of having recovered 'other charges' over and above the price fixed by the Ministry of Petroleum and Natural Gas. Hence, the contention of the appellants that the price fixed can be deemed to be the price fixed under any other law for the time being in force, cannot be accepted when they have admitted recovery of 'other charges'.
3. With regard to the deduction claimed on the second issue pertaining to State Surcharge, RPO sur-charges, Railway siding/shunting Charges, he has held that the same are required to be added in the assessable value.
4. We have heard the learned Consultant Shri P.V. Namasivayam and the learned SDR Shri L. Narasimha Murthy.
5. The learned Consultant pointed out that in terms of Section 2(a) of the Essential Commodities Act, the Petroleum & Petroleum products are included as essential commodities. Section 3(2)(c) without prejudice to the generality of powers conferred by sub-section (i), an order made thereunder may provide (c) for controlling the prices at which any essential commodity may be bought and sold. It is his submission that once the Essential Commodities Act fixed the prices, and an order made under Section 3 of such act, it shall have effect notwithstanding anything inconsistent therewith any enactment other than this act or any instrument having effect by virtue of any enactment other than this act. It is his submission that the non-obstinate clause in Section 6 makes it clear that the price fixed by the Oil Coordination Committee (OCC) under the Ministry of Petroleum & Natural Gas prevails over the value under Section 4(l)(a) and comes under valuation as per Section 4(l)(a)(ii). He further relied on the judgment rendered by the Tribunal in the case of Bharat Petroleum Corpn. Ltd. v. CCB, Cochin wherein it has been held that RPO charges fixed by OCC comprising or two elements (1) average freight involved in second level wholesale sale i.e. from first stage wholesale customer's bonded installation/depot to retail outlets (petrol pumps/stations) and (2) operational and maintenance costs of petrol pumps are not includible in the assessable value under Section 4 of CE Act. It is further held that RPO surcharges are being only in the nature of quantity-cum-cash discount, their rate being known to petrol pump dealers in advance and such dealers being buyers of goods against payment and not being selling agents of BPCL, are deductible to arrive at the assessable value. Likewise, State surcharges relating to sales tax and turnover tax actually paid to the State Government has been held to be deductible under Section 4(4)(d)(ii). He submits that the railway siding/shunting charges are also required to be given deduction as the same were incurred outside the factory and in this regard, relied on the judgment of the Gauhati High Court rendered in the case of Bongaigaon Refinery & Petrochemicals Limited v. Commissioner of Taxes, Assam and Ors. 103 STC 133 (Gauhati HC), SAIL v. CCE, Jamshedpur ; Hindustan Petroleum Corporation Ltd. v. CCE, Bombay-1 .
6. The learned SDR fairly conceded the position in so far as the RPO charges, RPO surcharge and State surcharge are concerned, but he submitted that in so far as the Railway shunting/sliding charges are concerned, the same is required to be included as held by the Tribunal in the case of Hyderabad Industries Ltd. v. CCE, New Delhi which has been followed in the case of BPCL v. CCE, Cochin .
7. On a careful consideration, we notice that the argument of the learned Consultant that the assessments have to be done in terms of Section 4(l)(a)(ii) has already been rejected by the Commissioner. We find that the matter has already been examined by the Tribunal in the case of BPCL v.CCE (cited ) and the prayer for fixation of the price in terms of Section 4(l)(a)(ii) has been rejected. Therefore, there is no question of giving another finding on this issue to negative the Commissioner (Appeals)'s order on this point. Insofar as the plea for deduction of RPO charges, RPO sur-charge, Retail Pump outlet Charges and State Surcharges are concerned, the matter is covered in favour of the appellant in terms of the judgment rendered in the case of BPCL {supra). Therefore, the impugned order on this point is required to be set aside by following the ratio of the cited judgments. Insofar as the prayer of the appellant to seek deduction on this Railway siding/shunting charges are concerned, we find that the issue is already covered against the appellants in terms of the judgment rendered in the case of Hyderabad Industries Ltd. v. CCE which has been followed in the case of BPCL v. CCE . The assessee is, therefore, not entitled to seek deduction on Railway siding/shunting charges and their claim on this aspect is rejected. The argument raised by the learned Counsel on this point cannot be listed in view of the judgments already rendered by the Tribunal in the cases cited above. The appeal is partly allowed in terms of the findings recorded supra.
(Pronounced in open Court on 18.11.2004).