Customs, Excise and Gold Tribunal - Delhi
C.C.E. vs Narne Tulaman Manufacturers Pvt. Ltd. on 27 November, 1997
Equivalent citations: 1998(102)ELT49(TRI-DEL)
ORDER
U.L. Bhat, J. (President)
1. The common respondent in these appeals, engaged in the manufacture of Weighbridges, filed price lists Nos. 352 to 355 and 357 in 1989-90 in Part II claiming deduction of charges for installation and commissioning at the customer's premises. The Asstt. Collector granted approval but rejected the claim for deduction. The Collector (Appeals) set aside the order. The Department, being aggrieved, has filed the present appeal.
2. The Assistant Collector relied on the respondent's own case reported in 1988 (38) E.L.T. 566. In that case the present respondent manufactured one of the three components of Weighbridge, namely, indicating system and procured two other ingredients, namely, platform and load cell from other sources and assembled the Weighbridge at the premises of the customer. It was held that Weighbridge as such came into existence only at the premises of the customer and that at that stage new excisable product came into existence and was dutiable as such.
3. Shri M. Ali, JDR also placed reliance on this decision. We do not think this decision has any application to the facts of the case, that is because in the present case all the parts of the Weighbridge were manufactured and the Weighbridge itself came into existence in the factory of the respondent before clearance, though for the purpose of easy transport the Weighbridge was taken in a knocked down condition and was re-erected and re-assembled at the customer's premises. If the Weighbridge had come into existence in the factory of respondent, the price declared would naturally have taken into consideration the entire cost of all the processes leading to the coming into existence of the Weighbridge in the factory. The parties evidently were aware that it would be difficult to transport the Weighbridge as such from the factory to the premises of the customer and that it has to be transported in a knocked down condition. The contracts stipulated that respondent has to attend to the erection and commissioning of the Weighbridge at the site.
4. In a case where a particular finished product comes into existence in the factory before clearance, the assessable value will naturally be based on the price which inevitably would take into consideration all the expenses in the factory. The transport of the product and the re-erection and commissioning charges which may be incurred at the premises of the customer by the customer or at the instance of the customer by the manufacturer initially have to be regarded as post manufacture and post clearance expenses which cannot be included in the assessable value. This position has been accepted by the Tribunal in the case of Braithwaite & Company Ltd. v. Collector of Central Excise, Calcutta-II, 1987 (29) E.L.T. 251 (Tribunal), of Sunray Computers Pvt. Ltd., 1988 (33) E.L.T. 787 (Tribunal) (this part of the decision was not challenged before the Supreme Court and was not set aside by the Supreme Court) and of LML Ltd., 1997 (90) E.L.T. 359 (Tribunal). The Tribunal has consistently held that in such circumstances cost of installation and commissioning at the premises of the customer cannot be part of the assessable value.
5. For the above reasons, we find no ground to interfere and accordingly dismiss the appeals.