Custom, Excise & Service Tax Tribunal
M/S. Tractors & Farm Equipment Limited vs The Commissioner Of Central Excise ... on 4 January, 2011
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH AT BANGALORE Appeal No: E/116/2005 & E/935/2005 (Arising out of Order-in-Appeal No.277/2003-CE dated 25.9.2003 & Order-in-Appeal No: 300/2003-CE dated 22.10.2003 both passed by the Commissioner of Central Excise (Appeals), Bangalore-I) For approval and signature: Shri Justice R.M.S. Khandeparkar, Honble President Shri Rakesh Kumar, Honble Member (Technical) 1. Whether Press Reporters may be allowed to see 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 Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? M/s. Tractors & Farm Equipment Limited Appellant Vs. The Commissioner of Central Excise (Appeals), Bangalore I. Respondent
Appearance S/Shri Rajesh Chander Kumar, Ajayan.T.V., Advocates for the appellants.
Ms. Indira Sisupal, JDR for the revenue.
CORAM SHRI JUSTICE R.M.S. KHANDEPARKAR, HONBLE PRESIDENT SHRI RAKESH KUMAR, HONBLE MEMBER (TECHNICAL) Date of Hearing: 04.01.2011 Date of decision: 04.01.2011 FINAL ORDER No._______________________2011 Per Shri Justice R.M.S. Khandeparkar Since common question of law and facts arise in both these appeals, they were heard together and are being disposed of by this common order. While in Appeal No.E/116/2005, the impugned order is dated 25.9.2003 whereby the Commissioner (A) has upheld the decision of the Adjudicating Authority subject to re-determination of the quantification of the value relating to after sales service, whereas in Appeal No.E/935/2005, the Commissioner (Appeals) by order dated 22.10.2003 has merely upheld the decision of the Adjudicating Authority without deciding the grievance of the appellant in relation to the quantification of the value of the after sales services.
2. The appeal No.E/116/2005 relates to the period July 2000 to April 2002 whereas the appeal No.E/935/2005 relates to the period May 2002 to October 2002.
3. The Adjudicating Authority by orders dated 27.2.2003 and 16.4.2003 has held that value of after sales service i.e., in relation to the free services rendered after the sales of tractors is includable in the transaction value of the tractors and the same having not being included for the relevant period, the appellants are liable to pay the differential duty to the tune of Rs.5,29,784.96 Ps. besides Cess of Rs.4801.18 Ps. for the period from July 2000 to September 2000 and sum of Rs.37,89,451/- besides Cess of Rs.32,543/- for the period from October 2000 to April 2002, whereas sum of Rs.8,35,036/- and Cess of Rs.7,568/- being due and payable for the period from May 2002 to October 2002.
4. The learned advocate for the appellant, while disputing the liability of the appellants to include the value of after sales in the transaction value and drawing our attention to the order dated 30.1.2008 passed in Appeal No.1086/2006 by the Tribunal in the appellants own case dismissing the appeal filed by the department relying upon the decision of the Tribunal in Maruti Udyog Ltd. Vs. CCE, Delhi-III reported in 2004 (170) ELT 245 (Tri.-Del.) has contended that the department having not challenged the said decision, the lower authority erred in denying similar benefit to the appellants in relation to the relevant period. However, the learned advocate has also fairly submitted that the similar issue had arisen before the Larger Bench in Maruti Suzuki India Ltd. Vs. CCE, Delhi-III reported in 2010 (257) ELT 226 (Tri.-LB) and the Larger Bench having decided the issue against the contention of the assessee herein, submitted that the Commissioner (Appeals) should have atleast directed quantification of the value of such services afresh for the entire period and not restricted to the period from July 2000 to April 2002.
5. Indeed in view of the decision of the Larger Bench on the point whether the charges towards pre-delivery inspection and after sales service by the dealers from the buyers of the cars are to be included in the assessable value of the cars in light of the definition of transaction value under Section 4 (3) (d) of Central Excise Act, 1944, in favour of the department and against the assessee, the said issue stands concluded. On merits, therefore, no fault can be found with the impugned orders.
6. However, the appellants are justified in contending that in the absence of proper analysis of the materials on record regarding the valuation of said services, the matters need to be remanded to the Adjudicating Authority for that purpose in relation to the entire period.
7. The contention of the learned advocate for the appellant that the appellants case should be considered differently from the one decided in terms of Maruti Suzuki India Ltd. case (supra) merely on the basis of failure on the part of the department to challenge the order dated 30.1.2008, however, is devoid of substance. Once the law has been settled by the decision of the Larger Bench of the Tribunal, it is binding upon all the authorities. Failure on the part of the department to challenge an order in relation to a particular period cannot endevaour to the benefit of the appellant for the remaining period as it will amount to deciding the matter contrary to the law laid down by the Larger Bench of the Tribunal.
8. In the result, therefore, the appeal No.E/935/2005 partly succeeds, as far as, need for the Adjudicating Authority to re-determine the value of after sales service, for the entire period. Accordingly, the same is allowed to that extent only and the Adjudicating Authority is directed to re-determine the value of after sales service along with the similar issue in relation to the period July 2000 to April 2002. The Appeal No.E/116/2005 is dismissed. The Appeals accordingly stands disposed of on above terms.
(Pronounced and dictated in open Court) (Justice R.M.S. Khandeparkar) President (Rakesh Kumar) Member (T) //rv// 2