Custom, Excise & Service Tax Tribunal
M/S. Minilac (India) Pvt. Ltd vs Commissioner Of Central Excise on 13 January, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT No. I Appeal No. E/216/07 (Arising out of Order-in-Original No. 31/CX/2006 dated 07.12.2006 passed by Commissioner of Central Excise, Pune III) 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 : No 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?
M/s. Minilac (India) Pvt. Ltd.
Appellant Vs. Commissioner of Central Excise Pune Respondent Appearance:
Shri A.G. Kulkarni, Advocate with Shri Sagar Kulkarni, Advocate for appellant Shri N.N. Prabhu Desai, Supdt. (AR) for respondent CORAM:
Honble Mr. Ramesh Nair, Member (Judicial) Honble Mr. Raju, Member (Technical) Date of Hearing: 13.01.2016 Date of Decision: ..
ORDER NO Per: Ramesh Nair This appeal is directed against Order-in-Original No. 31/CX/2006 dated 07.12.2006 passed by the Commissioner of Central Excise, Pune III wherein he confirmed the duty demand of Rs.53,418/- under Section 11A and demanded interest under Section 11AB and also imposed penalty of equivalent amount under Section 11AC of Central Excise Act, 1944.
2. The facts of the case is that the dealer of the appellant carried out certain advertisement for the product sold by the appellant through dealer. The dealer recovered 50% of the expenses of the advertisement from the appellant for which the dealer is raising invoices/bills to the appellant. In the adjudication the demand was confirmed on the ground that the appellant raised debit accounts on the dealer and recovered the same, therefore the same is additional consideration and the same should be included in the assessment value.
3. Shri A.G. Kulkarni, learned Counsel with Shri Sagar Kulkarni, Advocate appearing on behalf of the appellant submits that the entire demand was confirmed only on the wrong factual matrix that the appellant have raised debit note and recovered the amount whereas the fact remains is that the dealer raised invoices/bills for 50% of the advertisement expenses for advertising the product of the appellant therefore there is no additional consideration flowing to the appellant from the dealer. Consequently, the same cannot be included in the assessable value. He placed reliance on the judgement of the Honble Supreme Court in the case of Philips India Ltd. vs. Collector of Central Excise, Pune 1997 (91) ELT 540 (S.C.).
3. On the other hand, Shri N.M. Prabhu Desai, learned Superintendent appearing on behalf of the Revenue reiterates the findings of the impugned order. He further submits that since the advertisement was carried out by the dealer on behalf of the appellant therefore advertisement expenses must be added in the value for the purpose of discharging of excise duty.
4. We have carefully considered the submissions made by both sides.
5. We find that the advertisement expenses were incurred by the dealer and 50% of the same appears to be collected from the appellant. Therefore it is not the case that the appellant had received any amount on account of advertisement from the dealer. Therefore, prima facie there is no additional consideration flowing to the appellant from the dealer on account of advertisement. Therefore, there is no question of adding the cost of advertisement in the assessable value. Moreover we find that the whole foundation of the demand is on the incorrect factual matrix that the appellant has raised debit notes on the dealer whereas it is not coming out from the records that the appellant have raised any debit notes. On the contrary it is the dealer who raised the bills/invoices on account of 50% of the total advertisement borne by the dealer. Since the basis of the demand itself is incorrect therefore the adjudicating authority has wrongly confirmed the demand. We find that the records showing whether the debit notes were raised by the appellant or by the dealer are not available in the present appeal and also the same was not produced before the adjudicating authority, we are of the view that this is a fit case for remand the matter to reconsider all the issues on merits as well as on the facts. We, therefore, set aside the order-in-original and remit the matter to the original adjudicating authority to pass a denovo adjudication order keeping in mind our above observations. Needless to say that the appellant shall be granted sufficient opportunity to explain their case. Being very old matter the adjudicating authority is expected to dispose of the denovo adjudication preferably within a period of two months from the receipt of this order.
(Pronounced in Court on.) (Raju) Member (Technical) (Ramesh Nair) Member (Judicial) nsk ??
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1 4Appeal No. E/216/07