Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of C. Ex. vs Supreme Industries Ltd. on 25 August, 2004
Equivalent citations: 2005(179)ELT555(TRI-CHENNAI)
ORDER P.G. Chacko, Member (J)
1. These appeals filed by the Department are against a common order passed by the Commissioner (Appeals) in 9 appeals of the assessee, which were directed against orders of the original authority confirming demands of duty against them by including actual cash discount in the assessable value of the goods supplied to buyers. The Commissioner (Appeals) has set aside the demands. The respondents used to allow cash discount to varying extents to their wholesale buyers, depending on promptness of payment by the latter, as below :-
(a) for payment within 7 days, 5% on basic price
(b) for payment within 15 days, 3% on basic price
(c) for payment within 30 days, 2% on basic price.
The respondents deducted the maximum discount of 5% from the assessable value of the goods cleared to all the buyers, and paid duty accordingly. This was resisted by the Department in show cause notices which were issued to the assessee holding that cash discount actually allowed to the buyers only could be deducted from the assessable value. This view taken in the show cause notices was upheld by the original authority. The Commissioner (Appeals) set aside the orders of the original authority as per the impugned order, para 11 of which reads as under :-
"I find that the issue involved in the Appellants' case is squarely covered by Hon'ble Tribunal judgment in their own case, pertaining to their Pondicherry factory only, i.e. Hon'ble CEGAT, vide its Final Orders No. 1180/2000, dated 21-8-2000 and 491/2002, dated 1-3-2002, has held that maximum cash discount is deductible from the assessable value across the board and is not restricted to the individual buyers who have availed of the discount. This view has been also supported by the decision of the Bombay High Court in the case of M/s. Goodlass Nerolac Paints Ltd., v. UOI reported in 1993 (65) E.L.T. 186 (Bom.) and also by Hon'ble Supreme Court in the case of M/s. H & R Johnson (India) Ltd. v. CCE, Bangalore reported in 2000 (119) E.L.T. A239."
2. Heard both sides. Ld. SDR reiterates the grounds of the appeals. She also points out that the Supreme Court has admitted a Civil Appeal filed by the Department against the Tribunal's decision in Addison Paints & Chemicals Ltd. v. Collector, 2002 (147) E.L.T. 1241 (Tri. - Del.) which was to the same effect as the Tribunal's decisions relied on in the impugned order. However, it is conceded, the Apex Court has declined to stay the operation of the decision of the Tribunal in Addison Paints & Chemicals (supra).
3. Ld. Counsel for the respondents has cited a plethora of decisions of this Bench, in addition to those mentioned in para 11 of the impugned order. The citations are as under :-
(1) Supreme Industries Ltd. v. Commissioner, Final Order No. 491/2002, dated 1-3-2002 in Appeal No. E/923/99.
(2) Supreme Industries Ltd. v. Commissioner, Final Order No. 1180/2000, dated 21-8-2000 in Appeal No. E/727/2000.
(3) Supreme Industries Ltd. v. Commissioner, 2003 (59) RLT 555 (CESTAT -Che.) (4) Commissioner v. H & R Johnson (India) Ltd., 1999 (112) E.L.T. 65 (T).
With reference to the Bombay High Court's decision in Goodlass Nerolac Paints vide para 11 of the impugned order, the learned Counsel submits that the said decision was affirmed by the Supreme Court vide 1994 (73) E.L.T A58. Similarly, the Tribunal's decision in the case of H & R Johnson (supra) was also affirmed by the Apex Court vide 2000 (119) E.L.T. A239.
4. We have considered the submissions and the case law cited by both sides. The impugned order is based on case law directly on the issue vide Para 11 thereof. None of the decisions relied on by the learned Commissioner (Appeals) in his order has even been attempted to be distinguished in the memoranda of appeals. Numerous decisions of this Bench cited by the learned Counsel are additions to the case law on the point. As we have already noted, the decisions of the Bombay High Court and this Tribunal in the cases of Goodlass Nerolac Paints (supra), and H & R Johnson (supra) respectively have been affirmed by the Apex Court. It is also pertinent to note that the Revenue has not succeeded in obtaining stay from the Supreme Court against the Tribunal's decision in Addison Paints & Chemicals (supra). It is, further, noted that the orders of this Tribunal on the same issue in the respondent's own earlier cases have not been challenged by the Department.
5. The issue stands settled by a line of decisions in favour of the respondents. Accordingly, the maximum cash discount is deductible from assessable value across the board, which benefit is not restricted to the buyers who obtained such discount. In the instant case, cash discount to the extent of 5% is liable to be allowed as deduction from assessable value in respect of goods supplied to all buyers. In the result, we reject the appeals of the Revenue.