2002 (11) TMI 392 - AT - Central Excise

Summary

Issues:
1. Whether the appellant claimed deductions of service charges paid to indentors.
2. Whether the service charges paid can be considered as trade discount.
3. Whether the authorities correctly assessed the appellant's claim for trade discount.
4. Whether the matter requires remand for further verification.

Analysis:

1. The appellant, a manufacturer of paper and paperboards, appointed indentors for sales. The Revenue alleged that the appellant claimed deductions of service charges paid to indentors, leading to confirmed demands. However, the appellant contended they only claimed deductions for trade discounts, not service charges. The Tribunal, after verifying invoices, granted a waiver of pre-deposit, convinced of the appellant's stance.

2. The Commissioner held that service charges paid to indentors cannot be termed as trade discount, citing a previous Apex Court case. Despite the appellant's pleas and clear documentation of trade discounts in invoices, the Revenue persisted in rejecting the appellant's claims. The Tribunal found no evidence of deductions for service charges in the invoices, supporting the appellant's position.

3. The appellant's counsel demonstrated through records that only trade discounts, not commission paid to indentors, were claimed in the invoices. The Tribunal, after thorough examination, agreed with the appellant's assertion that they had not deducted commission charges from the assessable value, only trade discounts known to customers beforehand.

4. The Tribunal, satisfied with the appellant's submissions, remanded the matter to the original authority for further verification from the invoices. Emphasizing the need for expeditious resolution due to high Revenue involvement, the Tribunal set aside the impugned order for de novo consideration to ensure no duty liability exists based on the appellant's legitimate trade discount claims.