2003 (7) TMI 378 - AT - Central Excise

Summary

Issues: Eligibility for discount from the assessable value of paints and varnishes.

In this judgment delivered by the Appellate Tribunal CESTAT, Mumbai, the primary issue at hand was the eligibility of a company to claim a discount from the assessable value of paints and varnishes it manufactured. The tribunal considered two types of discounts - bonus scheme and other dealer discount schemes. The appellant conceded that they did not have any claim for core commission and special deals, leaving only these two discounts for consideration.

The bonus scheme, as explained by the appellant's representative, was decided by branch managers and applicable to dealers within their jurisdiction. However, crucial details such as the parameters for qualifying for the bonus were not provided, and no written material outlining these parameters was produced. The tribunal found it impossible to conclude that such a discount qualified for deduction due to the lack of uniformity and transparency in the scheme.

Similarly, the other dealer discount scheme was also scrutinized. While a circular was presented to regulate this discount, it lacked specific parameters and only mentioned that schemes were usual for a period of one month. The tribunal emphasized the importance of having detailed schemes announced in advance to qualify for deduction, which was not the case here. The absence of supporting evidence led the tribunal to dismiss the claim for this discount as well.

The appellant relied on a judgment of the Bombay High Court, citing bonus discount and additional product rebate. However, without the necessary details of the scheme in question, the tribunal found it impossible to apply the High Court's conclusion to the discounts under consideration. Ultimately, the appeals were dismissed, highlighting the importance of providing clear and documented evidence to support claims for discounts in such cases.