2004 (8) TMI 575 - AT - Central Excise

Summary

Issues:
- Whether the actual cash discount should be included in the assessable value of goods supplied to buyers for the purpose of calculating duty liability.

Analysis:
The Appeals filed by the Department were against a common order passed by the Commissioner (Appeals) regarding demands of duty against the assessee. The issue revolved around including the actual cash discount in the assessable value of goods supplied to buyers. The respondents used to allow varying cash discounts to wholesale buyers based on promptness of payment. The Department contended that only cash discounts actually allowed to buyers should be deducted from the assessable value, as opposed to the maximum discount of 5% across the board deducted by the respondents. The Commissioner (Appeals) set aside the demands, citing precedents and judgments supporting the deduction of maximum cash discount from the assessable value.

During the hearing, the Department reiterated its grounds for appeal, pointing out that the Supreme Court had admitted a Civil Appeal against a similar Tribunal decision. However, the Apex Court had declined to stay the operation of the Tribunal's decision. The respondents' counsel cited various decisions supporting the deduction of maximum cash discount from the assessable value, including those affirmed by the Supreme Court. The Tribunal considered the submissions and case law cited by both sides, noting that the issue was settled by a line of decisions in favor of the respondents. The Tribunal emphasized that the benefit of maximum cash discount should not be restricted to individual buyers but should be deductible across the board. Consequently, the Tribunal rejected the appeals of the Revenue, affirming the deduction of 5% cash discount from the assessable value of goods supplied to all buyers.