2006 (3) TMI 453 - AT - Central Excise

Summary

Issues: Revenue appeal against demands raised for enhancing the assessable value of Polyester Sewing Thread sold to a related person without declaration during a specific period.

Analysis:

1. Assessable Value Dispute: The main issue in this case revolved around the assessable value of goods sold to a related person, with the Revenue contending that the price sold to the related person could not be adopted. The Commissioner (Appeals) accepted the assessee's contention that the goods were sold at the same price to both related and independent buyers. The Tribunal cited precedent (Hingorami Air Products v. Collector) to establish that if goods are sold at the same price to independent buyers, the assessable value for all goods, including those sold to related persons, should be based on the price available to independent buyers. The Tribunal upheld the Commissioner's decision, emphasizing that the assessable value for goods sold to the related person should be the same as that for goods sold to independent buyers.

2. Evidence Examination: The Revenue argued that the Commissioner did not examine evidence showing clandestine transactions and suppressed profits shared between the parties. However, the Tribunal found no merit in this argument, stating that there was no charge of receiving extra consideration, and the Commissioner's findings were legal and proper. The Tribunal highlighted a similar case involving M/s. Excel Thread Industries, where the Revenue's appeal was dismissed by the Circuit Bench at Cochin. The Tribunal reiterated that as long as goods were sold at the same price to independent buyers, the assessable value should remain consistent, as seen in the case of M/s. Golden Threads.

3. Precedent and Dismissal: The Tribunal referenced the dismissal of the Revenue's appeal in a similar case involving M/s. Excel Thread Industries by the Circuit Bench at Cochin. The Tribunal emphasized that as long as goods were sold to independent buyers at the same price, the assessable value should not be altered based on sales to related persons. The Tribunal concluded that there was no merit in the current appeal and rejected it, following the precedent set in previous cases.

In conclusion, the Tribunal upheld the Commissioner (Appeals)' decision regarding the assessable value of goods sold to a related person, emphasizing the importance of consistent pricing for goods sold to both related and independent buyers. The Tribunal dismissed the Revenue's appeal, citing relevant precedents and highlighting the lack of merit in challenging the Commissioner's findings.