2006 (5) TMI 240 - AT - Central Excise

Summary

Issues:
- Common issues raised in four appeals regarding duty liability, penalty, distributor's commission, rental charges, and freight charges.

Analysis:
1. The appeals challenged the order of the Commissioner (Appeals) upholding duty liability of Rs. 11,83,295 with penalties. The duty liability included amounts for distributor's commission, duty on freight charges, and duty on rental of canisters. The appellant argued that no commission was payable to the distributor and rental charges should not be added based on previous Tribunal decisions. The department supported the impugned orders citing Board Circular and invoices as evidence.

2. The Tribunal reviewed the arguments and evidence presented. It found that the duty amount of Rs. 5,92,240 based on rental charges was not justified, aligning with the precedent set in previous cases. The transaction between the appellant and distributors was deemed to be on a principal-to-principal basis, indicating the sale occurred at the factory's gate. The affidavit of the distributor and books of accounts supported this position.

3. Regarding the distributor's commission, the Tribunal observed that the transaction value was reduced by the commission amount as shown in the invoices. The price master indicated different costs for direct local distribution and distributor, with no reduction in distributor's commission. The Tribunal concluded that the inclusion of distributor's commission in the transaction value was correct and could not disadvantage the Revenue.

4. Consequently, the Tribunal granted an interim stay on the impugned order upon the appellant depositing Rs. 4,25,728 within six weeks. Failure to comply would result in dismissal of the appeals. The remaining balance of duty and penalty would be waived upon deposit. The applications were disposed of with a compliance reporting date set for July 3, 2006. The judgment was dictated and pronounced on May 15, 2006.