2006 (2) TMI 527 - AT - Central Excise

Summary

Issues:
1. Inclusion of packing charges in the assessable value of soda ash.
2. Interpretation of the provisions of Section 4 of the Central Excise Act.
3. Determination of whether packing material is durable and returnable.
4. Applicability of amendments to Section 4 of the Central Excise Act.

Issue 1: Inclusion of packing charges in the assessable value of soda ash
The dispute arose when the Supdt. of Central Excise insisted that packing charges for soda ash should be included in the assessable value. The appellant challenged this, leading to SCNs being issued. The Asstt. Collector and subsequently the Hon'ble Bombay High Court set aside the orders, but the matter was remanded to the Asstt. Collector by the Hon'ble Supreme Court. The Asstt. Collector held that the cost of packing was not durable and returnable, thus includible in the assessable value. The Commissioner (Appeals) upheld this decision, leading to the present appeal.

Issue 2: Interpretation of the provisions of Section 4 of the Central Excise Act
The appellant argued that even prior to the amendment of Section 4, the cost of packing should not be included in the assessable value of goods. Citing a previous judgment, the appellant contended that the basic scheme for price determination remained consistent, and the cost of packing should not be considered.

Issue 3: Determination of whether packing material is durable and returnable
The Hon'ble Supreme Court remanded the matter to verify if there was an arrangement for the return of durable packing material. The appellant provided evidence of arrangements with customers for the return of jute bags, supported by communications. However, the lower authorities found no such arrangement, leading to a dispute.

Issue 4: Applicability of amendments to Section 4 of the Central Excise Act
The Revenue argued that the period in dispute fell before the amendment to Section 4, which explicitly excluded the cost of durable and returnable packing material from the assessable value. Referring to a previous judgment, the Revenue contended that the exception under the new scheme was not applicable to the old Section 4. Both authorities found that the packing material was not durable and returnable, justifying its inclusion in the assessable value.

In conclusion, the Tribunal dismissed the appeal, upholding the decision that the value of packing material should be included in the assessable value of soda ash, based on the evidence and findings of the lower authorities. The Tribunal's decision aligned with previous judgments on similar issues, emphasizing the importance of factual determinations and legal interpretations in such matters.