2006 (3) TMI 644 - AT - Central Excise

Summary

Issues:
Deduction of interest on receivables from the assessable value for payment of duty.

Analysis:
The appellants, engaged in manufacturing lubricating oils/preparations, deducted Rs. 1.696 per unit quantity from the sale price to determine the assessable value for duty payment, including Rs. 0.563 for "interest on receivables." The original authority disallowed this claim, directing the range officer to finalize provisional assessments and demand differential duty of Rs. 10,61,689. The first appellate authority upheld this decision, leading to the present appeal.

Represented by Shri Haren Gandhi, the appellants argued that their case aligned with previous Tribunal decisions and a Supreme Court judgment, claiming support from Gabriel India Ltd. v. Commissioner, G.T.C. Industries Ltd. v. Commissioner, and Govt. of India v. M.R.F. Ltd. The learned SDR countered, citing Hindustan Lever Ltd. v. CCE, stating that interest not charged above the price would not benefit the assessee as per MRF's case.

Upon review, it was found that the appellants maintained a uniform unit price in invoices to different buyers, irrespective of varied credit periods offered. Invoices did not claim interest from the delivery to payment date. Similar to Hindustan Lever Ltd., the absence of interest charged beyond the price led to the conclusion that the claimed "interest on receivables" was not a valid deduction from the assessable value, as lower authorities held. The appeal was dismissed accordingly.