2009 (8) TMI 918 - AT - Central Excise

Summary

Issues involved: Whether the discount passed on to buyers should be included in the assessable value for taxation purposes.

Summary:
The Revenue appealed against a decision by the Commissioner that the discount passed on to buyers should not be included in the assessable value. The Revenue argued that the manner of granting the discount was unknown and relied on a circular to support their position. On the other hand, the Respondent contended that the discounts were part of their trade policy to boost sales, and that the discounts did not result in any unlawful practices or prejudice the revenue. The Respondent cited various court decisions to support their stance.

After hearing both sides and examining the evidence, the Tribunal found that there was no evidence to suggest that the discounts unduly benefited buyers or that there was any flow back of value to the seller. The Tribunal noted that the circular provided by the Respondent indicated that the discounts were part of an incentive scheme for boosting sales. As there was no unintended benefit to the Respondent and no evidence of any wrongdoing, the Tribunal upheld the decision of the Commissioner to grant relief to the Respondent. The Revenue's appeal was dismissed.