2011 (7) TMI 1044 - AT - Central Excise

Valuation - Demo Cars - comparable prices - demand on the ground that their price was lower than the price fixed for other cars and hence the price was not the sole consideration for sale - Held that - The assessees have not been able to demonstrate any difference between the demo cars / normal cars sold through dealers. The demo cars are put to test and usage as desired by prospective buyers and the assessees also permit such usage to enhance the marketability of their cars - the transaction value cannot be accepted and comparable price adopted for other cars (other than demo cars ) has correctly been adopted and differential duty charged thereon - demand of duty with interest upheld. Penalty - Held that - The penalty is not warranted as the assessees received and paid the duty on the transaction value and the demands are also within the normal period of limitation - penalty set aside. Appeal allowed in part.

Summary

The duty demands on 'demo cars' were confirmed, but penalties were set aside as the transaction value was not accepted. The appeals were partly allowed.