2007 (6) TMI 510 - AT - Central Excise

Summary

Issues:
- Challenge to deduction of machine user charges for calculating assessable value for excise duty.
- Challenge to denial of deduction for transportation expenses in arriving at assessable value for excise duty.

Analysis:
1. Deduction of Machine User Charges:
- The appeals involved challenges by the Revenue regarding the deduction of machine user charges and transportation expenses from the assessable value for excise duty purposes.
- The Tribunal referred to its decision in Dhillon Cool Drinks and Beverages v. CCE, Jalandhar, where it was held that deductions for machine hire charges and repair and maintenance charges are permissible.
- Citing the decision in Pepsico India Holdings Pvt. Ltd. v. CCE, Mumbai, the Tribunal emphasized that charges for leasing dispensing machines are not includible in the assessable value of goods.
- Following these precedents, the Tribunal concluded that there was no justification for denying the deduction of machine user charges incurred by the respondent/assessee.

2. Transportation Charges Deduction:
- The appellant challenged the denial of deductions for transportation charges, arguing that the freight was based on an accepted principle of accounting.
- The Commissioner had required the manufacturer to produce relevant documents proving that the freight was charged on an equalized basis as per accepted accounting principles.
- The appellant cited decisions in Escorts JCB Ltd. v. CCE, Delhi, and Motorola India Pvt. Ltd. v. CCE, Bangalore, to support their claim that transportation charges should be deductible.
- The Tribunal noted that the relevant records and invoices supporting the transportation charges had not been adequately considered in the impugned order.
- Consequently, the Tribunal remanded the matter for reconsideration by the Commissioner (Appeals) in light of the evidence provided by the appellant and the legal principles cited in the aforementioned cases.

3. Judgment Outcome:
- The appeals filed by the Revenue (Nos. 1852/2006, 2778/2006, and 565/2007) were dismissed.
- However, in Appeal No. 939/2006 filed by the appellant/assessee, the Tribunal set aside the portion of the order related to transportation charges and remitted the matter to the Commissioner (Appeals) for further consideration based on the relevant material presented and the legal precedents referenced by the appellant.

This detailed analysis of the judgment highlights the key issues, legal interpretations, precedents relied upon, and the ultimate outcome for each challenge raised in the appeals before the Appellate Tribunal CESTAT NEW DELHI.