2011 (4) TMI 1197 - AT - Central Excise

Transaction value - whether the charge towards pre-delivery inspection and after sales service by the dealers from the buyers of the cars are to be included in the assessable value of the cars - Held that - The same stands already answered by the Larger Bench in this very case under order dated 20.4.2010 against the contention sought to be raised by the assessee - Decided against the assessee. Quantification of duty and interest - Held that - The same will have to be calculated by the adjudicating authority bearing in mind the decision of the Larger Bench - Therefore, the matter will have to be remanded for that purpose. Penalty - Held that - Once it is undisputed fact that there were divergent views expressed by different Benches on the issues and the same had to be settled by the decision of the Larger Bench, the appellants cannot be held liable to pay the penalty - Thus, it cannot the said that there was any intention to evade payment of duty - Hence we set aside the penalty levied.

Summary

Issues involved:
Whether charges for pre-delivery inspection and after-sales service by car dealers should be included in the assessable value of cars under Section 4(3)(d) of the Central Excise Act, 1944. Quantification of duty liability, interest, and penalty.

Analysis:

Issue 1: Inclusion of charges in assessable value
The judgment states that the issue of including charges for pre-delivery inspection and after-sales service in the assessable value of cars has been previously addressed by the Larger Bench. The contention raised by the assessee has been settled by the Larger Bench's order dated 20.4.2010. Therefore, the primary question has already been resolved, and the focus now shifts to quantifying the duty liability, interest, and penalty.

Issue 2: Quantification of duty liability and interest
The judgment highlights that the calculation of duty liability and interest must be done by the adjudicating authority in accordance with the decision of the Larger Bench on the inclusion of charges in the assessable value. This aspect requires a remand to the adjudicating authority for proper calculation based on the legal interpretation provided by the Larger Bench.

Issue 3: Penalty imposition
Regarding the penalty, the judgment emphasizes that since there were conflicting views among different Benches on the issues at hand, which were ultimately resolved by the Larger Bench, the appellants cannot be penalized. It is noted that there was no intention to evade duty payment, leading to the setting aside of the penalty imposed on the appellants.

Conclusion:
The judgment concludes by disposing of the appeal in line with the Larger Bench's order, which includes setting aside the penalty and remanding the matter to the adjudicating authority for recalculating the duty liability and interest payable by the appellants. The decision ensures that the appellants are not penalized due to the conflicting interpretations and clarifications provided by the Larger Bench.