2013 (11) TMI 1463 - AT - Central Excise

Inclusion of Transportation charges to the assessable value Held that - Following CCE, Madurai vs. TCP Ltd. 2010 (9) TMI 488 - CESTAT, CHENNAI - During the period October, November 2000, depot was not included in the place of removal definition and as such there is no question of inclusion of freight charges up to the depot, in the assessable value of their final product. Extended period of limitation Held that - The declaration filed by the assessee discloses that the transportation charges are not being included in the assessable value - the entire information stands given by the appellant to their jurisdictional Range office, at the time of filing the declaration in terms of Rule 173C there was no malafide, with intent to evade payment of duty - Thus, the extended period was not available to the Revenue Decided in favour of Assessee.

Summary

Issues:
1. Inclusion of transportation charges in the assessable value of goods.
2. Point of limitation for raising demand of duty.

Issue 1: Inclusion of transportation charges in the assessable value of goods

The appellant, a public sector undertaking manufacturing cotton yarn, faced two show cause notices alleging non-inclusion of transportation charges in the assessable value of goods. The first notice demanded duty for a specific period in 2000, while the second notice covered a period from 1996 to 1999. The original Adjudicating Authority and Commissioner (Appeals) upheld these notices.

Upon review, the Tribunal found that during the period in question in 2000, the depot was not considered part of the place of removal definition. Therefore, the inclusion of freight charges up to the depot in the assessable value was not warranted. This interpretation was supported by a previous Tribunal decision. Regarding the second notice, the appellant's declaration revealed a marketing pattern through depot/branch offices without including transportation charges in the assessable value. This information was provided to the jurisdictional Range office at the time of filing the declaration under Rule 173C, indicating no intent to evade duty payment. Consequently, the Tribunal held that the extended period for raising the demand was not available to the Revenue.

As a result of the analysis, the Tribunal set aside the impugned order and allowed the appeal, providing consequential relief to the appellant.

Issue 2: Point of limitation for raising demand of duty

The second show cause notice raised a demand of duty for a period spanning from 1996 to 1999. The appellant contested this notice on the grounds of limitation. The Tribunal examined the declaration filed by the appellant, which outlined the marketing pattern and the exclusion of transportation charges from the assessable value. This information was transparently provided to the jurisdictional Range office during the declaration process under Rule 173C. Based on this disclosure and the absence of any intent to evade duty payment, the Tribunal concluded that the extended period for raising the demand was not applicable to the Revenue.

Consequently, the Tribunal ruled in favor of the appellant, setting aside the impugned order and granting relief in the appeal.

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