2016 (8) TMI 779 - AT - Central Excise

Valuation - adoption of higher value of goods - Commission not included in the assessable value - Held that - it is found that the identical dispute was the subject matter in that case and it was held that even though duty was required to be paid on the goods exported, rebate of equal amount was available to the assessee so as reaching the revenue neutral situation. In such a scenario, the confirmation of duty was set aside. - Decided in favour of appellant

Summary

Issues:
1. Claim of rebate on duty paid by the appellant for exported goods.
2. Inclusion of commission in the assessable value of goods for duty calculation.
3. Revenue neutrality in case of duty payment and rebate availability.

Analysis:
1. The appellant, engaged in the manufacture of SS wire and power cables, exported goods under the claim of rebate after paying duty as per Rule 18 of Central Excise Rules. The rebate was claimed, examined, and granted to them, establishing their compliance with the duty payment regulations for exported goods.

2. A Show cause notice was issued proposing the adoption of a higher value of goods due to the appellant not including commission in the assessable value. The Commissioner confirmed this decision along with interest and penalty imposition. The appellant argued that even if the commission was to be added to the assessable value, resulting in a higher duty rate, they were entitled to claim a rebate, making the entire process revenue neutral.

3. The appellant's Advocate cited a Tribunal decision in a similar case, Sterlite Industries (India) Ltd. vs. Commissioner, which was upheld by the Bombay High Court. The Tribunal found that in situations where duty was required to be paid on exported goods, but an equal rebate was available, the revenue remained neutral. Citing this precedent, the Tribunal set aside the confirmation of duty and allowed the appeal on the grounds of revenue neutrality, as the issue was settled and the appellant was entitled to the rebate.

This judgment highlights the importance of ensuring revenue neutrality in duty payment and rebate claims for exported goods, as established through legal precedents and interpretations of relevant regulations.