2016 (10) TMI 227 - AT - Central Excise

Valuation - Transaction value under Section 4 of Central Excise Act, 1944 - whether an amount charged over and above the sale price shown in central excise invoice as erection and commission charge is includable in the assessable value or otherwise? - Held that - the issue is no more res integra as identical issue in the case of Petals Engineers Pvt Ltd. Versus Commissioner of Customs & Central Excise, Goa 2016 (3) TMI 570 - CESTAT MUMBAI is decided where it was held that erection charges and integration and commissioning of machinery are not includable in the assessable value as they are not related to the sale of goods but for independent and distinct identified activity - appeal allowed - decided in favor of appellant.

Summary

Issues involved: Whether amount charged as erection and commission charge over and above the sale price shown in central excise invoice is includable in the assessable value.

The judgment addresses the issue of whether an additional amount charged as erection and commission charge should be included in the assessable value for central excise duty calculation. The appellant, a machinery supplier, invoiced customers for machinery along with a separate charge for erection during a specific period. The revenue argued that such charges should be included in the assessable value. However, referencing a previous case, the Tribunal found that charges for erection and commissioning are not related to the sale of goods but are distinct activities. The Tribunal cited a Supreme Court decision supporting this view, stating that post-clearance activities like installation cannot be included in the assessable value. Consequently, the Tribunal ruled in favor of the appellant, setting aside the impugned order and allowing the appeal with any consequential relief. The judgment provides a clear interpretation of the law regarding the inclusion of additional charges in the assessable value for central excise duty calculation, emphasizing the distinction between sale value and post-clearance activities like erection and commissioning.