2017 (2) TMI 884 - AT - Central Excise

Valuation - The handling charges has been collected by the appellant over and above the transaction value and would normally form part of the transaction value - Held that - It has been stated in the appeal memo that they have in the declaration in 173C(3A) declared that they were collecting this amount and therefore there is no suppression - It has been seen that the said declaration is only for octroi and freight charges and does not cover handling charges - Appeal dismissed.

Summary

Issues:
Appeal against demand of duty for handling charges collected on goods cleared.

Analysis:
The appellant, a company, appealed against the demand of duty on handling charges collected on goods cleared by them, which was confirmed by lower authorities. The appellant argued that they had recovered only a specific amount as handling charges and had given discounts exceeding this amount. However, the Tribunal found no valid reason for collecting 0.5% as handling charges, noting that this amount was collected over and above the transaction value and should normally be part of the assessable value. The appeal did not provide any grounds to exclude this amount from the assessable value. The Tribunal highlighted that the appellant's declaration in Form 173C(3A) acknowledged the collection of this amount, indicating no suppression. The Tribunal also examined the declaration, which specifically mentioned charges for octroi and freight but did not cover handling charges. Consequently, the Tribunal dismissed the appeal, stating that the appellant's claim was unfounded.

This judgment underscores the importance of justifying additional charges collected beyond the transaction value and their inclusion in the assessable value for duty calculation. The Tribunal emphasized the significance of declarations made by the appellant in determining the applicability of extended periods for invoking duty demands. The case serves as a reminder for businesses to ensure transparency in their declarations and to provide valid reasons for any additional charges levied to avoid disputes regarding assessable values and duty liabilities.