2017 (3) TMI 293 - AT - Central Excise

Valuation - whether the erection & commissioning charges of said Sugar Plant & Machinery at the site of customer should be included in the assessable value or not? - Held that - similar issue decided in the case of Commissioner of Central Excise, Mumbai Versus Official Liquidator for Brimco Plastic Machinery (P) Ltd. 2015 (10) TMI 2281 - SUPREME COURT wherein it was held that the installation, erection & commissioning charges are not added/included in the assessable value for determination of Central Excise duty - appeal allowed - decided in favor of appellant.

Summary

Issues:
Inclusion of erection & commissioning charges in the assessable value for Central Excise duty.

Analysis:
The appeal was filed against an Order-in-Appeal by M/s R R Heavy Engineering Co. challenging the inclusion of erection & commissioning charges in the assessable value for Central Excise duty. The Revenue contended that these charges should be included, leading to a Show Cause Notice and subsequent adjudication. The Original Authority upheld the demand and penalty, which was further upheld by the Commissioner (Appeals). The appellant argued citing a Supreme Court ruling that such charges should not be included in the assessable value for Central Excise duty.

Upon hearing both parties, the Tribunal examined whether erection & commissioning charges should be included in the assessable value for Central Excise duty. Reference was made to the Supreme Court ruling in the case of Commissioner of Central Excise, Mumbai versus Official Liquidator for Brimco Plastic Machinery (P) Ltd., which held that such charges should not be added to determine the assessable value. The Tribunal also highlighted previous judgments supporting this position, emphasizing that expenses incurred post-clearance should not be considered for assessable value calculation.

Based on the legal precedents and the Supreme Court ruling, the Tribunal concluded that the erection & commissioning charges should not be included in the assessable value for Central Excise duty. Consequently, the impugned Order-in-Original and Order-in-Appeal were set aside, and the appeal was allowed. The appellant was granted consequential relief as per the law. This decision was made in line with the principles established by the Supreme Court and previous judgments on the matter.