2018 (3) TMI 484 - AT - Central Excise

Valuation - includibility - reimbursement expenses - advertisement expenses - Held that - the said advertisement was on behalf of the local dealers for the promotion of sale of the vehicles. Thus, it is reimbursement and its value cannot be included for the purpose of excise duty. It appears that matter is very old and it has already travelled upto the Hon ble Supreme Court. The genesis of the dispute was generated three decades before. Now it will not serve any useful purpose if we remand the case further to the adjudicating authority. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Levy of excise duty on advertisement expenses reimbursed by wholesalers.

Analysis:
The case involved an appeal against an order-in-appeal dated 30th January, 2009, concerning the period of dispute from 1984 to 1989. The appellant, a motor vehicle manufacturer, had sold vehicles to wholesale dealers who requested advertisements, with expenses reimbursed by them. A demand of &8377; 4,73,690 was raised by the department, arguing that the advertisement expenses should be included for excise duty levy as it increased business activity. The matter had reached the Hon'ble Supreme Court previously, which remanded it for fresh adjudication to determine if the amount was reimbursement or expenses. The adjudicating authority then reconfirmed the demand, stating that the advertisement enhanced marketability. The appellant, aggrieved by this decision, filed the present appeal.

During the hearing, the appellant's advocate and the department's representative presented their arguments. The Tribunal noted the age of the dispute, spanning three decades and having reached the Supreme Court previously. It was deemed unnecessary to further remand the case to the adjudicating authority. The Tribunal considered that the advertisements were made at the request of wholesale dealers, who reimbursed the expenses for local newspaper advertisements aimed at promoting vehicle sales. Therefore, the Tribunal concluded that the advertisement expenses were reimbursement and not to be included for excise duty purposes. Consequently, the impugned order was set aside, and the appeal filed by the appellant was allowed.

In conclusion, the Tribunal ruled in favor of the appellant, determining that the advertisement expenses reimbursed by wholesalers were not subject to excise duty levy. The decision was based on the finding that the advertisements were made on behalf of the local dealers for sales promotion, constituting reimbursement rather than expenses. The Tribunal set aside the demand raised by the department, ultimately allowing the appeal.