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2018 (9) TMI 487 - AT - Central ExciseValuation - inclusion of VAT subsidy in the assessable value - Section 4 of the Central Excise Act, 1994 - Held that - Identical issue decided in the case of GREENLAM INDUSTRIES LTD 2018 (4) TMI 1552 - CESTAT NEW DELHI , where it was held that There is no justification for inclusion in the assessable value, the VAT amounts paid by the assessee using VAT 37B Challans - appeal allowed - decided in favor of appellant.
Issues:
Inclusion of VAT subsidy in assessable value for Central Excise duty under Section 4 of the Central Excise Act, 1994. Analysis: The appeal arose from an Order-in-Appeal confirming a demand of &8377;6,83,765 on the issue of including VAT subsidy in the assessable value for Central Excise duty. The appellant contested the demand, citing previous judgments where such subsidies were held not includable in the assessable value. The Tribunal considered the issue covered by a previous Final Order, which outlined the dispute regarding the inclusion of subsidy amounts in the assessable value of goods manufactured by the appellants under Section 4 of the Central Excise Act. The Tribunal noted that the appellants were required to discharge their VAT liability, and a portion was disbursed back to them as subsidies. The crux of the matter was whether such subsidies should be included in the assessable value. The Tribunal referred to a Supreme Court decision stating that unless VAT is actually paid to the government, no benefit towards excise duty can be given. However, the Tribunal distinguished this in light of a previous case where subsidy amounts were not required to be included in the transaction value. The Tribunal further elaborated that the VAT amounts paid by the assessee using VAT 37B Challans were considered legal payments of tax under the Rajasthan Government's scheme. Referring to a previous case, the Tribunal concluded that there was no justification for including VAT amounts paid using such Challans in the assessable value. Therefore, the impugned orders were set aside, and the appeals were allowed, following the earlier Final Order of the Tribunal on the same issue.
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