1979 (8) TMI 80 - CGOVT - Central Excise

Summary

Issues:
1. Inclusion of cost of die-cast in the assessable value of aluminium extrusions under the Central Excises and Salt Act, 1944.
2. Applicability of Rule 10A of the Central Excise Rules, 1944 for the recovery of sums due to the Government.

Analysis:
1. The judgment revolves around the inclusion of the cost of die-cast in the assessable value of aluminium extrusions under the Central Excises and Salt Act, 1944. The Government observed that the petitioners were recovering the cost of die-cast from customers and appropriating it if certain conditions were not met. The Government held that this additional consideration should be included in the assessable value under the amended Section 4 of the Act. For the period before the amendment, the assessable value should also include the cost of die-cast as it was part of the price at which the extrusions were capable of being sold. The Government's decision was based on the premise that the price charged was not the sole consideration for the sale, as the cost of die-cast was also being recovered.

2. The judgment also addressed the applicability of Rule 10A of the Central Excise Rules, 1944 for the recovery of sums due to the Government. The Government found that the demands raised under Rule 10A were justified as it provided for the recovery of sums where specific provisions were lacking. The petitioners' argument that Rule 10, not Rule 10A, should apply was deemed untenable by the Government, as the recovery of the cost of die-cast was not explicitly mentioned in the price list. Therefore, the Government upheld the correctness of the order-in-appeal and rejected the Revision Application.

Editor's Comments:
The editor criticized the Government's interpretation of Section 4 and the application of Rule 10A. The editor argued that the price charged at the time of removal, without reservation for adjustment, should constitute the assessable value, regardless of additional considerations like the cost of die-cast. The editor highlighted that the forfeiture of the die cost deposit was a separate commercial matter and should not influence the assessable value for excise purposes. Additionally, the editor referenced a case to support the view that Rule 10, not Rule 10A, should apply in situations where incorrect information is provided. The editor disagreed with the Government's decision and provided a contrasting interpretation of the legal provisions involved in the case.