2023 (9) TMI 1010 - AT - Service Tax

Valuation of service tax - supply of tangible goods service - inclusion of charges recovered from the customers on account of delay in return of cylinders in the assessable value - HELD THAT - The identical issue has been decided in appellant s own case in AIMS INDUSTRIES LTD VERSUS C.C.E. -AHMEDABAD-I 2023 (1) TMI 5 - CESTAT AHMEDABAD where it was held that retention/detention charges is not a part of the sale price. It is only charged when the customers retain/detain the cylinders beyond the period stipulated by the appellant. Accordingly, the retention/detention charges are not includable in the transaction value of the excisable goods namely gas sold, duly packed, in the gas cylinders. The impugned order is set aside. Appeal is allowed.

Summary

Issues involved: Appeal against demand of Service Tax for charges recovered from customers on account of delay in return of cylinders under the category of supply of tangible goods service.

Summary:
The appeal was filed against the demand of Service Tax for charges levied on customers for delay in returning cylinders used for supplying gas. The appellant argued that similar issues had been decided in their favor in previous cases. The Authorized Representative relied on the impugned order. The Tribunal found that the issue had already been settled in the appellant's favor based on previous judgments, including the Supreme Court judgment in the case of Grasim Industries Ltd. The Tribunal held that retention/detention charges are not part of the sale price and are only charged when customers retain or detain the cylinders beyond the stipulated period. Therefore, the charges are not includable in the transaction value of the gas sold in cylinders. The impugned order was set aside, and the appeal was allowed based on the previous decisions and the Supreme Court judgment in the case of Grasim Industries Ltd.

The Tribunal pronounced the decision on 19th September 2023, setting aside the impugned order and allowing the appeal.