1990 (10) TMI 224 - AT - Central Excise

Issues:
Review of order allowing lower value for assessment of plywood of 15 mm non-decorative Block Boards.

Analysis:
The appeal before the Appellate Tribunal concerned the review of an order passed by the Appellate Collector, which allowed a lower value for the assessment of plywood of 15 mm non-decorative Block Boards manufactured by the appellants and sold through their depots. The primary argument raised by the Revenue was that the impugned order was incorrect as there was no valid basis for the downward revision of the value determined by the Assistant Collector. On the other hand, the respondent's advocate contended that while factory-gate prices for 18 mm and 25 mm Block Boards were approved by the Assistant Collector, the price for 15 mm Block Boards sold through depots was fixed without any abatement, resulting in an illogical higher assessment. The advocate further argued that the higher price for the thinner Block Board was based on the gross sale price at Calcutta, which was not justifiable.

The Tribunal considered the arguments presented by both sides and reviewed the facts of the case as outlined in the Review Notice. The Notice highlighted that the normal price of 15/16 mm non-decorative Block Boards could not be ascertained at the factory gate, leading to the consideration of prices at the place of delivery based on sale bills. The Assistant Collector requested documentary evidence for actual transportation expenses, which the firm failed to provide, leading to the inclusion of expenses realized from buyers in the assessable value. The Appellate Collector allowed the appeal, emphasizing that the expenses charged separately were identifiable from the sale bills, and there was no justification for fixing separate values at higher rates. However, upon examination, the Government tentatively held the view that the order-in-appeal was not legally sound as the firm failed to prove actual transportation expenses, and the declared expenses included non-deductible items.

The Tribunal noted that the impugned order did not address the examination of eligible deductions before determining the value. It was observed that no deductions were allowed from the gross sale price at Calcutta, leading to the assessment of the thinner 15 mm Block Board at a higher value, contrary to the norm. The Tribunal emphasized the established principle that when the price is unascertainable at the factory gate, the normal price should be derived from sales depot prices after deducting admissible items like transport and insurance. Since this procedure was not followed by the Assistant Collector or the Appellate Collector, the Tribunal set aside the impugned order and remanded the matter to the Assistant Collector for a reevaluation. The Assistant Collector was directed to consider the appellants' pleas, fix the normal price in compliance with the law, and allow deductions as per legal provisions.

In conclusion, the appeal was allowed by remand, emphasizing the importance of determining the normal price accurately and allowing for permissible deductions in the assessment process.

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