1998 (8) TMI 281 - AT - Central Excise

Summary

Issues:
1. Admissibility of deduction of the cost of Instruction Manual, Freight, and Insurance charges in the determination of assessable value for excisable products.

Analysis:
The appeal before the Appellate Tribunal CEGAT, New Delhi challenged the Order-in-Appeal passed by the Collector (Appeals) Bombay, confirming the Order in Original passed by the Assistant Collector, Central Excise, Goa. The dispute revolved around the admissibility of deductions for the cost of Instruction Manual, Freight, and Insurance charges in the determination of the assessable value of the excisable product, which in this case was a Photo Camera.

The Tribunal held that the Instruction Manual and leather case could be considered as admissible deductions as they were not component parts of the photo camera. Referring to a Supreme Court case, it was established that the cost of accessories, even if sold with the product, cannot be included in the assessable value if they are not component parts. Therefore, the deduction for the cost of the manual and leather case was deemed admissible.

Regarding the freight and insurance charges, the Tribunal noted discrepancies in the documentation provided by the appellant. While the appellant claimed that the charges were equalised, the evidence presented did not conclusively prove this assertion. The Tribunal emphasized that if any deduction based on a percentage of the price was claimed for freight and insurance, it was the appellant's responsibility to substantiate this claim. The certificate from a Chartered Accountant, which was mentioned but not adequately addressed by the Collector (Appeals), was considered crucial evidence for establishing the deduction. As the Collector (Appeals) did not consider this material, the Tribunal set aside the order in this regard.

In conclusion, the Tribunal allowed the appeal, setting aside the Collector (Appeals)'s order and remanding the case to the jurisdictional Commissioner (Appeals) for a fresh decision on the admissibility of the claim for deduction of freight and insurance charges. The Commissioner (Appeals) was directed to consider the certificate of the Chartered Accountant and provide the appellant with an opportunity for a hearing before issuing a new order on the matter.