2000 (9) TMI 768 - AT - Central Excise

Summary

Issues:
Valuation of Light Commercial Vehicles (LCVs) manufactured by the appellants.

Analysis:
The judgment pertains to the valuation of LCVs manufactured by the appellants, who sell the goods both in wholesale and retail to customers. The issue raised in the appeals concerns the deduction sought by the appellants from the higher retail price declared in Part V proforma. The impugned order disallowed the deduction of Rs. 5,000 from the retail price and directed duty payment at the higher value without the deduction. The appellants contended that the orders violated the valuation provisions under Section 4 of the Central Excise Act and Central Excise (Valuation) Rules. They argued that the wholesale price declared in Part I proforma should have been approved for assessment purposes, as per established legal principles. They cited precedents such as A.K. Roy v. Voltas Ltd. and other tribunal decisions to support their stance that wholesale price should constitute the assessable value.

The appellants further argued that assessing goods at retail price without adjusting to correspond to wholesale price was impermissible. They emphasized that the law mandates deriving the retail price by making deductions to align it with the wholesale price for assessment. They referenced Supreme Court and tribunal decisions like Modi Xerox v. CCE to support this argument. The appellants contended that the impugned order, which directed assessment at retail price without adjustments, contradicted established legal principles. They sought the assessment of goods at the wholesale price at the factory gate, as approved by the Central Excise authorities.

The Tribunal, after considering the submissions, ruled in favor of the appellants. It held that the LCVs were sold in wholesale at the factory gate, and the prices declared in Part I proforma rightly constituted the assessable value. The judgment affirmed that when wholesale price at the factory gate is available, it should be adopted for assessing goods sold in retail as well. Therefore, the goods were to be assessed to duty at the wholesale prices declared in Part I proforma, and the retail prices in Part V proforma were deemed irrelevant in this context. The Tribunal emphasized that the Central Excise authorities could not adopt retail prices without adjustments when wholesale prices existed. Consequently, the appeals were allowed, and the impugned orders were set aside, directing assessment of all goods at wholesale prices as declared in Part I proforma.