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2015 (4) TMI 73 - SC - Central ExciseValuation of goods - includibility of the cost of transportation charges - Held that - Tribunal has arrived at a categorical finding that the respondent is not responsible to pay the cost of transport from the place of removal to the place of delivery i.e. from the factory gate to the depot separately. In terms of Rule 5 of the Central Excise Valuation (Determination of price of Excisable Goods) Rules, 2000, such a cost of transport which is also separately shows, is not includable in the valuation for the purpose of excise duty. - no error in the judgment of the Tribunal - Decided against Revenue.
Issues:
Inclusion of transportation charges in the transaction value under Central Excise Valuation Rules. Analysis: The judgment deals with the issue of the includibility of transportation charges in the transaction value of goods under the Central Excise Valuation Rules. The respondent, a manufacturer of cold rolled/galvanized products, was involved in the clearance of final products directly to customers at the factory gate and stock transfers to various depots. The assessee had filed price declarations stating that the stock transfer price included freight from the factory gate to the depot. The revenue department issued show cause notices and demanded amounts totaling &8377; 1,09,26,360 /-. The Commissioner imposed penalties under Rule 25 and 11AC of the Central Excise Act, 1944. The respondent appealed the Commissioner's order before the Tribunal, which allowed the appeal based on circular No.354 /81/2000- TRU dated 30.06.2000. The Tribunal found that the respondent was not liable to pay the cost of transport separately from the factory gate to the depot. The Tribunal's decision was based on Rule 5 of the Central Excise Valuation Rules, which states that such transport costs, if separately shown, are not includable in the valuation for excise duty purposes. The Supreme Court upheld the Tribunal's decision, stating that there was no error in the Tribunal's judgment. The appeals were dismissed, affirming that the cost of transport from the factory gate to the depot need not be included in the valuation for excise duty purposes as per Rule 5 of the Central Excise Valuation Rules.
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