2016 (1) TMI 697 - AT - Central Excise

Valuation of goods - Inclusion of cylinder rental charges, testing charges in assessable value - transaction value - Held that - The issue was decided in Goyal M.G. Gases Pvt. Ltd. vs. CCE, Ghaziabad 2014 (8) TMI 657 - CESTAT NEW DELHI wherein held in the cases where the gases were supplied in the cylinders brought by the customers, it is not disputed that the gases, in question, were marketable as such in as much as a substantial quantity of the gases was being supplied in tankers as well as through pipe line and also in the cylinders brought by the customers and as such, the packing of the gases into cylinders is not necessary for making the gas marketable. In view of this factual matrix, the ratio of the Tribunal s decision in the case of CCE vs. Grasim Industries Ltd. 2003 (12) TMI 101 - CESTAT, NEW DELHI would be applicable to this case and these charges would not be includible in the assessable value - Decided in favour of assessee.

Summary

Issues:
Whether cylinder hire charges, repair charges, and testing charges collected by the manufacturer are includible in the assessable value for the purpose of duty payment.

Analysis:
The case involves the issue of whether charges collected by M/s Inox Air Products for cylinder hire, repair, and testing should be included in the assessable value for duty payment. The Department contended that these charges should be included based on the definition of 'transaction value.' A show cause notice was issued, but the Original Authority dropped the demand citing a Tribunal decision in Grasim Industries vs. CCE, Indore. The Department appealed, and the Commissioner (Appeals) upheld the Original Authority's decision. The Revenue then appealed to the Tribunal.

The Tribunal referred to the case of Goyal M.G. Gases Pvt. Ltd. vs. CCE, Ghaziabad, where it was held that cylinder rental and maintenance charges need not be included in the assessable value if the gases were marketable without being packed into cylinders. The Tribunal followed the decision in Grasim Industries case and concluded that the charges in question should not be included in the assessable value. Therefore, the Tribunal found no reason to interfere with the impugned order and dismissed the appeal.

In summary, the Tribunal held that cylinder hire charges, repair charges, and testing charges collected by M/s Inox Air Products need not be included in the assessable value for duty payment. The decision was based on precedents and the marketability of the gases supplied by the manufacturer. The appeal by the Revenue was dismissed, affirming the decision of the Commissioner (Appeals) and the Original Authority.