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2017 (7) TMI 837 - AT - Central ExciseValuation - petroleum products - whether the petroleum products cleared from warehouse to company owned and company operated outlets are to be valued in terms of Section 4(1)(b) of the Central Excise Act, 1944 read with Rule 7 of the Central Excise Valuation Rules? - Held that - this issue has been settled in favour of the appellant by various decisions of the Tribunal specifically, in the case of BPCL 2007 (8) TMI 137 - CESTAT, BANGALORE , where Appellant PSU unit had removed goods to their sales outlets under Administrative Pricing Mechanism but revenue rejected the same and demand raised by applying Section 4(4)(b)(iii) of CEA,1944 and Section 4(1)(b)ibid in two distinct period for valuation purpose, Valuation of appellant accepted and demand set aside - appeal allowed - decided in favor of appellant.
Issues:
Valuation of petroleum products cleared to company-owned outlets under Central Excise Act, 1944. Analysis: The appeals were filed against the impugned order passed by the Commissioner (Appeals) regarding the valuation of petroleum products cleared to company-owned outlets. The details of both appeals were presented, showing duty demanded and the respective dates. The case revolved around the inclusion of FDZ charges and SSLF in the assessable value of products, as well as the adoption of retail price for clearances to COCO outlets. The adjudicating authority demanded duty under Section 11A of the Central Excise Act, 1944, based on various charges and prices applied. The Commissioner (Appeals) set aside the demand on FDZ charges and SSLF but upheld the demand related to the price at COCO RPO, directing re-quantification. The issue in question was whether petroleum products cleared to company-owned outlets should be valued under Section 4(1)(b) of the Central Excise Act, 1944. The Department argued for valuing based on the price at which goods are sold from COCO outlets, while the appellants cited previous cases in their favor, emphasizing the adoption of transaction value and exclusion of certain charges from the assessable value. The Tribunal considered submissions from both parties and reviewed relevant decisions, including those favoring the appellants. Citing the case of BPCL [2007(218) ELT 585 (Tri. Bang.)], upheld by the Supreme Court in 2016(335) ELT A26, the Tribunal found the issue settled in favor of the appellants. It was noted that the COCO outlets were not considered a place of removal, and the conditions for adopting transaction value were met. The Tribunal concluded that the impugned orders were not sustainable in law and set them aside, allowing the appeals of the appellants with any consequential reliefs. The judgment was delivered by the Tribunal, emphasizing the settled nature of the issue based on previous decisions and legal interpretations. The Tribunal's decision favored the appellants, providing relief from the disputed valuation of petroleum products cleared to company-owned outlets. The legal analysis focused on the application of relevant provisions of the Central Excise Act, 1944, and the interpretation of valuation rules in light of specific charges and pricing mechanisms involved in the case. Overall, the judgment clarified the valuation methodology for such transactions, ensuring compliance with legal standards and established precedents.
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