2018 (6) TMI 323 - AT - Central Excise

Time limitation - Valuation - inclusion of additional discount - Revenue challenged the extra discount given to these exporters on the ground that the appellants are receiving the extra consideration in the shape of intermediate advance license and therefore, the same amount to extra consideration and needs to be included in the value of the goods cleared for the purpose of payment of duty - Held that - Revenue wrote many letters but the appellant did not give the necessary information for issue of notice. Thus, in practical terms there was suppression of information specifically asked by Revenue - The appellant s action in not paying duty may be bona fide but in failing to furnish information it cannot be said to be bona fide. It was with obvious attempt to scuttle or delay the issue of notice - invocation of extended period justified. Valuation - includibility of the value of the intermediate advance license of extra consideration - Held that - It is seen from the price list of the appellant that they were offering the extra discounts subject to the buyer complying all the legal requirements for obtaining the advance license - From the remarks on the price list of the appellant, it is apparent that intermediate advance license was obtained at the desire of the appellant and thus, the argument of the appellant that the said intermediate license does not amount to consideration has no merit. Reliance placed in the decision of Apex Court in the case of IFGL Refractories Ltd. 2005 (8) TMI 112 - SUPREME COURT OF INDIA , where it was held that As the additional consideration was to flow to them as discounts, they have sold at the rates mentioned in the letter of 2nd March 1993. The additional consideration is the difference in prices between these two. The Commissioner had thus correctly worked out this difference. Appeal dismissed - decided against appellant.

Summary

Issues:
1. Inclusion of extra discount given to exporters in the value of goods for excise duty calculation.
2. Limitation period for demanding duty payment.
3. Allegations of suppression of facts and failure to provide data.
4. Bona fide belief of the appellant regarding the inclusion of intermediate advance license as extra consideration.
5. Justification for invoking the extended period for issuing the notice.

Analysis:

Issue 1:
The appellant argued that the extra discount given to exporters, linked to the transfer of intermediate licenses, should not be considered as extra consideration for excise duty calculation. The appellant relied on the Indian Contract Act to support their argument. However, the Tribunal held against the appellant, citing the decision of the Hon'ble Apex Court in a similar case.

Issue 2:
The appellant contended that part of the demand was time-barred, emphasizing revenue neutrality due to various modes of recovering the duty paid. The appellant argued that the extended period should not be invoked, referring to a specific decision of the Hon'ble Apex Court. They also highlighted previous interactions with the Revenue regarding the issue.

Issue 3:
The Revenue challenged the appellant's assertions, emphasizing lack of revenue neutrality and alleging suppression of information by the appellant. The Revenue pointed out various attempts to obtain data from the appellant, indicating a lack of cooperation from the appellant.

Issue 4:
The Tribunal analyzed the bona fide belief of the appellant regarding the inclusion of the intermediate advance license as extra consideration. The Tribunal considered the conflicting decisions of different cases and the sequence of events leading to the issuance of the notice. The Tribunal found that the Revenue was justified in invoking the extended period due to the appellant's failure to provide necessary information promptly.

Issue 5:
The Tribunal dismissed the appeal, upholding the decision against the appellant based on the precedents and legal interpretations presented during the proceedings. The judgment was pronounced on 23.05.2018, concluding the case.

This detailed analysis covers the key issues raised in the legal judgment, providing a comprehensive overview of the arguments presented by both parties and the Tribunal's reasoning leading to the final decision.