2024 (10) TMI 1253 - AT - Central Excise

Valuation of Excise Duty - inclusion of excess freight collected by the appellant as compared to the actual freight paid to the transporter in the assessable value of the excisable goods for the purpose of charging excise duty - HELD THAT - This issue is no longer res-integra particularly in the appellant s own case this tribunal has held that in such case the freight is not includible in the assessable value. This Tribunal in KASHYAP SWEETNERS LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE ST, VAPI AND JITENDRA PANDEY VERSUS COMMISSIONER OF CENTRAL EXCISE ST, VAPI 2023 (7) TMI 1111 - CESTAT AHMEDABAD where it was held that ' excess freight collected by the appellant from the customers shall not be included in the transaction value for charging excise duty.' The demand in the present appeals is not sustainable - Hence, impugned orders are set aside, appeals are allowed.

Summary

Issues: Whether excess freight collected by the appellant should be included in the assessable value of excisable goods for charging excise duty.

Analysis:
The judgment by the Appellate Tribunal CESTAT Ahmedabad addressed the issue of including excess freight collected by the appellant in the assessable value of excisable goods for excise duty. The appellant's representative, a Chartered Accountant, argued that the issue had been settled in previous judgments and that the demand was time-barred. The representative cited several judgments, including those of CESTAT Ahmedabad and the Supreme Court, to support their argument. The Revenue's representative reiterated the findings of the impugned order.

Upon careful consideration of both sides' submissions and the records, the Tribunal found that the key issue was whether excess freight collected from customers should be part of the assessable value of excisable goods. The Tribunal noted that in a previous order concerning the same appellant, it was held that such excess freight should not be included in the assessable value. The Tribunal referenced a Supreme Court judgment to support this position, emphasizing that excess freight is profit from transportation and not part of the goods' value. The Tribunal further explained that this principle applied even after the amendment to relevant laws post-2000.

Based on the judgments cited by the appellant's representative and the precedent set in the appellant's own case, the Tribunal concluded that the excess freight collected should not be included in the transaction value for excise duty purposes. The Tribunal set aside the impugned orders and allowed the appeals. The decision was made on the merits of the case, without addressing other alternative submissions by the appellant's representative. Consequently, the demand in the appeals was deemed unsustainable, and the impugned orders were overturned, allowing the appeals.

In light of the Tribunal's decision, supported by various judgments and legal precedents, the issue regarding the inclusion of excess freight in the assessable value of excisable goods was deemed settled in favor of the appellant. The Tribunal's ruling, delivered on 23.10.2024 in open court, concluded that the demand in the present appeals was not sustainable, leading to the setting aside of the impugned orders and allowing the appeals.