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TMI Blog2009 (12) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... confiscation of the goods has also been ordered and a fine in lieu of confiscation of Rs. 2.5 crores has also been imposed. Held that- The only ground on the basis of which the discount has been disallowed is that the same is not shown in the invoices and is not transparent. Further, as rightly observed by the Board in circular, Central Excise duty is payable on the net transaction value. The Department has not shown that no transaction value is shown in the invoice. Therefore, discount passed on by way of issue of credit note was admissible payment - no evidence produced to show that buyers did not know about it, and department not contending that discount was not passed by way of credit note held to be admissible. - Discount allowed to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted in 2007 (217) E.L.T. 367 (Tri.-Ahmd.), held that the duty is payable on such collection and also upheld confiscation of extended period and imposition of penalty. The observations of the Tribunal which are relevant are reproduced below for better appreciation : "7.3 Anybody including a manufacturer can act as transporter, as no special permission is required to act as a transporter. In such cases, if freight is collected for transportation at the option of the buyer, and collected from the buyer, such freight is excludable from assessable value. The case laws cited on behalf of the appellants support their case, that such extra money collected towards freight may not be included in the assessable value. The amount collected, at fixed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transportation cost" is only towards reimbursement of expenses on breakages and not towards insurance charges. (c) Admittedly no insurance is available from the insurance company in respect of breakages and the appellant is not an authorized insurer." 3. Shri V. Sridharan, learned advocate submitted that when the matter was considered by the Tribunal, the Tribunal had observed that during the relevant period, the amount recovered worked out to 7% of the sale value and therefore the claim by the appellant that the dealers had an option was illusory. The Tribunal had also observed that collection of charge of 7% did not appear to be optional. There is no denial that the appellant continued to charge 7%, but Shri V. Sridharan showed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , it is necessary to see whether the reliance of the Commissioner on the earlier order and his conclusions are correct. The Tribunal bad observed that during the relevant period, collection of 7% did not appear to be optional. This observation was made on the basis that the amount collected during the relevant period from Feb., '99 to Sept., '03 which worked out to 7% of the sale value. This was the basis for the conclusion of the Tribunal. We do not find a similar conclusion on the part of the Commissioner in his order. The claim of the appellant is that the buyer has an option. This option was, no doubt, available in 1999 also. But the observation of the Tribunal is that it was an illusory option and based on that fact, the conclusion was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant also relied upon the decision of the Tribunal in the case of M/s. Triveni Glass as reported in 2004 (178) E.L.T. 268 (Tri.-Del.) in support of their contention that the transportation and other cost incurred subsequent to sale of the goods at factory or depot need not be taken into consideration. The fact that the assessee had undertaken transportation and insurance of the goods alter their sale, cannot make a difference to the fact that the goods were sold ex-factory or ex-depot. It was also submitted by the learned advocate that the decision of the Hon'ble Supreme Court in case of Surya Roshni Ltd., 2000 (122) E.L.T. 3 (S.C.) is also not relevant in view of the fact that the bulbs and tubes were sold FOR destination in that case. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decisions of the Tribunal in this regard. Further, he also takes note of the fact that the Board's circular dated 30-6-2000, clearly states that the "transaction value" does not make any direct reference to discounts but in fact it is not needed by virtue of the fact that duty is chargeable on the net price paid or payable. Thus, he observed that if in any transaction, a discount is allowed on declared price of any goods and actually passed on to the buyer of the goods as per common practice, such discounts need not be included. He has disallowed the discount on the ground that the invoices does not show discount and it takes into account the future discounts which are passed on by way of issue of credit notes. Only discounts as payment inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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