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TMI Blog1995 (2) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... be considered in these appeals is whether interest on deposits and trade advances collected by the appellants from their buyers is to be included in the assessable value of the goods namely Electrical Resistance Wires manufactured by the appellants. 3. Shri S.R. Mukherjee, learned Advocate appearing for the appellants submitted that the appellants have two type of customers namely (1) consignee agent and (2) dealers. The appellant received trade deposit from consignee agent and trade advances from dealers. He said that the appellants had received deposits of Rs. 19.5 lacs on which they paid interest at 20% per annum on Rs. 12.5 lacs. The appellants had received these amounts as security against the supply of the goods to their customers. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reme Court in the case of Collector of Central Excise v. Indian Oxygen Ltd., [1988 (36) E.L.T. 730 (SC)] and Eicher Motors Ltd. v. Collector of Central Excise, 1992 (58) E.L.T. 90 (Tribunal). 3A. While countering the arguments Shri Satish Shah, learned JDR submitted that not even single sale has taken place without deposit and on the other hand every buyer whether he was consignee agent or a dealer was required to deposit before buying the goods which shows that there was nexus between the supply of goods and deposit. He said that it cannot be said that there was no mention in the show cause notice inasmuch as it was specifically charged in the show cause notice that the appellants have contravened the provisions by not adding the additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would otherwise have to borrow from the bank and to pay commercial bank interest thereon. The interest free deposit constitutes additional consideration in lieu of sale of the manufactured goods and hence interest accrued on such deposits will form a part of the assessable value of the goods. Reliance has been placed in the case of Britannia Industries Ltd. v. Union of India, [1989 (44) E.L.T. 630] wherein it was held that the interest payable/paid by the manufacturers on the deposits made by the customers is includible in the value and is not deductible from price to determine the value because the manufacturer would have incurred the said interest had he borrowed or taken loan from the banks. He also referred to the following decisions in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacturing excisable goods or they have kept the such deposits amount separately since they have collected as security deposit. The plea was taken by them that it has not been used but the same was not substantiated. In the circumstances it is a fact that the appellants received the advances/deposits from their customers, which certainly enhance the working capital and will effect the assessable value and advances and deposits are additional value flowing indirectly from buyers to the assessee, and therefore, this money value is to be determined by the quantum of interest as it was held in the case of Britannia Industries Ltd. (supra) and as it was rightly argued by the learned JDR. The decision in the case of Mahavir Aluminium Ltd. refe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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