9911796707
TMI Blog2002 (3) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... to it, the jurisdictional Assistant Commissioner held that such cost was includible. This appeal is against the order of the Commissioner (Appeals) confirming this conclusion, and therefore the duty payable, and setting aside the penalty that the Assistant Commissioner has imposed on the appellant. 2. Prior to amendment in 1996 of Section 4 of the Act, the assessable value was the price at which the goods were sold at the factory gate of the manufacturer for sale in the course of wholesale trade. This was the normal price referred to in clause (a) of sub-section (1) of Section 4. Sub-section (2) specifically excluded the cost of transportation from the place of removal to the place of delivery, in cases where the value of the excisable go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods are ordinarily sold by the assessee is different for different places of removal, each such price shall, subject to the existence of other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each such place of removal. The definition of the term place of removal contained in sub-section (4) was modified, so as to include a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory gate, and from where such goods are removed. 4. The effect of this amendment would be that where the manufacturer sold part or all of its goods for delivery from depot or any other such place, it is that price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the expenses incurred by the assessee up to the date of delivery under the aforesaid heads cannot, on the same grounds, be deducted. But the assessee will be entitled to a deduction on account of the cost of transportation of the excisable article from the factory gate to the place or places where it is sold. The cost of transportation will include the cost of insurance on the freight for transportation of the goods from the factory gate to the place or places of delivery. 50. Where freight is averaged and the averaged freight is included in the wholesale cash price so that the wholesale cash price at any place or places outside the factory gate is the same as the wholesale cash price at the factory gate, the averaged freight included in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... livery . By application of the relevant provisions of paragraph 49 of the Bombay Tyres judgment, the cost of transportation from the factory to the place of removal would not be excluded and would have to be included. The position would remain unchanged in the case of delivery at the factory gate not because of any change in the law but because no cost would be incurred in the transportation. Prior to the amendment of Section 4 in 1996, there were only two places of removal i.e. the factory or other such place of production or manufacture or warehouse or any every place where the goods were permitted to be deposited without payment of duty. By the amendment made in 1996, a place such as depots from which the manufacturer delivered the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds not at the factory gate but elsewhere. Therefore, in order to arrive at real wholesale cash price at the factory gate , that element of averaged freight has to be deducted. The judgment therefore merely clarifies the position where the freight is average, the element of average freight would have to be deducted at the factory gate to arrive at the real assessable value. The judgment cannot be interpreted to mean that it took different stands with regard to unaverage freight and with regard to average freight. The provisions of Section 4 would apply with equal force to average freight and freight that is not so averaged. After the amendment, therefore, the assessee may be entitled to ask for inclusion the element of averaged freight from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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