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TMI Blog2003 (8) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... e Respondent. [Order per : V.K. Agrawal, Member (T)]. The common issue involved in these three appeals, filed by M/s. Bharat Heavy Electricals Ltd., is whether duty of Excise is payable on the goods cleared by them as a free warranty replacement. 2. Shri Z.U. Alvi, learned Advocate, fairly mentioned that the issue on merit has been decided by the Supreme Court in their own case - B.H.E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wards free warranty replacement from the contractual price since duty on replacement was held to be payable separately at the time of their clearance. He finally submitted that penalty under Rule 173Q of Central Excise Rules, 1944 is also not imposable as the issue involved is an issue of legal interpretation. 3. Countering the arguments Shri Vikas Kumar, learned SDR, submitted that in spite of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery. The Supreme Court also did not agree with the contention of the Appellants that when a part is replaced under warranty the value of that part is zero and no Excise duty is payable on that part. It has been held by the Supreme Court that in order to promote sales manufacturers and dealers very often after incentives e.g. supply of free T.V. or some other equipment or goods. One of the incent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty under Section 11AC can be imposed only where duty of Excise has not been levied or paid, etc. by reasons of fraud, collusion, or any wilful misstatement or suppression of facts or contravention of any of the provisions of the Act or Central Excise Rules with intent to evade payment of duty. It is not disputed by the Revenue that the Commissioner of Central Excise in his order has confirmed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty and without following the procedure prescribed under the Rules in spite of the fact that two decisions of the Commissioner have gone against them. It has been held by the Supreme Court in the case of Zunjarrao Bhikaji Nagarkar v. U.O.I. - 1999 (112) E.L.T. 772 (S.C.) that under Rule 173Q both things are necessary, (i) goods are liable to confiscation, and (ii) person concerned is liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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