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TMI Blog2007 (5) TMI 448X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel for the appellant is that demand of about Rs. 60 lakhs out of the total amount of Rs. 1.74 crores is beyond the extended period permitted under the proviso to Section 11A also. But it is being shown by ld. DR that assessments were finalized in 1984, and therefore, the entire demand is within time limit. 3. Ld. Counsel would point out that even otherwise, the entire demand is barred by limitation as clearances of computers were against excise approved prices and Central Excise Officers had also carried out price verification in 1984. The contention is that through this audit the authorities were aware of the method of sale. 4. The demand has been made upon a finding that the appellant was artificially splitting the sale price o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 dated 2-8-84 was written to the customer showing that Rs. 56,728.80 were being charged towards TSC for consultation charges for suggesting the right machine and expert advice on software import technology. The difference between the amount of TSC shown in the invoice and in the letter was unexplained but it is apparent that amount of TSC was arbitrary and was not based on any justification. It may be seen from the marketing pattern of HCL that they used to visit their customers for giving them suggestion for right selection of machine. In some cases, negotiation was materialized and in other cases it was not but they did not charge any amount for this purpose to the customers from whom negotiation was not materialized. It is not clear a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computer. (v) Enquiries with M/s Data Bank who happened to be a buyer of HCL computer revealed that HCL personnel explained the said buyer for charging TSC as : (a) Installation of computer, (b) Interfacing of various units of computer bought out from different vendors, and (c) Periodical improvement of hardware deficiencies encountered in the performance the computer to be supplied free of cost after installation. The above cited some examples are enough to conclude safely that TSC was not exactly relating to some services to be rendered by HCL. It is an arbitrarily action of HCL to split up cost of the computer. Even in cases where customers were apprised about charging TSC and they denied to pay the same, HCL forced them to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat training of officials of buyer was offered free of cost as per sale agreement as discussed in para 2.1. And as far as warranty expenditure is concerned, it is settled law that the same is always part of the assessable value as it enrich the marketability of the product. Only the installation charges are excludible amount from the cost of TSC for working out value of the computer. The cost of installation charges was given by the party themselves as 10% of TSC (as discussed in para 2.1), which appears genuine and correct. I am therefore inclined to allow 10% of TSC as installation charges which obviously being post-manufacturing expenses would not be includible in the assessable value of computer. 6. We are prima facie of the view tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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