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TMI BlogImplementation of decision of Hon’ble Supreme Court in case of M/s Fiat India ltd – reg .X X X X Extracts X X X X X X X X Extracts X X X X ..... m trade and field formations seeking clarification on implementation of the judgment . The facts in the case of M/s Fiat India Ltd were that the cars were sold at a price substantially lower than the cost of the manufacture and such sales continued for a period of five years . The company admitted that the purpose of such pattern of sale was to achieve market penetration . The Hon ble Supreme Court held that in such circumstances revenue could reject the transaction value declared under section 4 and invoke the provisions of the Central Excise Valuation ( Determination of Price of Excisable Goods ) Rules , 2000 to assess Central Excise duty . Following clarifications are issued in this regard - Transaction Value below manufacturing co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , mere sale of goods below the manufacturing cost and profit cannot be taken as the sole basis for rejecting the transaction value . Verification of payment of duty 3. The second issue is regarding the procedure to be adopted by the field officers to identify cases where the ratio of the judgment would apply. It may be noted that , under the self-assessment procedure , there is a legal obligation on the assessee to correctly assess and pay the duty in terms of the Central Excise Act , 1944 read with the Valuation Rules , 2000 . Verification of this aspect may be conducted by the Central Excise officer during the audit of units . Aspects such as the percentage of loss at which sale has taken place , the period for which such loss mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Hon ble Supreme Court as constituting extra-commercial consideration , even when there was no additional consideration of money value flowing directly or indirectly from the buyer to the seller . For the period prior to the date of the judgment , in cases where a show cause notice has been issued on the grounds of the FIAT judgment alone , there may not be a case for invoking the extended period of limitation . In such cases , only the normal period of limitation will apply . 4.1 For the period after the date of the judgment , i.e from 29- 8-2012 onwards , if there is a sale in the circumstances similar to the case of M/s FIAT and yet transaction value of goods is declared as the correct assessable value , then such declaration wou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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