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TMI Blog2014 (8) TMI 184X X X X Extracts X X X X X X X X Extracts X X X X ..... OS Dt: 29.03.2006 Extract vide Annex-IV} to supply various types of Supersonic Cruise Missiles, Ground Support Equipment, User Documentation, Spares for Ground Supporting Equipment, Training Aids besides providing Training, Infrastructure Development and Project Management. The contract specifies the quantities to be supplied in each category and the price payable per item in each category. The contract also specifies the amounts payable for Infrastructure Development and Project Management. 2.2. Appellant did not pay central excise duty on documentation charges, training, training aids, non recurring expenditure and project management. Appellant also entered into a contract with Indian Navy {Contract No. 100/DSR/C/05-06/Brahmos systems Dt: 14.11.2005-Extract vide Annex-V}. As per this contract the company has been supplying different types of Supersonic Cruise Missiles, Platform Systems like Fire Control System, Universal Vertical Launching Module, B&D Spares to Indian Navy. Appellant also agreed to undertake vide the said contract, Project Management for 2 ships. In respect of supplies made to Indian Navy (other than Project Management which is nothing but co-ordination an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sp; (i) value of materials, components, parts and similar items relatable to such goods; (ii) value of tools, dies, moulds, drawings, blue prints, technical maps and charts and similar items used in the production of such goods; (iii) value of material consumed, including packaging materials, in the production of such goods. (iv) value or engineering, development, art work, design work and plans and sketches undertaken elsewhere than in the factory of production and necessary for the production of such goods. Explanation 2 - Where an assessee receives any advance payment from the buyer against delivery of any excisable goods, no notional interest on such advance shall be added to the value unless the Central Excise Officer has evidence to the effect that the advance received has influenced the fixation of the price of the goods by way of charging a lesser price from or by offering a special discount to the buyer who has made the advance deposit. Illustration 1.- X, an assessee, sells his goods to Y against full advance payment at Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to absurd result. A person who is selling an air-conditioner to a buyer which costs Rs. 12000 and if he shows Rs. 2000 as the cost of air conditioner and Rs. 10000 towards user manual, by following the logic of the learned counsel, no question can be asked since it is not an additional consideration flowing from the seller to the buyer. Moreover, if assessee's claim in this case is accepted, user manual will have to be classified under 4901 and charged to 'nil' rate of duty. Therefore we find that the claim of the learned counsel that Rule 6 is not at all applicable to their case cannot be accepted. 6.1. After hearing both the sides, we find that training or training aids cannot be considered as an activity undertaken in relation to sale of goods being valued. This is definitely a post sale activity. Further there is no clear finding as regards the nature of training, place of training, the kind of training etc. According to the counsel, training aids were bought out items. There is no contra finding to this submission. Therefore we have to take a view that this is a post sale activity and unless the missile is ready, produced and ready to fire, there cannot be any training. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is whether the stand taken by the department that missiles and platforms cannot be considered as stores or used for construction of the warship is correct. 6.7. The learned counsel relied upon the clarification issued by the Board in Sl. No. 89/1988-CX.X dated 30.12.1988 wherein it was observed as follows: 2. The matter has been examined by the Board. Previous Instructions of the Board on this issue, namely, F. No. 19/15/65-CX. 4 dated 4.6.1966, F.No. 19/15/65-CX.4. dated 29.6.1966, F.No. 19/15/65-CX.4 dated 23.8.1986 and No. 71/43/71-CX.2 dated 12.5.1977 indicate that initially a distinction was made between the stores meant for use of a ship of the Indian Navy and the stores supplied for use of the crew of the ship. These items were collectively referred to as 'ship stores'. This distinction was subsequently done away with and, thereafter, the facility continued to be extended by use of the expression 'ship stores for consumption on board a vessel'. Thus it is clear that it has all along been the intention of the Government to grant exemption from central excise duty not only to those excisable goods whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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