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TMI Blog2012 (4) TMI 555X X X X Extracts X X X X X X X X Extracts X X X X ..... e of removal to the place of delivery, it cannot be said that the aforesaid profit has any co-relation with the goods cleared to factory gate as such he cannot be asked to pay excise duty on the freight. Similar issue decided in the case of Baroda Electric Meters Ltd. v. C.C.E. [1997 (7) TMI 126 - SUPREME COURT OF INDIA] where it was held that the “equalized freight charged from everyone freight actually paid less than the amount collected by way of equalized freight, differential amount not includible in the assessable value since the duty of excise is on manufacture and not on profit made by a dealer on transportation”. Appeal allowed - decided in favor of appellant. - E/980/2005 - Final Order No. A/444/2012-EX(BR)(PB) - Dated:- 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actual transportation charges incurred and confirmed the duty demand to the extent of ₹ 6,32,023/- in respect of the period of all the four show cause notices. 3. Feeling aggrieved by the order-in-original, the appellant preferred an appeal but the appellate authority vide impugned orders dismissed the appeal and upheld the view of the adjudicating authority. 4. Ld. Counsel for the appellants submits that it is not disputed that the appellants had sold the goods in question at the factory gate. He was asked by the customers to transport the goods purchased by them to their premises and if he has made profit of transportation charges he cannot be asked to pay the excise duty on the aforesaid profit. Ld. Counsel submits that since ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irmed the demand. 6. In order to appreciate the contention of rival parties, it is necessary to have a look at Section 4(1)(a) of the Central Excise Act, 1944 as also Rule 5 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 which are reproduced thus :- Section 4(1)(a) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to their value, then, on each removal of the goods, such value shall - (a) case where the goods are sold by the assessee, for delivery at the time and place of the removal, the assessee and the buyer of the goods are not related and the price is the sole consideration for the sale, be the transaction value; RULE 5. Where any excisable good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itself is the place of removal by the customer. As such, for the purpose of the excise duty the transaction value is the price of the goods mentioned in the invoice excluding the transport charges which admittedly were separately mentioned. This conclusion of ours does not come with clash with Rule 5 of the Valuation Rules for the reason that Rule 5 deals with those cases in which the invoice give the integrated value of the cost of goods and the transportation charges from the place of removal to the place of delivery. Thus, in our considered view the transaction value of goods supplied in this case is to be calculated on the basis of Section 4(1)(a) i.e. the sale price of goods charged at the factory gate. Admittedly, on that price the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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