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TMI Blog2015 (9) TMI 981X X X X Extracts X X X X X X X X Extracts X X X X ..... ty. The period of dispute in this case is from October, 2011 to December, 2012. During the period of dispute, the assessee were having sales through dealer/C&F Agents. The assessee were giving cash discounts and turnover discounts/turnover discount to their dealers. The quantity discounts/turnover discounts were being given to the dealers buying certain minimum quantity of tyres in a month. During the above period of dispute, the assessee requested the Department for provisional assessment under Rule 7 of the Central Excise Rules, 2002, but the same was refused. In view of this, the assessee, during the period of dispute, paid duty on the value without deducting the discounts, as the same depending upon the volume of purchase made by the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the Commissioner (Appeals) s order disallowing the deduction of the quantity discount/turnover discount. 2. Heard both the sides. 3. Shri Tarun Gulati, Advocate, ld. Counsel for the appellant, pleaded that as regards quantity discount/turnover discount, as is clear from the Clause in the assessee s agreement with their dealers, the same is linked to the dealers buying certain minimum quantity during the month, that there is no linkage between the quantity discount available to a dealer and that dealer having to provide certain facilities and infrastructure at his showroom, that there is nothing in the assessee s agreement with their dealers/C&F Agents from which it can be inferred that the quantity discount was subject to the conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty is not required in trade discounts and that special trade discount provided to bulk buyers is admissible for deduction, that in view of this, disallowing the deduction of quantity/turnover discounts is not correct, that though the assessee offers the quantity/turnover discounts at different rates to different types of dealers depending upon their infrastructure facilities which in terms of the Apex Court s judgment in the case of Metal Box India Ltd.(supra), the assesse are free to do so, that the same view has been taken by the Tribunal in the case of .Hindustan Lever Ltd. reported in 2005 (189 )ELT 434 (Tribunal-Delhi), wherein the Tribunal held that norms and criteria of discount is entirely in the domain of sellers and buyers and tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2012 (276) ELT 304 (Kar.), that the ratio of the judgements of the Hon ble Rajasthan High Court and Karnataka High Court is squarely applicable to the facts of this case and in view of this, the order of the Commissioner (Appeals) that there is no unjust enrichment is correct. 4. Shri R.K. Gupta, ld. Departmental Representative while assailing the impugned order of the Commissioner (Appeals) on the point of unjust enrichment by reiterating the grounds of appeal in the Revenue s appeal, defended the Commissioner (Appeals) s order disallowing the deduction of quantity/turnover discount by reiterating the Commissioner (Appeals) s findings in the impugned order and pleaded that the quantity/turnover discount being given by the assessee is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Apex Court in the case of Bombay Tyre International reported in 1984 (17) ELT 329 (SC) and the judgement of the Apex Court in the case of Government of India Vs. Madras Rubber Factory reported in 1995 (77)ELT 433 (SC) for permitting trade discounts what is relevant is that the nature of the discount i.e. the discount policy and its basis should be known prior to the clearance and it is not material that the discount should have been passed on at the time of clearance. In fact, in terms of para-9 of the Board s Circular No.354/81/2000-TRU dated 30.06.2000, discount of any type or description given on any normal price payable for any transaction will not form part of the transaction value for the goods e.g. quantity discount for goods pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee to their dealers are a compensation for the expenses incurred by the dealers for maintaining the showrooms in certain manner and providing certain minimum facilities in the showrooms. A manufacturer can always insist on maintenance of certain minimum facilities in the showrooms by its dealers which would result in more sales and which in turn will benefit both, the assessee as well as the dealer. Therefore, we do not accept the Revenue s contention that the quantity/turnover discount being offered is compensation by the assesee to the dealers for incurring the expenses on maintaining certain infrastructure and facilities at their showrooms. In view of this, the impugned order disallowing the deduction of the quantity/turnover disc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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