Prices charged by job-worker cannot be regarded as understated where principal manufacturer has extended loan to job-worker for investment in machinery

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..... Prices charged by job-worker cannot be regarded as understated where principal manufacturer has extended loan to job-worker for investment in machinery - By: - Bimal jain - Central Excise - Dated:- 14-11-2015 - - Commissioner of Central Excise, Bangalore Vs. Campco [ 2015 (9) TMI 1085 - SUPREME COURT ] Campco ( the Respondent ) had been doing the job work on behalf of Nestle India Lim .....

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..... ited ( Nestle ) and was engaged in manufacturing of chocolates exclusively for Nestle. In addition, the Respondent was manufacturing the said chocolates for themselves as well, which were independently marketed. Nestle advanced a sum of ₹ 4.5 Crores to the Respondent for purchase of machinery. The Department contended that the Respondent was not charging the normal market price from Nes .....

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..... tle for supply of chocolates because the price which was being charged was influenced by the amount advanced to the Respondent by Nestle. The Hon ble Supreme Court held that the advance of ₹ 4.5 Crores was given by Nestle to the Respondent for purchase of machinery and it was only a loan transaction independent of the trading relationship between the parties and thus, had not impacted the .....

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..... price charged from Nestle. Further, there was no mutuality of interest and the relationship was on principal-to-principal basis between the parties. Thus, the price at which the goods were sold by the Respondent to Nestle would be the value at which the Excise duty was payable. - - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindi .....

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..... a - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax .....

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