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TMI Blog2017 (7) TMI 406X X X X Extracts X X X X X X X X Extracts X X X X ..... have been unearthed by them other than the said letter of the statement. Such delay cannot sought to be covered up by invoking suppression when there was no suppression, or while invoking misstatement, of which also we do not find any evidence. This being so, the proceedings initiated against the appellant are clearly hit by limitation and the appellant will succeed on this ground alone - the impugned order will have to be set aside on the ground of limitation proceedings being hit by limitation. On merits also, Deduction of software cost has to be on the basis of amount equivalent to market prices of the comparable product, that the cost of operating software was not the cost of CD alone but other costs such as royalty, warranty, after-sales service etc. are to be taken into account, that the intrinsic value of software is to be calculated by taking into account not only the purchase price but other costs, and that department charged that appellant overstated the value of software in undervalue the computer do not stand on firm ground. Reliance was placed in the case of Birla Corporation Ltd. Vs CCE [2005 (7) TMI 104 - SUPREME COURT OF INDIA]. Appeal allowed - decided in favor of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 1845 to ₹ 2655/- in the year 2000, ₹ 2160 to ₹ 3015 in 2001 and ₹ 4353 to ₹ 4399 in the year 2003. There was further expenditure on warranty in the range of 20% to 25% of the sale price. Profit and Loss account was between 5% and 10%. Thus, typically, the total value of operating software at the hands of the appellant was ₹ 4026/-. This amount was more than ₹ 3160/- which was claimed as abatement. (3) For the predominant part of the impugned period, new Section 4 of the Central Excise Act, 1944, substituted w.e.f 1.7.2000, was in force for valuation of excisable goods for the purpose of charge of excise duty. As per the new Section 4, assessable value, with few exceptions, would only be the transaction value, which as defined in the section itself, inter alia, means the price actually paid or payable for the goods, when sold, and includes in addition to the amount charged as price, any amount that the buyer is liable to pay to, or on behalf of the assessee etc., any amount charged for servicing, warranty or any other matter. (4) The above deduction of ₹ 3160/- from the complete transaction price for the computer system sold by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty times that value, namely, between ₹ 3160 and ₹ 9800/- for operating software and ₹ 11,550/- for application software. (b) There is no justification for such enhanced deduction. The contention of appellant that values deducted towards software cost included royalty and warranty costs also cannot be accepted, since the purchase value will always be factor in such costs and there is no practice to recover the cost towards royalty and warranty after purchase of the software. Further, the software had been imported by appellants from sellers, who were resellers from abroad, and not directly from the software manufacturers themselves. Appellant has not evidenced any proof or corroboration to substantiate their claim of having incurred additional cost on software towards royalty and warranty charges. (c) Therefore, the letter of appellant dt. 25.08.2000 is a misstatement and since appellants have not proved their claim to the satisfaction of department, suppression is very much existent in this matter and the adjudicating authority is fully justified to invoke extended period of limitation. (d) The claims made by appellant regarding deductions are based on abstra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCN is seen to be extracted from the statement given on 20.06.2001 by one Shri Ravishankar B.S., Manager (Operations), of the appellant. There is no other evidentiary material that is found in the SCN to support the allegation of the department that deduction towards cost of software over and above the actual cost of the same is to be considered as suppressed value of personal computers. The letter intimating claim of abatement to the extent of cost of software has been alleged in the SCN as showing culpable mental state of the assessee to evade payment of Central Excise duty (para-13 of the SCN). Even so, the period between the appellant's letter dt. 25-08-2000 (referred to in the SCN) or for that matter, the date of recording of statement from Shri Ravishankar namely, on 20-06-2001, and issue of SCN is well beyond normal period of limitation. We are unable to fathom the reasoning for this inexplicable delay on the part of the department to initiate adjudication proceedings, especially when no new material or facts have been unearthed by them other than the said letter of the statement. Such delay cannot sought to be covered up by invoking suppression when there was no suppres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has held that where the department accepts the principle laid down by the Tribunal in one case and let it become final, then the department is not entitled to raise the same point in other cases. The department cannot pick and choose. [See : The decisions of this Court in Union of India & Others v. Kaumudini Narayan Dalal & Another - (2001) 10 SCC 231; Collector of Central Excise, Pune v. Tata Engineering & Locomotives Co. Ltd. - 2003 (158) E.L.T. 130 (S.C.); Birla Corporation Ltd. v. Commissioner of Central Excise -2005 (186) E.L.T. 266 (S.C.); and Jayaswals Neco Ltd. v. Commissioner of Central Excise, Nagpur - 2006 (195) E.L.T. 142 (S.C.). It has been held in all these cases that if no appeal is filed against an earlier order or the earlier appeal involving the identical issue was not pressed by the Revenue, the Revenue is not entitled to press the other appeals involving the same question. In Birla Corporation Ltd. (supra), this Court observed as follows : "In the instant case the same question arises for consideration and the facts are almost identical. We cannot permit the Revenue to take a different stand in this case. The earlier appeal involving identical issue was not pre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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