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TMI Blog2019 (5) TMI 1226X X X X Extracts X X X X X X X X Extracts X X X X ..... e - 2010 (hereinafter referred to as the 'Scheme') which were adjusted towards payment of VAT and CST in their returns, but the Central Excise Duty was not paid on the amount received as additional consideration of sales tax collected from the buyers and retained by them to the extent of sales tax liability not actually paid to the state exchequer. The Adjudicating Authorities confirmed the demand of Central Excise duty and ordered for recovery of the same with interest under section 11A and section 11AA/11AB of the Central Excise Act, 1944 (hereinafter referred to as the 'Act') and imposed penalties. Feeling aggrieved, the Appellants preferred Appeals before the Commissioner (Appeals) under Section 35 of the Act. It was sought to be contended that the disbursement of the sales tax amount as 'Subsidy' under the Scheme would not be included in the 'Transaction Value'. The Appellants also contended that the Scheme is entirely different from the Scheme under consideration before the Supreme Court in Commissioner of Central Excise vs Super Synotex (India) Limited, reported in 2014 (301) ELT 273 (SC), and, therefore, the said decision of the Supreme Court would be of no help to the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ST, Jabalpur (Appeal No. E/51979 of 2017 decided on 5 April 2018). It is the submission that the Division Bench of the Tribunal in Maihar Cement examined an identical issue after placing reliance upon an earlier Division Bench decision of the Tribunal in Shree Cement Ltd. vs. CCE, Alwar (decided on 18 October 2018). 4. The learned Authorised Representative of the Department has, however, supported the impugned order and contended that it does not call for any interference. 5. It is in the year 2010 that the Government of India notified a Scheme called "Rajasthan Investment Promotion Scheme - 2010". The Scheme seeks to promote investment in the State of Rajasthan and to further generate employment opportunities through such investment. It came into effect from 25 August, 2010 and remained in force upto 31 March, 2018. The Scheme was made applicable to (i) new enterprise; (ii) existing enterprise making investment for modernization/ expansion/diversification; (iii) sick industrial enterprise for its revival; and (iv) enterprise which has set up Project for Common Social Good. 6. Clause 4 of the Scheme relates to 'Subsidy' and is as follows : "4. SUBSIDY A. Subsidy shall consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Clause 5 deals with 'Exemptions' and provides as follows : "A. The Enterprise to which an Entitlement Certificate as prescribed under the Scheme has been issued shall be eligible to claim the exemption(s) from the taxes/duties/charges, to the extent and for the period as mentioned in Table-4 given below xxxxxxxxx xxxxxxxxx xxxxxxxx B. In case of Enterprises going for Modernization/ Expansion/ Diversification, the exemption from payment of tax (es) shall be allowed only to the extent to which additional tax liabilities accrue due to utilization of additional capacity created after Modernization/Expansion/Diversification." 8. The procedure for claim has been set out in Clause 6 of the Scheme, while 'Procedure for Disbursement of Subsidy' has been provided in Clause 7. Clause 7 of the Scheme is reproduced below : "PROCEDURE FOR DISBURSEMENT OF SUBSIDY: A. For disbursement of subsidy the enterprise to which an Entitlement Certificate as prescribed under the Scheme has been issued shall apply quarterly in Form - IX, appended to the Scheme, to Assistant Commissioner/ Commercial Taxes Officer of the area where the enterprise is registered with the Commercial Taxes Departm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts are covered by the Investment Promotion Schemes of the Rajasthan Government. In terms of the various schemes of the Rajasthan Government, the appellants are required to discharge their VAT liability by making payment of the same. Out of such VAT credited to the Government, a certain portion is disbursed back to them in the form of subsidies. Such disbursement happens in the form of VAT 37 B, challan which can be utilized in subsequent periods to discharge VAT liability. The crux of the dispute in the present case is whether such subsidy amounts are required to be included in the assessable value of the goods manufactured by the appellants, in terms of Section 4 of the Central Excise Act. As per the concept of transaction value outlined in Section 4, with effect from 01/07/2000, any sales tax/VAT actually paid can be deducted from the transaction value for payment of excise duty. Revenue has taken the view that payment of VAT using 37B Challans cannot be considered as actual payment of VAT. 8. Both sides have referred to the decision of the Apex Court in the case of Super Synotex India Ltd. In the above decision the Apex Court has categorically held that after 01/07/2000, unle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... un Corporation Ltd. case we conclude that there is no justification for inclusion in the assessable value, the VAT amounts paid by the assessee using VAT 37B Challans". 11. The Tribunal in M/s Maihar Cement followed the aforesaid decision rendered in M/s Shree Cement Ltd. as basically both the Scheme of the Rajasthan Government and Madhya Pradesh Government were identical. 12. In the present case, as noticed above, the Appellants in terms of the Scheme had deposited the entire amount of VAT collected. It is this amount that is used as a measure for granting financial assistance to be subsequently provided. 13. The judgment of the Tribunal in M/s Maihar Cement and M/s Shree Cement Ltd. would, therefore, apply and the financial assistance granted to the Appellants cannot be included in the Transaction value for payment of excise duty. 14. The learned Authorised Representative has, however, placed reliance on the decision of the Tribunal in Jayaswal Neco Industries Ltd. vs Commissioner of Central Excise & Service Tax, Raipur, reported in 2016 (344) ELT 578 (Tri.-Del.) and Honda Motorcycles & Scooters India P. Ltd. vs Commissioner of Central Excise, Delhi-III, reported in 2017 (357 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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