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TMI Blog2023 (5) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... puted in the show cause notice that the job charges recovered by the appellant were suppressed in any manner for making the demand. In the case of BARODA ELECTRIC METERS LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [ 1997 (7) TMI 126 - SC ORDER ], Hon ble Supreme Court has held that It was clearly held in INDIAN OXYGEN LTD. VERSUS COLLECTOR OF CE. [ 1988 (7) TMI 58 - SUPREME COURT ] , that the duty of excise is a tax on the manufacturer and not a tax on the profits made by a dealer on transportation. The decisions relied upon by the learned AR are distinguishable as in the case of PHARMASIA LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, HYDERABAD [ 2004 (7) TMI 170 - CESTAT, BANGALORE ], the issue was in regard to addition of amounts collected under the category of other work overheads , the fact which was admitted by the assessee in their statements. Hon ble Supreme Court order is only limited to the issue of suppression etc. for invoking period of limitation. The appeal is allowed. - Excise Appeal No. 86475 of 2013 - FINAL ORDER NO. A/85577/2023 - Dated:- 27-3-2023 - HON BLE MR. SANJIV SRIVASTAVA , MEMBER ( TECHNICAL ) And HON BLE DR. SUVENDU KUMAR PATI , MEM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cated as per the order-in-original referred in para 1 above, which has been upheld by the impugned order. Aggrieved by the impugned order, appellant has filed this appeal. 3.1 We have heard Ms. Padmavati Patil, Advocate for the appellant and Shri P.K. Acharya, Superintendent, Authorised Representative for the Revenue. 3.2 Arguing for the appellant, learned counsel submits that:- Appellant is processing fabrics on job work basis for merchant manufacturer to supply grey fabrics. They were also undertaking insurance on behalf of the merchant manufacturers. Appellant was paying central excise duty on assessable value comprising of cost of grey fabrics, job charges, insurance charges on equalized basis. Appellant was including insurance charges o the equalized basis and what has not been included is a profit and nonmanufacturing activity. It has been held in the following decisions that such profit on non-manufacturing activity could not have been included in the assessable value:- Baroda Electric Meters Ltd. [1997 (94) ELT 13 (SC)] U.P. Twiga Fiberglass Ltd. [2015 (316) ELT 304 (Tri.- Del.)] Marpol Pvt. Ltd. [2017-TIOL-567-CESTAT-MUM] Neha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a consideration received in the course of job work activity. Even the Rule 6 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 states that the value of any additional consideration flowing directly or indirectly to the assessee would be includable in the transaction value. 06. The appellant has contended that the assessable value/transaction value on which duty is paid by them is inclusive of insurance on equalized basis and hence recovering of differential duty in the impugned order is incorrect and uncalled for. The statements and invoices (Exhibit D) produced along with the appeal memorandum indicates that the appellant was including insurance charges @Rs. 0.03 per meter in the valuation of processed fabric for discharge of Central Excise duty. Although the actual amount recovered by the appellant from the merchant manufacturer towards insurance is indicated in the impugned order, which have not been disputed by the appellant, the appeal memorandum do not throw any light on the amount which would have been actually receivable from the merchant manufacturers towards insurance if calculated @ Rs. 0.03 per meter, without which it is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chant manufacturers, during the period from 01.04.2003 to 09.07.2004 and hence no duty is recoverable from them. The contention of the appellant on this count is very surprising and lacks depth in as much as, having voluntarily decided to discharge the duty liability on fabrics processed by them on job work basis, it is not open for them to contend at a later stage that the duty liability rest on the merchant manufacturer and not on them, more so when they themselves were undertaking job work manufacturing without payment of duty under Rule 4 (5) of the Cenvat Credit Rules, 2004 read with Notification No. 214/86-CE dated 25.03.1986 for their other customers. 11. The appellant has further contented that the assessable/transaction value has to be treated as cum-duty price and have place reliance on Hon'ble Supreme Court judgement in the case of M/s Maruti Udyog Ltd - 2002 (141) ELT 3 (SC), CBEC Circular No. 803/26/2004-CX dated 27.12.2004 and Explanation inserted to Section 4 (1) of CEA w.e.f. 14.05.2003. This contention of the appellant would also not find appreciation for the reason that the assessable value or transaction value in case of goods processed on job work basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tained. 4.4 Following the above decision of Hon ble Apex Court, Tribunal has in the case of U.P. Twiga Fiberglass Ltd. [2015 (316) ELT 304 (Tri.-Del.)] held as follows:- The precise question in this appeal is whether the amount collected over and above the insurance premium paid to the insurance company is taxable in the hands of appellants. The excess is not includible under Section 4 of Central Excise Act, 1944 to determine the assessable value. The excess collection being profit in the hand of the appellant is immaterial to Section 4 of central excise law and that may be material to Income Tax Act, 1962. Therefore, following the ratio laid down by the Apex Court in the case of Baroda Electric Meters Ltd. v. Collector, Central Excise - 1997 (94) E.L.T. 13 (S.C.) such excess is not liable to duty. Once there shall not be levy as above, levy of duty has unjustly enriched the State. That is the ratio laid down by the Apex court in the case of Union of India v. ITC - 1993 (67) E.L.T. 3 (S.C.). Accordingly, State is not empowered to keep that money without refunding to appellant. Such collection when refunded is not barred by limitation, following the ratio laid down in ITC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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