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TMI Blog2001 (1) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... 'discount' is admittedly on account of damages suffered by goods after removal from the factory. Thus a compensation in the nature of warranty allowance on a defective tyre . The finding of the Tribunal on this issue therefore cannot be sustained. On the question of bank charges, however we are of the view that bank charges being in the nature of post clearing expenses are deductible while calculating the assessable value of the goods. In Assistant Collector of Central Excise and Others v. Madras Rubber Factory (supra) and Shriram Fertilizers Chemicals v. Union of India [ 1997 (3) TMI 112 - SUPREME COURT OF INDIA ] and Government of India and Others v. Madras Rubber Factory Ltd. and Others [ 1995 (5) TMI 28 - SUPREME COURT OF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from M/s. Hindustan Lever Ltd. (HLL). After the goods are packed, they are cleared from the factory by HLL and sold through it's clearing and forwarding agents from their depots all over the country to wholesale buyers who are known as Redistribution Stockists. The Department calculated the excise duty payable on the detergent powder on the price charged by HLL from the redistribution stockists. Civil Appeal No. 3160 of 2000 : 3.M/s. IPF Vikram India Ltd., the respondent in this appeal produces detergent under agreement with M/s. Indexport Ltd. (IEL) and Stepan Chemicals Ltd. (SCL) under the brand name 'Wheel'. The respondent despatches the goods manufactured by it to the destinations specified by IEL/SCL. According to this respondent, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds could not be known at the time of their removal from the factory and as such was not admissible as a deduction on the wholesale price. It was contended that what the respondents claimed as discount was in fact a refund to the buyers for receiving goods damaged in transit. As far as Bank collection charges are concerned, according to the appellant, these were neither cash discounts nor any other discount within the meaning of the word in Section 4(4)(d)(ii) of the Act. 6.It was submitted by the respondents that deduction on account of damages represented discounts allowed to the whole-sellers for damages suffered by the goods cleared from the factory during transit there being no sale at the factory and were incurred in lieu of transit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods, - (ii) does not include the amount of the duty of excise, sales tax and other taxes, if any, payable on such goods and, subject to such rules as may be made, the trade discount (such discount not being refundable on any account whatsoever), allowed in accordance with the normal practice of the wholesale trade at the time of removal in respect of such goods sold or contracted for sale." 8.The "normal price" in this case, would have to be determined with reference to the time and place of removal of the goods from the respondents' respective factories. Since the price in both cases was fixed with reference to the sale at the depots to the redistribution stockists, clearly in terms of sub-section (2) of Section 4, the responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portation but under sub-section 4(d)(ii) of Section 4 as a trade discount. We are unable to accept the submission. 10.The object of "damage discount" is to compensate the buyer for the damaged goods and logically, compensation for damaged goods could not feature as a relevant consideration for determining the price of the goods as manufactured at the time of clearance of the goods. The 'discount' is admittedly on account of damages suffered by goods after removal from the factory. A similar deduction claimed as a "warranty discount" was negatived in the two Madras Rubber Factory judgments referred to earlier. Bhagwati C.J's dictum in the first of such judgments which was quoted with approval in the second was : "what is really relevant is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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