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TMI Blog2005 (8) TMI 112X X X X Extracts X X X X X X X X Extracts X X X X ..... As the additional consideration was to flow to them, they have sold at the rates mentioned in the letter of 2nd March 1993. The "additional consideration" is the difference in prices between these two. The Commissioner had thus correctly worked out this difference. It may also be mentioned that the Respondents had also taken up a contention of limitation. The Tribunal has not considered this aspect in view of the fact that it has allowed the Appeal on merits. We were requested that the matter be sent back to the Tribunal so that the Tribunal can consider the question of limitation. We are agreeable to that. We, therefore, remit the matter back to the Tribunal. The Tribunal is, therefore, directed to only consider whether or not the exten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artment claimed that the benefit derived by the Respondents under the Advance Intermediate Licence, issued to them as a result of surrender of licence by M/s. Visakhapatnam Steel Plant, was "additional consideration" towards the value of the goods and that this "additional consideration" formed part of the price for purposes of excise duty. 3.The Tribunal has allowed the Appeal of the Respondents by inter alia holding as follows :- "...... In the instant case the appellant have availed the benefit from the customs duty under the advanced intermediate licences issued to them by the statutory authorities in accordance with the relevant provisions of the import policy. Such benefits are under the duty exemption scheme and have to be treat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price paid by the buyer plus the money value of additional consideration flowing directly or indirectly from the buyer to the seller in connection with the sale of goods. Such a provision has now been incorporated in Section 4 itself. 7.Thus, if any additional consideration is received from the buyer in connection with the sale of goods, then that additional consideration forms part of the price for purposes of excise duty. Undoubtedly, the Government had a "Duty Exemption Scheme". But the Respondents did not have any Advance Intermediate Licences of their own under the Scheme. If they had had their own Licences, the reasoning of the Tribunal may have been correct. It is only because of the Contract of Sale that M/s. Visakhapatnam Steel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... @ Rs. 1,264/- per pc. Jointing and Sealing Compound Free of cost (for proportionate quantity against order for item Nos. 1, 2 and 3 placed on us)" 9. Ultimately it was agreed that M/s. Visakhapatnam will surrender its Advance Licences and in lieu thereof the Respondents get the Advance Intermediate Licences. Thus, without the Advance Licences of M/s. Visakhapatnam Steel Plant, being made available to the Respondents, the prices would have been as were quoted earlier. It is only because of the Advance Licences being surrendered by M/s. Visakhapatnam Steel Plant and in lieu thereof Advance Intermediate Licences being made available to the Respondents that the Respondents could offer lower prices. The surrendering of Licenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts flowing therefrom, then such benefit cannot be said to be an "additional consideration". 10. The question then arises as to how the "additional consideration" is to be computed. In this case the benefit accrued to the Respondents is clearly ascertainable by virtue of the two letters of the Respondents. Had this additional benefit not flown to the Respondents, they would have sold the items as per their offer dated 9th September 1992. As the additional consideration was to flow to them, they have sold at the rates mentioned in the letter of 2nd March 1993. The "additional consideration" is the difference in prices between these two. The Commissioner had thus correctly worked out this difference. 11. It may also be mentioned that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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