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TMI Blog2005 (4) TMI 227X X X X Extracts X X X X X X X X Extracts X X X X ..... quantities on free of cost to their distributors. In other words, the scheme amounts to a quantity discount scheme. Initially, the scheme was effective from 10-3-97 to 26-4-97. However from time to time, the scheme was extended for further periods. The last Para of the said Circular reads as follows :- "Please note no credit notes will be given on schemes. In case you are holding stock, you are advised to give scheme on the stock you are holding and place the order for similar amount with the company where we shall give you scheme. The stock which you have given on scheme should be replenished with the stocks which you will receive on scheme from the company." As can be seen, initially when the scheme was started, the distributors were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, the same does not change the nature of transaction. (3) All the relevant materials placed on record including the circulars and also the quantity given as quantity discount being specifically indicated in the invoices itself have been totally ignored and brushed aside. (4) No evidence has been adduced to establish that what was given as free supply is only for replenishment of the stock as assumed while passing the order particularly for the period from 1-4-98 onwards and up to March 2000. (5) The said discounts claimed as quantity discount was known much prior to the removal of the goods and was even allowed in each and every invoice under which goods were cleared as per the scheme during the said period. (6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is given by the appellants to the distributors is only quantity discount. Initially, when the scheme was started the distributors were advised to go with the scheme using the stock which they held. This stock was to be replenished later by the appellants. We do not find anything sinister in this arrangement. There was no allegation by the Revenue that clearance in excess of the allowed quantity in terms of the scheme have been made without payment of duty. This is very clear from the letter dated 7-2-2000 by the Additional Commissioner addressed to the SDR, Bangalore. There was absolutely no reason to reject the quantity discount offered by the appellants in terms of various circulars. The question of replenishment arose only in the initial ..... X X X X Extracts X X X X X X X X Extracts X X X X
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