COMMISSIONER OF CENTRAL EXCISE, NAGPUR-I versus M/S. INDORAMA SYNTHETICS (I) LTD.

COMMISSIONER OF CENTRAL EXCISE, NAGPUR-I versus M/S. INDORAMA SYNTHETICS (I) LTD.

Additional monetary consideration, in the form of advance import licence surrendered by the buyer allowing the seller to effect duty free import of raw materials, constitutes consideration whose monetary value must be included in the transaction value under Section 4 of the Central Excise Act, 1944 and Rule 6 of the relevant Rules, as it is a benefit flowing indirectly from the buyer to the assessee.

Parties
Appellant: Commissioner of Central Excise, Nagpur-I; Respondent: M/s. Indorama Synthetics (I) Ltd.
Jurisdiction
India
Judgment Date
25 August 2015
Procedural Posture
Civil Appeal / Appeal From the Customs, Excise and Service Tax Appellate Tribunal, Final Order No. A/1417/wzb/2005/ill in Appeal No. E/1318/04 Mum
Outcome
Appeal allowed; order of the Tribunal set aside; order of the Commissioner restored.
Legal Topics
Central Excise, Valuation of Excisable Goods, Transaction Value, Additional Consideration, Deemed Export, Advance Licence
Taxation Law Central Excise Valuation of Excisable Goods Transaction Value Additional Consideration Deemed Export Advance Licence

Case Brief

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Parties

Commissioner of Central Excise, Nagpur-I

Appellant

M/s. Indorama Synthetics (I) Ltd.

Respondent

Procedural Posture

Civil Appeal / Appeal From the Customs, Excise and Service Tax Appellate Tribunal, Final Order No. A/1417/wzb/2005/ill in Appeal No. E/1318/04 Mum

Legal Issues

  1. 1 Whether additional monetary consideration in the form of advance licence surrendered by buyers should be included in the transaction value under Section 4 of Central Excise Act, 1944 and Rule 6 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000

Ratio Decidendi

Additional monetary consideration, in the form of advance import licence surrendered by the buyer allowing the seller to effect duty free import of raw materials, constitutes consideration whose monetary value must be included in the transaction value under Section 4 of the Central Excise Act, 1944 and Rule 6 of the relevant Rules, as it is a benefit flowing indirectly from the buyer to the assessee.

Court Disposition

Appeal allowed; order of the Tribunal set aside; order of the Commissioner restored.

Orders

  • Appeal allowed.
  • Decision of the Tribunal set aside.