Case Law Details
Panama Petrochem Ltd. Vs Commissioner of C.E. & S.T.-Daman (CESTAT Ahmedabad)
The case of Panama Petrochem Ltd. vs. Commissioner of C.E. & S.T.-Daman, adjudicated by CESTAT Ahmedabad, delves into the contentious issue of whether freight and insurance charges should be included in the assessable value of goods for charging excise duty.
The crux of the matter lies in the inclusion of freight and insurance charges in the transaction value of goods. The appellant contended that these charges, collected separately and over and above the price of goods, should not be part of the assessable value. The appellant argued that as per contractual agreements with buyers like IOCL and HPCL, the transportation costs were distinct and separate from the price of the goods.
The appellant’s counsel cited various precedents and legal provisions to bolster their argument. They emphasized that the invoices clearly delineated the basic price of goods and the transportation costs, fulfilling the criterion laid down by Rule 5 of the Valuation Rules. Moreover, the appellant asserted that there was no evidence to suggest that these charges were aimed at depressing the assessable value.
On the other hand, the revenue, represented by the Superintendent (AR), reiterated the findings of the impugned order, contending that the freight and insurance charges should indeed be included in the assessable value.
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