Case Law Details
Techno Packers Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai held that the demand of duty alleging that cost of free supply material has to be included in the assessable value is not sustainable and liable to be set aside.
Facts- The appellants are engaged in the manufacture of wooden crates falling under Chapter 44151000 of CETA, 1985. Based on the intelligence that the appellant was receiving the consumables free of cost and has not included the value of such free materials in the assessable value of the finished product, the documents and records of the appellants were verified. It was noticed that the appellant was undervaluing their final product by not including the value of the materials mainly thermocol, foam, bell pins, blue ink supplied free of cost by their buyers M/s.Saint Gobain Glass India Pvt. Ltd. through gate passes.
Show cause notice dated 08.10.2010 was issued to the appellant for the period April 2008 to February 2009 proposing to demand short paid duty along with interest and for imposing penalties. After due process of law, the original authority confirmed the duty along with interest and imposed penalty. On appeal, the Commissioner (Appeals) upheld the same. Hence this appeal.
Conclusion- The very same issue was considered in the case of CCE Vs Rane Brake Linings Ltd. 2017 (8) TMI 1388 CESTAT CHENNAI, wherein, it was held that such addition of free supplied parts is not to be included in the assessable value.
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