Hawkins Cookers Limited Vs Commissioner of Central Goods & Service Tax (CESTAT Chandigarh)
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal considered six appeals filed against separate appellate orders upholding provisional assessment orders that had disallowed various post-clearance discounts while finalising assessable value under Section 4 of the Central Excise Act, 1944. The appeals covered different periods from April 2009 to March 2015 and involved duty demands aggregating to several lakhs of rupees.
The appellant was engaged in the manufacture and clearance of pressure cookers and their parts from its factory in Punjab. While pressure cookers were cleared on payment of duty under Section 4A, parts were cleared on transaction value. The goods were sold through 26 depots across the country. Revenue disallowed deductions claimed towards post-clearance discounts, including unallocated discounts, discounts under national pricing, and adjustments on account of taxes such as Central Sales Tax, Octroi, and Entry Tax, holding that these were not admissible under Section 4. Provisional assessments were finalised accordingly, and the disallowances were upheld by the impugned orders.
On behalf of the appellant, it was submitted that at the time of factory clearance, the exact sale price was not known because the actual quantum of discounts and taxes would be determined only later. The established practice, accepted by the Department prior to the disputed period, was to submit a Chartered Accountant certificate at the end of the financial year, on the basis of which assessments were finalised. It was argued that the discounts were never disputed either before or after the impugned period. Reliance was also placed on an earlier decision of the Mumbai Bench of the Tribunal in the appellant’s own case, where identical issues were decided in favour of the assessee. It was further pointed out that an appellate authority had subsequently held the appellant eligible for discounts on account of national pricing.
