HINDUSTAN LEVER LTD. Vs. CCE

JUDGEMENT

(1.) After examining the records and hearing both sides, we are of view that the appeal itself requires to be finally disposed of at this stage. Accordingly, after dispensing with pre -deposit, we take up the appeal for disposal.

(2.) The appellants had manufactured and cleared packaged tea during the period 2.6.1998 to 28.2.1999 to C&F Agents on payment of duty on assessable value in which sales tax, additional sales tax, freight, and octroi (if payable in the State) were included on equalised basis. They, however, had not included in the assessable value octroi (where it was not payable in the State), trade discount, discount for damages and bank charges on equalised basis. The department took the view that these elements were not admissible abatements from assessable value under Section 4 of the Central Excise Act, 1944. Accordingly, a show -cause notice was issued to recover the differential duty attributable to the above elements (octroi, discounts and bank charges) of assessable value. The demand was contented. The adjudicating authority disallowed the above abatements from assessable value and confirmed demand of duty amounting to over Rs. 35 lakhs for the aforesaid period. The demand was, mainly, on the basis of a finding that the assessee had not adduced evidence to show that the above elements were collected on equalised basis. The adjudicating authority did not accept the assessee's statements certified by Chartered Accountant, as conclusive evidence in this regard. Against the decision of the original authority, the assessee appealed to the Commissioner (Appeals). The appellate authority accepted the assessee's view in principal and held that the above elements were admissible abatements from assessable value. It, however, upheld the finding of the lower authority that the assessee had not substantiated their case by adducing sufficient evidence. It found that they had not produced the relevant invoices issued by the C&F Agents. The present appeal is against the order of the Commissioner (Appeals).

(3.) Ld. CA relies on Board's Circular No. 20/90 -CX -1 dated 30.8.1990 and submits that it has ever been the Board's view that, in respect of assessees who had a network of dealers all over the country, it was necessary for them to have uniform retail price by equalising local taxes, octroi etc. and that the assessable value of the goods should be got approved accordingly for the purpose of Central Excise levy. He has also relied on the Tribunal's decision in Hindustan Lever Ltd. v. CCE, Rajkot , wherein it was held that deductions on account of turnover tax, sales tax and equalised freight were not to be disallowed on account of non -production of invoices when such deduction was claimed on equalised basis. Reliance has also been placed on the Bombay High Court's judgment in Advani Oerlikon Ltd. v. UOI , wherein the Hon'ble High Court held that, where the assessee had produced consolidated statement duly certified by Chartered Accountant, it was not correct on the part of the Assistant Commissioner to turn down their claim for abatement on the only ground that each and every voucher and freight bill issued by them during the period of dispute was not produced. Therefore, ld. CA submits that the assessee's statements duly certified by Chartered Accountant, which were produced before the original authority, were enough evidence of octroi etc. Having been billed on equalised basis and it was not open to the authority to demand production of invoices. Ld. DR submits that it was incumbent on the assessee to substantiate their case before the authorities by adducing conclusive evidence. The Commissioner (Appeals) has accepted the assessee's arguments in principle and rightly directed them to substantiate their case by adducing conclusive evidence in the form of invoices.