C.C.E. Vs. THE SUPREME INDUSTRIES LTD.
LAWS(CE)-2015-2-9
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
Decided on February 12,2015

C.C.E. Appellant
VERSUS
The Supreme Industries Ltd. Respondents


Referred Judgements :-

ELECTRICAL PRODUCTS CORPORATION V. COMMISSIONER OF CENTRAL EXCISE [REFERRED TO]
HARI CHAND SHRI GOPAL V. COLLECTOR OF CENTRAL EXCISE,MEERUT [REFERRED TO]
JOINT COMMISSIONER OF INCOME TAX,SURAT V. SAHELI LEASING & INDUSTRIES LTD [REFERRED TO]
BOMBAY CHEMICALS LTD. V. COMMISSIONER OF CENTRAL EXCISE,BOMBAY -II [REFERRED TO]
COMMISSIONER OF CENTRAL EXCISE V. D.H. WOODHEAD [REFERRED TO]


JUDGEMENT

D.N. Panda, Member (J) - (1.)E/161/2004
(2.)IN this appeal, Revenue has come in appeal challenging the order (at page 9 of the appeal folder) passed by learned Commissioner (Appeals) on 21.10.2003 giving effect to the Final Order No. 1180/2000 dated 21.8.2000 passed in Appeal No. E/727/2000 (Ref. page 17 of the compilation filed). In that order, Tribunal directed learned Commissioner (Appeals) to give finding on the trade discount allowed by assessee to different parties at different rates disputed by Revenue in adjudication. While giving effect to the above order dated 21.8.2000 of Tribunal by learned Commissioner (Appeals), reliance was placed by him on the order dated 26.4.1999 of Commissioner of Trichy who held that trade discount of the above nature is permissible. But being aggrieved by such decision, Revenue came in appeal before Tribunal in Appeal No. E/882/2000. Such appeal of Revenue was decided by Tribunal against it as is reported in, 2008 (222) ELT 520 (Tri. Chennai). Tribunal held that the pattern of discount being allowed was declared in the price list filed by respondents therein (assessee) with the department periodically for which the adjudication was held to be barred by limitation. To reach to such conclusion, Tribunal recorded its reasoning in para 2 of the reported order as under: -
"2. Grounds stated in the appeal as regards the first issue are that the distributor not being buyer of the goods was a commission agent and the discount received by the distributor was a commission and not discount eligible for abatement from the list price. We find that the Commissioner has passed this part of the order following several judicial authorities as mentioned below: -

"(i) Electrical Products Corporation v. Commissioner of Central Excise [ : 1989 (43) E.L.T. 70 (Tri.)].

(ii) Commissioner of Central Excise v. D.H. Woodhead [1998 (29) R.L.T. 328 (CEGAT)].

(iii) Bombay Chemicals Ltd. v. Commissioner of Central Excise, Bombay -II [1998 (29) R.L.T. 112 (CEGAT].

(iv) Hari Chand Shri Gopal v. Collector of Central Excise, Meerut [ : 1998 (28) R.L.T. 494 (CEGAT)]"

The ratio of these decisions is that as long as the assessee charged the price less the declared discount, though part of the discount was paid to the distributor to whom the assessee had assigned the territory for distribution of assessee's goods where the buyer was located, the entire discount was eligible for abatement. The Commissioner found that facts of the case in Electrical Products Corporation v. Commissioner of Central Excise (supra) were that the appellants had sold part of their goods to the wholesale dealers allowing discount as mentioned in the price list and part of the goods to sub -dealers on the advice of the wholesale dealers at a lower discount. The Tribunal had observed that the plea that the wholesale dealers were functioning as commission agents was not tenable. The net realisation by the appellants in all cases were as per price list filed and approved. Hence the appellants were eligible for full discount. In the case of Hari Chand Shri Gopal case (supra), the Tribunal found that the trade discount of 20% was given to sub -dealer and 2.5% of the discount taken back and paid to main dealer in whose jurisdiction the sub -dealer was located. The Tribunal held that 20% was admissible for deduction as main dealers were not selling agents. The Commissioner found that in the instant case, the distributors were not commission agents and, therefore, the assessee had abated the discount correctly for the purpose of payment of duty."

[Emphasis supplied]

(3.)RECORD also reveals that while deciding the issue above, the Trichy Commissioner relied on the order of learned Commissioner (Appeals) passed on 11.1.1999 in appeal 50/1999. In that appeal, the Commissioner (Appeals) in para 3 of his order relied on his decision made in appeal 193/98 -TRY (no date stated).
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