EICHER TRACTORS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) The appellants manufactures IC Engine. At the time of selling the IC Engines to their dealers, the appellant takes a security deposit at the rate Rs. 300/ - per unit of the goods from their dealers. This deposit is returned to them on production of vouchers containing the certificate of the ultimate buyer that the IC engine in question has been installed by the dealer. Thus, the deposit is to ensure that the dealer carries out installation work properly.

(2.) The impugned order has held that the deposit at the rate of Rs. 300/ -should also form part of the assessable value of IC engine.

(3.) It is the contention of the appellant that Rs. 300/ - is only a security deposit for installation and since, it is refunded on completion of installation work, it does not constitute the price of IC engine to form part of the transaction value. During the hearing of the case, the learned Chartered Accountant for the appellant submitted that this issue remains decided in favour of the appellant vide Final Order No. 2003/97 -A, dated 22 -10 -97 [1998 (98) E.L.T. 276 (Tri.)] of this Tribunal in appellant's own case in Appeal No. E/122/98. As against this, the learned SDR submitted that the 1997 order of this Tribunal is of no relevance since valuation provision under Central Excise law has been changed from 1st July, 2000, which is the period covered by the present order. Learned SDR pointed out that under new Valuation provision, goods are subjected to duty at the transaction value and transaction value has been defined as including warranty and other incidental consideration.