GUJARAT GUARDIANS LIMITED Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THIS appeal has been filed by the appellant against Order -in -Original No. 01/Dem/Surat/2011 dated 15.11.2011, passed by Commissioner of Central Excise, Customs and Service Tax Commissionerate, Surat -II, confirming demands of Rs. 2,62,31,415/ - and Rs. 36,57,240/ - along with interest. Equivalent penalties have also been imposed by the adjudicating authority upon the appellant under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944. The issue involved in this appeal is whether Central Excise duty is required to be recovered from the appellant for those cash discounts availed at the time of removal/sales by the appellant for which prompt payments are not made by the customers within the specified period as per the definition of Transaction Value given in the present Section 4 of the Central Excise Act, 1944. The period involved in the present proceedings is from November 2006 to March 2010. Prior to November 2006, appellant was discharging Central Excise duty on the differential amount of cash discount as well as Trade discount which were not actually availed by the customers/buyers after the clearance.

(2.) SHRI S.J. Vyas (Advocate) appearing on behalf of the appellant argued that their case is squarely covered by the judgment of Mumbai Larger Bench in the case of CCE Mumbai vs. Arvind Mills Limited [ : 2006 (204) ELT 570 (Tri. LB)]. He relied upon the following case laws to the effect that as per judicial discipline, this bench can not distinguish or differentiate the law laid down by the Larger Bench on an issue: -

(3.) HEARD both sides and perused the case records. The issue involved in the present proceedings is whether Central Excise duty is required to be paid, for those cash discounts availed at the time of removal/sales by the appellant for which prompt payments are not made by the customers/buyers within the specified period, as per the definition of Transaction Value given in the new Section 4 of the Central Excise Act, 1944. Relevant portion of the old and new Section 4 on assessable value is reproduced below: -