HINDUSTAN MOTORS LIMITED Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) BY the impugned order demand of duty of Rs. 57,71,287/ - together with interest has been confirmed against the appellants, who are manufacturers of motor vehicles, as representing differential value of motor vehicles cleared by the appellants to the dealers during the period September 2001 to December 2005, such differential value being the cost of advertisement incurred by the dealers. In addition, penalty of equal amount has been imposed upon the assessee.

(2.) WE have heard both sides on the appeal against the demand. We find that the issue, as to whether such advertisement expenses incurred by the dealers in the absence of any obligation on the part of the dealers under any agreement with the manufacturers, is no longer res integra as it stands settled by the decisions of the Tribunal in the context of amended Section 4 , in the case of Featherlite Products (P) Ltd. v. CCE, Bangalore, 2005 (191) ELT 487 (Tri. Bang) and Amco Batteries Limited v. CCE, Bangalore by the Tribunal holding that the advertisement and sales promotion expenses incurred by the dealers themselves for their own purpose are not includible in the assessable value of the goods manufactured and cleared by the appellants. In the present case, there is no written agreement or any obligation in the dealers to incur advertisement expenses and oral agreement either has been presumed or inferred by the adjudicating authority.