MERCEDES-BENZ INDIA PVT. LTD. Vs. CCE

JUDGEMENT

(1.) The Appellants are engaged in manufacture of motor vehicles and parts thereof. Duty demand of Rs. 25,21,943 has been confirmed on the ground that the Appellants had collected road delivery charges (RDC) in respect of vehicles cleared by them over and above the actual amount spent by them. We heard both sides, who argued at length and also have gone through the records. Both sides indicated that they would like to make written submissions and accordingly they were permitted to file the same within 15 days. Both sides made written submissions which have also been taken into consideration.

(2.) Road delivery charges are collected in terms of agreement entered into with the dealers. According to the agreement, the Appellant arranges for transportation/ transit insurance on behalf of the dealer and undertakes to deliver the goods at the premises of the dealer. The agreement also clearly provides that the delivery shall be made "ex -factory". The transportation/delivery charges referred to as "Road Delivery Charges" (RDC) are recovered from the dealer by showing the same in sales invoices separately. On verification, it was found that in some cases, the difference between the RDC recovered and the actual RDC incurred would be positive and in some cases would be negative. The department has taken a stand that wherever such RDC is positive, the same is to be treated as additional charges and duty is to be paid.

(3.) Includibility of excess RDC collected -Appellants contended that once ex -factory price is available, Department cannot look into collection of charges post removal.