JBM INDUSTRIES LTD. Vs. CCE, NEW DELHI

JUDGEMENT

(1.) The appellants were engaged in the manufacture of Cylinders. Those cylinders were supplied to M/s. Indian Petroleum Corpn. Ltd., M/s. Bharat Petroleum Corpn. Ltd. and Hindustan Petroleum Corp. These sales were evidenced by contracts entered into between manufacturer on one side and the oil companies on the others. In terms of those contracts, the goods were sent by the manufacturer by road for delivery at the buyer's premises. Cylinders os sold buy road were insured by the manufacture in their own name the freight charges were reimbursed. For the purpose of paying duty on cylinders, the right and insurance charge realised from oil companies were not added. Consequently, Show Cause Notices were issued emending differential duty reckoning the freight and insurance chages which should have been added to the value of the cylinders. Differential duty so claimed was in relation to the Cylinders cleared for the period from 28.9.96 to 31.3.98. The amount of duty claimed was Rs.11,64,551/ -.

(2.) The manufacturer of gas cylinders, appellant before us, disputed the claim on the ground that the clearance of other cylinder took place at the factory gate; that all expenditure incurred till that time were reckoned for the purpose of computing duty and that insurance charges and freight which were rembursed for cylinders at the premises of the oil company, cannot form part of assessable value. It was also contended that there was no suppression of facts, much less walful, to evade payment of duty. Therefore, the propriety of invoking the provisions of proviso to Section 11A(1) was questioned.

(3.) In view of the decision of this Tribunal in the case of M/s. Escorts JCB Ltd. vs CCE -2000(118)ELT.650 confirmed by the Larger Bench of this Tribunal in the case of Prabhat Zaroa Factory Ltd. vs CCE, New Delhi -2000(38)RLT.637, it has to be held that in computing the duty on gas cylinders, insurance and freight should be reckoned. Thus this issue having been decided against the appellant's contentions as per the above mentioned decision, we find no merit on this point.