BHASKAR INDUSTRIAL DEVELOPMENT Vs. CCE

JUDGEMENT

(1.) The appellants are absent inspite of today's notice of hearing having been sent to them well in advance. Accordingly, we have heard Shri A.K. Mondal, ld. JDR and have gone through the impugned order.

(2.) Demand of duty of Rs. 16,834.75 (rupees sixteen thousand eight hundred and thirty four and seventy five paise) in both the appeals has been confirmed against the appellants on the ground that the inspection charges paid to RITES by the railway authorities in respect of the final product manufactured by the appellant under a contract with the railways is required to be added in the assessable value of the goods. We find that the original adjudicating authority while deciding the case had dropped the proceedings against the appellants by following the earlier decision of the Tribunal in the case of Shree Pipes Ltd. v. CCE . The impugned order has been passed by the commissioner (Appeals) on an application by the Revenue. He observed that it is immaterial as to who has paid the inspection charges and once the inspection is undertaken before the delivery of the goods, the same has to be added in the assessable value in terms of the provisions of Section 4 of the Central Excise Act. As such by observing so he reversed the order of the original adjudicating authority.

(3.) However, we are not in agreement with the above view of the Commissioner (Appeals). It is seen that the Tribunals decision in the case of Shree Pipes Ltd. relied upon by the original adjudicating authority has been approved by the Hon'ble Supreme Court when the appeal filed by the Revenue was dismissed. We also note that the Tribunal in the case of General Engg. Works v. Collector (order No.54 -55/96 -A) has held that value of inspection charges for inspecting the goods manufactured by the assessees, by RITES (an agency of the Indian Railways) at the instance of the railways was not to be included in the assessable value. The appeal filed by the Commissioner against the above order of the Tribunal has since been dismissed by the Hon'ble Supreme Court as reported in 1997 ELT A -141. Inasmuch as the issue stands decided in favour of the appellants we dispense with the condition of predeposit of the duty and allow the appeals itself. The impugned order is accordingly set aside. Dictated in the Court.