MARUTI UDYOG LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) IN this appeal at the instance of the assessee the issue involved is whether the transportation charges as well as the service charges received from the buyers of the motor vehicles manufactured by the appellant are liable to be included in the assessable value.

(2.) THE appellants are engaged in the manufacture of motor vehicles falling under Chapter 87 of the Schedule to the Central Excise Tariff Act, 1985. These vehicles are sold to dealers all over the country who in turn sell the same to customers. Sales are effected on the basis of agreements entered into with the dealers. In certain cases the dealers directly take delivery of the vehicles from the factory gate, in other cases on their request the appellants undertake to transport the vehicles from the factory gate to the premises of dealer. It is the case of the appellants that the sale takes' place at the factory gate in all cases and therefore, the transport charges incurred initially by the appellant and reimbursed by the dealers are not liable to be added to the assessable value of the goods. The appellants also collect an amount towards service charges from the buyers to make good the cost of repairing the vehicles damaged during transit. According to the appellants, this amount is also not liable to be included in the assessable value. The above contention of the assessee was not accepted by the Commissioner relying on the decisions of this Tribunal in Prabhat Zarda Factory Ltd. v. CCE, Meerut -II - 2002 (119) E.L.T. 191 (Tri. -LB) and Escorts JCB Ltd. v. CCE Delhi - 2000 (118) E.L.T. 650 (T) = 1999 (35) RLT 9 (CEGAT).

(3.) IT is contended before us by the learned Counsel for the appellants that the two decisions relied by the Commissioner have been later reversed by the Supreme Court in Escorts JCB Ltd. v. CCE - 2002 (146) E.L.T. 31 (S.C.) and Prabhat Zarda Factory Ltd. v. CCE - 2002 (146) E.L.T. 497 (S.C.) = 2002 (53) RLT 883 (S.C.). He submits that the property in the goods passes at the factory gate and therefore, any amount received towards the transportation charges and service charges cannot be added to the assessable value. It is pointed out that invoices, copies of which are made available to us, contain a declaration "Delivery Ex -factory at Gurgaon Risk passes to buyer on delivery at Gurgaon". It is pointed out that invoices contain all particulars like model number, engine number, chassis number, colour etc. of each vehicle which would indicate that the appropriation has taken effect at the factory. The invoices show separately the transportation charges and the service charges. The lorry receipts and railway receipts would indicate the dealer as the consignee.