ELECTROLUX KELVINATOR LTD. Vs. CCE

JUDGEMENT

(1.) THE appellant is a manufacturer of refrigerator. The issue that has arisen for decision is whether separately recovered warranty charge is includable in the assessable value of the refrigerator

(2.) THE facts in brief are that one -year warranty goes with the sale of refrigeration, its cost remains included in price of the refrigerator and duty is paid on that sale price. Additional warranty for four years is available on separate payment, the amount being Rs. 175 -200 per refrigerator. Under the impugned order, it has been held that the additional payment for your year warranty should also form part of the assessable value of the refrigerator, as though that was the normal price. What prevailed upon the authority for arriving at such a finding is that almost all the buyers are paying for the four -year additional warranty.

(3.) LEARNED Counsel for the appellants has submitted that the finding of the Commissioner is contrary to the sale documents. He took us through the warranty document and showed that the option for four year warranty is separately indicated. The learned counsel contended that once the transaction is according to written documents (sale warranty documents in the instant case) the terms of that document govern the transaction between the parties and a contrary claim is not sustainable. He has referred to the decision of the Hon'ble High Court at Guwahati in the case of Bhattacharjee Brothers Vs. Superintendent of Taxes, Dibrugarh and Others 1984 (63) STC in support of this submission regarding finality of the terms of a written contract.