MEWAR TEXTILE MILLS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) M /s. Mewar Textile Mills was given an exemption from payment of sales tax, as part of Rehabilitation Scheme. However, they continued to collect Sales Tax from their buyers and kept the amount with themselves. The Central Excise authorities held in the impugned order that the amount realised by the Textile Mill, being only part of the price of the goods and not sales tax payable, should form part to the assessable value while paying Central Excise duty. In the appeal now it has been contended by the Textile Mill that the amount realized by them was in the nature of sales tax and they kept the amount with themselves only because of the Scheme of Rehabilitation. Therefore, the amount collected as tax should be attributed to Sales Tax payable and should not be included in the assessable value.

(2.) AS against the aforesaid submission of the appellant, ld. DR has submitted that what is deductable under Section 4(4)(d)(ii) of the Central Excise Act, is only the 'Sales Tax payable'. In the instant case as the appellant had been granted an exemption from Sales Tax, no Sales Tax was payable by them. Therefore, the Revenue was right in demanding the Central Excise duty on this amount, treating the same as part of normal price. Ld. DR has also drawn our attention to the decision of this Tribunal in the case of C.C.E., Bombay v. Bajaj Automobile Ltd. [1997 (93) E.L.T. 7051 Tribunal] wherein the Tribunal held that when exemption has been granted from Sales Tax, the amount so collected as Sales Tax is includible in assessable value because in such a situation Sales Tax is not 'payable'.

(3.) WE have perused the records and have considered the submissions made by both the sides. We find that the issue remains covered under the said order of the Tribunal against the appellant. Appeal fails and is dismissed.