By TIOL News Service

CHANDIGARH, AUG 02, 2016: THIS Revenue appeal was admitted for consideration of the following substantial question of law:

++ Whether the Central Excise Duty paid on transaction value arrived at on the quantity of petroleum products at normal temperature room temperature converted to the notional temperature of 15 degree temperature amounts to short payment of duty, and the method adopted for payment of duty, is in accordance with the provisions of the Central Excise Law?

The Assessee raised a preliminary objection regarding maintainability of the appeal. Referring to Sections35G and 35L of the CEA, 1944 the respondent stated that as the dispute is regarding valuation of the excisable goods, the appeal before the High Court is not maintainable.

The Counsel for the Revenue submitted that the issue raised in the present appeal is not regarding valuation but about quantum and volume of the goods.

The High Court noted that the Tribunal had considered the issue and recorded the following observations -

"8. In order to find answer to the above question, it would be useful to have a look on Section 4(1) of the Central Excise Act, which is reproduced thus:-

x x x

9. On plain reading of the above, it is clear that for the purpose of calculating the excise duty chargeable, the price charged if it is sole consideration for the sale, would be the transaction value. Admittedly, in the instant appeals, the goods have been cleared on payment of excise duty as per the price declared in the invoices. It is not the case of the department that other manufacturing companies to whom the oil was supplied at the rate based on the volume at 15C are the related parties. It is also not the case of the Revenue that invoice price was not the sole consideration for sale or the appellant/assessee has received any other additional consideration apart from the declared sale price. Thus, in our considered view, the appellant has rightly paid the excise duty as per transaction value in terms of Section 4 of the Central Excise Act and there is no justification for allegation of under-valuation of the goods with a view to evade excise duty."

Viewing that from the paragraphs recorded by the Tribunal it was evident that the issue was considered in the light of provisions of Section 4 of the Act, which deals with valuation of excisable goods, the High Court held that the appeal was not maintainable.

The Revenue appeal was dismissed.

(See 2016-TIOL-1597-HC-P&H-CX)