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AIT-2015-154-CESTAT

 

IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI

 

APPEAL No. E/85253/14-Mum

 

(Arising out of Order-in-Original No. 94-95/MAK(94-95)/COMMR/RGD/13-14 dated 12.11.2013 passed by Commissioner of Central Excise, Raigad)

 

Commissioner of Central Excise, Raigad-Appellant

 

Vs.

 

Uttam Galva Steels Ltd.-Respondent

 

AIT Head Note: All the manufacturer-assessees in these appeals have availed benefit of deferred sales tax scheme and thereafter opted to pay the deferred tax in advance. Amount paid was equal to NPV and not the originally deferred amount. With this payment, total liability to pay sales tax extinguished.(Para 2)

 

At the time of clearance of the goods, the excise duty was paid based upon the sale price excluding the sales tax payable. The sales tax payable was computed based upon the normal rate of sales tax. However, since the sales tax amount was later on paid as per NPV and not as per the originally projected sales tax amount payable, the Revenue is of the view that the manufacturer-assessees are eligible only to deduct the NPV amount from the selling price. Thus the differential between the deferred sale tax payable and NPV paid would form part of the assessable value and the demands have been raised on the said amount. The manufacturer-assessees, on the other hand, are of the view that the sales tax amount payable was as per the sales tax rate applicable on the goods or the deferred amount of sales tax and thus they are liable to pay excise duty on the price excluding the deferred sales tax payable. Exercising the option to wipe out the deferred tax liability on NPV will not make any difference in their liability to pay excise duty.(Para 3)

 

It would thus be seen from the above three circulars that the Board has all along been of the view that under the deferment scheme of sales tax, the sales tax is payable though after a long period of time and since the sales tax is payable, the same will stand excluded from the normal value or the transaction value. (Para 38.3)

 

as far as the Sales Tax Act authorities are concerned, whole of the deferred sales tax amount payable has been paid by the assessee/dealer. The fact that the said amount has been paid after the clearances of the goods and before the deferred date of payment, to our view will not make any difference. Further, the actual amount paid is equal to NPV (which is less than originally payable), cannot make the amount actually payable at the time and place of removal different, particularly when under Sales Tax Law such a payment is considered as deemed payment of the sales tax payable. Quantum of sales tax payable does not change in the above scheme of pre-payment.(Para 39)

 

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