ORDER
U.L. Bhat, J. (President)
1. Order-in-Original No. 88/91 dated 30.9.1991 passed by the Collector of Central Excise, Bombay is under challenge in this appeal.
2. Appellant, engaged in the manufacture of aluminium structures like doors, windows, frames etc. was filing price lists from time to time and paying duty on approved prices. It was found that during the period from 1984-85 to 1988-89 appellant was collecting, besides the approved prices, licence fee for technical know-how supplied and royalty from customers and suppressed the same in all excise records. Accordingly, show cause notice dated 26.11.1989 was issued referring to the above facts and alleging fraud, misstatement of facts and suppression of facts with intent to evade duty and invoking larger period of limitation and proposing demand of differential duty. Though the appellant resisted the notice on merits and on the ground of limitation, the Collector confirmed the demand. Hence the appeal.
3. Learned Counsel for the appellant confined his submissions to the merits of the case and did not address argument on the question of limitation. There is no dispute that licence fee for technical know-how and royalty were not disclosed in excise records and the departmental officers came to know of receipt of such amounts only on scrutiny of balance sheets for the respective years. Appellant contended before the Collector that licence was being granted to various customers for supply of technical know-how in setting up plants for manufacture of aluminium structures similar to the products manufactured by the appellants and licence fee for technical know-how and royalty related only to such transactions and had nothing to do with the structures manufactured and supplied by the appellant to various buyers. The Collector found that there were cases where appellant supplied technical know-how and received licence fee and royalty without supply of aluminium structures to such customs and the fees and royalty received from such customers should be included from the differential assessable value. In other words, he directed inclusion in the assessable value of licence fee and royalty received from customers who purchased structures from the appellant.
4. Learned Counsel for the appellant referred us to a sample copy of agreement as well as an agreement signed with National Aluminium Company in 1976. He also referred us to page 35 of the paper book which contains particulars of sales made to licensees, royalty and licence fees during the accounting year 1988-89. The statement refers to 21 licensees. Of them only 17 licensees purchased structures from the appellant and two of the buyers of structures did not receive any technical know-how from the appellant. If the statement is correct it may probabilise the contention that the appellant had three kinds of customers, namely, those who only buy structures, those who receive only technical know-how and those who buy structures and receive technical know-how.
5. It is the contention of the appellant that technical know-how supplied was only to set up plants for the manufacture of structures similar to those manufactured by the appellant and had nothing to do with the excisable products sold by the appellant to the buyers. This is a matter for verification with reference to various agreements entered into by the appellant during the entire period in question. The Collector should have called for the agreements and verified the same before coining to a conclusion that technical know-how and royalty had something to do with the excisable products sold by the appellant to licensees. We are inclined to remand the matter so that a proper decision is arrived at after looking into all the relevant materials. Appellant shall produce before the jurisdictional adjudicating authority copies of nil agreements entered into during the period in question and also other relevant material throwing light on the nature and purpose of the technical know-how for which fees and royalty had been received during the period.
6. For the reasons indicated above, we set aside the impugned order and remand the case to the jurisdictional adjudicating authority for decision afresh in accordance with law and observations in this order.
7. The appeal is allowed.