ORDER
Shri Jeet Ram Kait
1. This Revenue appeal is against the Order-in-Appeal No. 283/96 (CBE) dated 30.4.94 by which the Commissioner has allowed the party’s appeal and the findings recorded in para-2 to 4 are reproduced below:-
“2. In the ground of appeal, the appellants contend that they have received deposits only from four dealers and it is not informs. The transaction is on principal to principal basis in the course of wholesale trade. There is no depression in the wholesale price on account of security deposits received. The ex-factory price is same for both the buyers who have deposited and the buyer’s who have not made any deposit. The price charged is as per the contract. They have also cited the case of Laxmi Machine Works Ltd. Vs CCE, Madras and Board’s letter F.No.2/2/86 dated 20-10-95 and contend that the department has to establish that additional consideration has a nexus to the sale price. The ratio of decision reported in 1988 (36) ELT 730 (SC) and 1995 (75) ELT 499 (SC) which are relied upon by the Assistant Commissioner would not be made applicable in their case because the circumstances and facts are different. During hearing the representative stated that the issue is similar to the one already decided vide my Order-in-Appeal No. 20 & 21/95(CBE).
3. I have considered a number of appeals on this issues and have been consistently holding that unless it is established that the receipt of advances had led to a depression in the price, the notional interest on such advances cannot be taken into account while determining the assessable value under Section 4. The lower authority would no doubt state that the advances received has an effect on the price. Mere statement is insufficient because it has to be established that the buyers who paid advances were favoured buyers and that a specifically low price had been charged to them. Further, I also find that the appellants have contended before the lower authority that the price is the same irrespective of the fact whether the customer pays advances or not the Assistant Commissioner has not given any findings on this aspect.
4. In this view the impugned order cannot be sustained and therefore, I set aside the impugned order and allow the appeal. The issue is no longer res integra and we have decided a number of cases on identical point and on similar orders passed by the Commissioners that notional interest on advances/security deposit taken from the customers is not includible in the assessable value in terms of the Supreme Court judgement rendered in the case of VST INDUSTRIES Vs CCE Hyderabad reported in 1998 (77) ELT 395 (SC) as well as in number of cases this Tribunal has also confirmed the orders of the Commissioner (Appeals) as well as other Commissioners holding that notional interest on advances cannot be added to the assessable value in the absence of any proof that there was any depression of price because of these advances.”
2. The common ground taken is that assessees have not included the notional interest accrued on the advances received from their customers and that the differential duty on this account was payable.
3. Heard both sides.
4. We had an occasion to hear large number of appeals on the same issue wherein Revenue is aggrieved with the similar orders. The Tribunal after considering those appeals rejected the appeals of Revenue. One such matter came up before the Tribunal in the case of CCE Vs Coimbatore Vs SERVAL ENGG. WORKS (P) LTD wherein the contention of Revenue was rejected by confirming its earlier findings which was extracted in final order No. 878 to 893/01 dated 6.6.01 herein below :-
“8. We have carefully considered the submissions made by Ld.SDR & DRs who appeared for the Revenue and Ld. Counsel Shri J. Narayanaswamy who appeared for the respondent namely M/s. Sree Andal & Co. The learned Commissioner (Appeals) had thoroughly examined this matter and has given his detailed findings in paras-3 & 4 of his order which have been extracted supra and therefore respectfully following the various Tribunal’s judgements, cited by the learned Counsel for the respondents, we do not find any merit in the appeals filed by the Revenue and therefore the order of the Commissioner (Appeals) is confirmed and appeals filed by the Department are dismissed. We also note, by Final Order No. 737 to 761/01 dated 24.5.01 in the case of CCE Vs UNIVERSAL HEAT EXCHANGES LTD & OTHERS by final order No. 806 to 840/01 dt 1.6.01, the impugned order has already been set aside by following the ratio of the above cases. Thus, the Revenue appeals are accordingly dismissed.”
5. Respectfully following the ratio of the above Tribunal decision and also the issue being settled one in the view of various decisions of this Tribunal on the similar issue, we apply the same ratio to this case also and accordingly reject these Revenue appeal.
(Dictated and Pronounced in open court)