ORDER
S.S. Sekhon, Member (T)
1. Heard both sides and considered the issue.
2. The present appeal has been filed against the order of the Commissioner (Appeals) who held that the so-called “credit cost” is not interest accruing on delayed realisation of the sale proceeds, but is additional consideration and is a part of the assessable value and required to be included in the value for the purpose of calculation and discharge of duty. The reasons on which he arrived at this findings are as follows:
“(v) The credit cost has been worked out not on any fixed percentage basis. It varies’ from consignment to consignment, customer to customer and also different for different size/shape of the product supplied to a single buyer
(vi) They have accepted the fact that they have charging “credit cost” from all their buyers.
(vii) They have also admitted that credit is finalised by mutual agreement between buyers. Generally, the price of the product is negotiated between the supplier and buyer interest for the credit, period. However, for credit period or for delayed payment is charged on “the basis of the prevailing interest rate ‘which is ‘always a fixed percentage and uniform for all buyers for a’ constant period whereas “credit cost” is not charged on any fix percentage basis or on uniform’ rate.
(viii) In respondent’s own, case for the earlier period, the various buyers in their recorded statements under Section 14 clearly admitted that they do not consider the . “credit cost” as, interest but the cost of their product
(ix) They do not charge anything on account of “credit cost” from their major buyer M/s. McDowell & Co.
(x) In respondent’s own case, Shri N., A., Bhandarkar in his statement dated 30.09.99 interalia deposed that the payment of interest made by the assessee were against their working capital loan and other capital loans obtained by them to run their business and all the interest paid for raising the capital and the working capital are loading the cost of the product manufactured. All these activities have’ taken place before, the clearance of the product from the factory to the buyers.”
3. On considering the fact that in the appellants’ own case, for another period, the finding of the Commissioner to the effect that “what the appellants are recovering on account of service charges are expenses made for the recovery of amount due to them from their customers on account of sales made on credit, was held to be correct and the Revenue’s appeals were dismissed, as reported in CCE, Bombay v. Haldyn Glass Works 1999 (110) ELT 897 (Tribunal) and this order of this Tribunal has been confirmed by the Supreme Court in an appeal by the Department as reported in 1999 (113) ELT A 64. Following the same, in this case also, we do not find any merits on the grounds as arrived at by the Ld Commissioner (Appeals) to consider that the amounts so recovered in this case are not amounts on account of credit sales i.e. interest on receivables, which is not required to be added or for the purpose of determining the assessable value. In this view of the matter, we find that the order of the Commissioner (Appeals)is required to be set aside and this appeal allowed.
4. Ordered accordingly.
(Pronounced in Court)