ORDER
K.S. Venkataramani, Member (T)
1. The issue in this appeal relates to whether the amount collected by the appellants herein as interest on delayed payments in respect of White Cement manufactured by them, is to be included or not in the assessable value of the goods. When the matter was called, both the sides pointed out that the issue stands settled in respect of this very same appellants by the Order Nos. 315-316/93-A, dt. 28-6-1993.
2. We have perused this order. Para 3 of the Tribunal’s order is reproduced below :-
“We have carefully considered the pleas advanced on both sides. Method of declaration of the price by the assessee is no doubt somewhat unusual in as much as normally a normal price is declared by an assessee and then discounts are claimed as deductions therefrom. However, merely because an unusual pattern of declaration of price has been adopted by the appellant, he cannot be denied the benefit of interest on delayed payments because the lower authorities have not found that these extra charges collected by the appellant at a flat rate of Rs. 80/- M.T. are anything else but interest on delayed payment. Similarly, there may be a suspicion regarding the nature of collection in as much as the collection is made at a flat rate of Rs. 80/- per M.T. i.e. Rs. 4/-per bag of 50 kgs. of white cement whereas charging interest on delayed payment at a percentage of value of the goods at the normal practice in trade is but this suspicion by itself will not be adequate enough to charge duty on it in the face of admission by the lower authorities that it is a collection on account of delayed payment of the price of the goods purchased by the customers. Reliance placed by the 1d. Advocate on Rajasthan High Court’s decision in DCM Shriram’s case is apt. The High Court has observed as follows :-
“…The case of the petitioners in fact is covered by series of decisions and even by the clarification which was issued by the Department as Departmental Instructions issued when Section 4 of the Act of 1944 was amended vide Amendment Act 22 of 1973. The instructions which were issued vide MF(DR1) F. No. 312/1/75-CX10, dt. 8th August, 1975 clearly contained therein that the price mentioned in definition means the amount of money for which the goods are sold. In other words it means cash consideration but mere fact that credit is given for the payment of value of an article would not result in the amount ceasing to be a price. The illustration was also given under the instructions and the illustration reads as under :-
‘Assessee A charge Rs. 100/- per unit for his goods if the payment is made at the time of delivery but charges Rs. 102/- per unit if the payment is made after one month of the delivery, Rs. 100/- per unit will be price of goods if the extra charge of Rs. 2/- per unit is identifiable as being relatable to the time lag in payment.’.”
Accordingly, the appeals are allowed on this issue with consequential relief to the appellant.”
The Tribunal has clearly held that such charges will not form a part of the assessable value. The decision squarely covers the facts of this case and following the ratio we set aside the impugned order of the Collector (Appeals) and allow the appeal.
