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<!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd"> <html xmlns="http://www.w3.org/1999/xhtml"> <head> </head> <body> <div style="font-family:Verdana, Geneva, sans-serif; font-size:12px; text-align:justify"> <table width="800" border="0" style="border:1px solid #ccc;padding:5px;" align="center" cellpadding="6" cellspacing="0"> <tr> <td align="left" valign="top"> Customs, Excise and Service Tax Appellate Tribunal Transfer of ownership takes place at the factory gate, when the goods are delivered MANU/CN/0029/2024 - (14 Feb 2024) </td> </tr> <tr> <td align="left" valign="top">Commissioner of Central Tax, GST &Service Tax vs. Telecom Network Solutions Pvt Ltd</td> </tr> <tr> <td align="left" valign="top" style="background-color:#FDEDCE">The Respondent is engaged in the manufacture of "M.S. Fabricated Hot Dip Galvanized Steel Structures (Tower)". During the course of Audit, it was observed by the Audit party that, the Respondent charged freight from their buyers but did include the same in the transaction value in terms of Section 4(3)(d) of the Central Excise Act, 1944 . 
Accordingly, Show Cause Notice covering period up to October, 2015 demanding Central Excise duty amounting to Rs.20,90,082 has been issued. For the further period i.e. November, 2015 to June, 2017 statement of demand dated 30.11.2017 has been issued demanding central excise duty amounting to Rs.51,81,676 alongwith applicable interest and also proposal to impose penalty under the provisions of Rule 25 of Central Excise Rules, 20023 read with Section 11AC of the Act. The Adjudicating Authority vide Order-in-Original confirmed the demand as proposed in the show cause notice and imposed penalty of Rs.51,81,676 under the provisions of Rule 25 of the Rules readwith Section 11AC of the Act. 
Being aggrieved, the assessee filed appeal before the first Appellate Authority and the learned Commissioner (Appeals) allowed the appeal before him by setting aside the Order-in- Original. Being aggrieved by the impugned Order-in-Appeal, the Revenue has filed the present appeal before the Tribunal. 
As per Rule 5 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000- wherein excisable value of goods are sold in the circumstances specified in clause (a) of sub-section (1) of Section (4) of the Act, except the circumstances in which the excisable value of goods are sold for delivery at a place other than the place of removal, then the value of such excisable value shall be deemed to be the transaction value, excluding the cost of transportation from the place of removal up to the place of delivery of such excisable goods. 
The Respondent had arranged for the transport of goods to buyer's addresses and the freight charges were mentioned separately in the invoices. The goods after manufacturing in the plant of the Respondent were subject to pre-delivery inspection by the buyer and were ascertained in favour of the particular buyer before the delivery. In the invoices, the Respondent have charged sales tax and have reflected freight separately in most of the cases. Transfer of ownership takes place at the factory gate when the goods are delivered. Accordingly, there is no reason to interfere with the impugned Order-in-Appeal passed by the learned Commissioner (Appeals) and the same is sustained. The appeal filed by the Appellant Revenue is rejected.</td> </tr> <tr> <td align="left" valign="top" ></td> </tr> <tr> <td align="left" valign="top" >Tags : Demand, Confirmation, Legality</td> </tr> <tr> <td align="left" valign="top">&nbsp;</td> </tr> <tr>  <td align="left" valign="top">Source : newsroom.manupatra.com</td> </tr> <tr> <td align="left" valign="top">&nbsp;</td> </tr> <tr> <td align="left" valign="top">Regards</td> </tr> <tr> <td align="left" valign="top">Team Manupatra</td> </tr> <tr> <td align="left" valign="top">&nbsp;</td> </tr> </table> </div> </body> </html>