Yachio India Manufacturing Pvt. Ltd Versus Commissioner of Central Goods and Service Tax, Customs & Central Excise, Alwar
Central Excise
2018 (7) TMI 909 – CESTAT NEW DELHI – TMI
CESTAT NEW DELHI – AT
Dated:- 20-6-2018
Appeal No. E/51232/2018-EX (DB) – A/52294/2018-EX[DB]
Central Excise
Mr. Anil Choudhary, Member (Judicial) And Mr. Bijay Kumar, Member (Technical)
Sh. B.L Yadav, Adv for the appellant
Sh. M.R. Sharma, DR for the respondent
ORDER
Per: Bijay kumar
The present appeal is filed against the above mention Order-in-Appeal. The issue involve in this case pertains to inclusion of VAT subsidy amount in the form of Vat-37 B, challans, which can be utilize for subsequent period to discharge VAT, for arriving at the assessable value under Section 4 of the Central Excise Act, 1944. Accordingly, the Revenue proceeded to include such subsidy amount in the value of the goods cleared by the appellant and demanded the differential duty. Being aggrieved, the appe
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sidies. Such disbursement happens in the form of VAT 37 B, challan which can be utilized in subsequent periods to discharge VAT liability. The crux of the dispute in the present case is whether such subsidy amounts are required to be included in the assessable value of the goods manufactured by the appellants, in terms of Section 4 of the Central Excise Act. As per the concept of transaction value outlined in Section 4, with effect from 01/07/2000, any sales tax/VAT actually paid can be deducted from the transaction value for payment of excise duty. Revenue has taken the view that payment of VAT using 37B Challans cannot be considered as actual payment of VAT.
8. Both sides have referred to the decision of the Apex Court in the case of Super Synotex India Ltd. In the above decision the Apex Court has categorically held that after 01/07/2000, unless the sales tax/VAT is actually paid to the govt, no benefit towards excise duty can be given in terms of Section 4(3)(d). However, we note
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ng such subsidy challans cannot be taken as VAT actually paid.
10. It is pertinent to reproduce the observations of the Tribunal in the Welspun Corporation Ltd. case
“5.1 The Respondent company opted for “Remission of Tax Scheme” and was thus eligible for the Capital subsidy in the form of remission of Sales Tax subject to the conditions to be fulfilled…. The subsidy in the form of remission of sales tax was in fact a percentage of capital investment… Separate assessment orders were thus issued by the assessing officer of the sales tax department from time to time towards the incentive scheme amount. The Competent Authority was required to necessarily pass order for remission of such tax separately for each tax period. The remission of tax is thus directly related to capital investment in fixed asset. There was no option to claim exemption from payment of sales tax. The quantum of remission was based upon the investment made in the fixed assets. The condition of the remission a
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