Order Date – 01 June 2023

Parties: M/s. Concrete Products and Construction Co. Vs Commissioner of GST & Central Excise, Chennai North Commissionerate

Facts – 

• The Appellant, M/s. Concrete Products and Construction Co., are engaged in manufacture of Concrete Sleepers and are also availing CENVAT Credit facility of duty paid on inputs.
• On verification of records, it was found that the appellant had collected outward freight chargers from their customers and paid lesser freight to the transporters. They had included only the lesser freight in the assessable value while discharging the excise duty on finished products.
• A Show Cause Notice dated 21.04.2011 was issued proposing to demand the duty of excise on freight collected for the period March 2009 – February 2011 along with interest and for imposing penalties. The demand was confirmed.

Issue – 

• Whether the appellant has to include the surplus freight charges that have been collected from the customers in the assessable value for discharging the Central Excise Duty?

Order – 

• The Tribunal observed that the issue was considered by the Hon’ble Apex Court in the case of Indian Oxygen Ltd. It was held that Insofar as the loading charges Incurred for loading the goods within the factory are concerned, they are to be included in the assessable value, irrespective of who has paid for the same but the loading expenses incurred outside the factory gate are excludible. Duty is excise to a tax on the manufacture, not a tax on the profits made by a dealer on transportation.
• After appreciating the evidence and following the decisions as cited above, the demand cannot sustain. In the result, the impugned order is set aside. Appeal is allowed.