COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS, BANGALOREversusM/S JSW STEEL LTD. (FORMERLY KNOWN AS JINDAL VIJAYANAGAR STEEL LTD.)

938                      [2019]REPORTS
               SUPREME COURT    6 S.C.R. 938              [2019] 6 S.C.R.


A              COMMISSIONER OF CENTRAL EXCISE AND
                      CUSTOMS, BANGALORE
                                v.
                       M/S JSW STEEL LTD.
            (FORMERLY KNOWN AS JINDAL VIJAYANAGAR
B
                            STEEL LTD.)
                    (Civil Appeal No.531 of 2008)
                                APRIL 09, 2019
       [S.A. BOBDE, DEEPAK GUPTA AND VINEET SARAN, JJ.]
C
             Central Excise Act, 1944 – ss.4 and 11AB – Respondent
      manufactured Pig Iron and HR Coil Sheets, falling under Chapter
      72, 1985 Act – While selling the goods, invoices were raised on the
      price of goods plus ‘Dharmada’, a charitable donation from
      customers, which was credited to charity – Show cause notice issued
D     by the Deputy Commissioner, Central Excise and Customs, Bellary
      calling upon the Respondent to show cause as to why penalty
      u/r.25, 2002 Rules and interest u/s.11AB, 1944 Act be not levied –
      Deputy Commissioner held that the Dharmada is to be added to the
      assessable value for the payment of central excise duty –
      Commissioner (Appeals) confirmed the order – CESTAT set aside
E
      the order – On appeal, held: Present case has been tagged with
      M/s. D.J. Malpani vs. Commissioner of Central Excise, Nashik, [2019]
      6 SCR 925 wherein it was held that the amount of Dharmada cannot
      be included in the transaction value for the purposes of assessments
      – In view of the said judgment, the present appeal is dismissed –
F     Central Excise Rules, 2002 – r.25 – Central Excise Tariff Act, 1985
      – Chapter 72.
            Dismissing the appeal, the Court
            HELD: 1.1 The present case has been tagged with the case
      of M/s D.J. Malpani vs. Commissioner of Central Excise, Nashik
G     which was referred to this Bench vide order dated 29.07.2015. It
      was held that the amount of Dharmada cannot be included in the
      transaction value for the purposes of assessments. In view of the
      judgment in the case of Civil Appeal No. 5282 of 2005, M/s D.J.
      Malpani vs. Commissioner of Central Excise, Nashik, the present
H     appeal is dismissed. [Paras 5, 6][940-D-E]
                                  938
        COMMIR.. OF CENTRAL EXCISE AND CUSTOMS,                              939
            BANGALORE v. M/S JSW STEEL LTD.

        M/s D.J. Malpani vs. Commissioner of Central Excise,                 A
        Nashik [2019] 6 SCR 925 – relied on.
        Collector v. Panchmukhi Engineering Works (2003)
        (158) ELT 550 (SC) – referred to.
                         Case Law Reference
                                                                             B
        [2019] 6 SCR 925                  relied on        Para 6
        (2003) (158) ELT 550 (SC)         referred to      Para 4
        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 531 of
2008.
                                                                             C
      From the Judgment and Order No. 440/2007 dated 04.4.2007 of
the Customs, Excise and Service Tax Appellate Tribunal, South Zonal
Bench, Bangalore in Appeal No. E/395/2005.
      K. Radhakrishnan, S. K. Bagaria, Sr. Advs., Alok Yadav,
K. Ajit Singh, Praveen Kumar, Ms. Nisha Bagchi, Ms. Aruna Gupta,
                                                                             D
B. Krishna Prasad, U. A. Rana, Himanshu Mehta,(for M/s. Gagrat and
Co,) Advs. for the appearing parties.
        The Judgment of the Court was delivered by
       S.A. BOBDE, J. 1. The Revenue-Appellant has come in appeal
against the order of the Central Excise and Service Tax Appellant Tribunal   E
(for short “CESTAT”) dated 04.04.2007. The Respondent manufactured
goods falling under Chapter 72 of The Central Excise Tariff Act, 1985.
The Respondent manufactured Pig Iron and HR Coil Sheets. While selling
the goods they raised invoices on the price of goods plus ‘Dharmada’ a
charitable donation from customers. According to the Respondent, the
Dharmada was meant for charity and was accordingly credited to charity.      F

       2. However, show cause notice dated 19.03.2004 was issued by
the office of the Deputy Commissioner of Central Excise and Customs,
Bellary under Section 4 of the Act calling upon the Respondent to show
cause as to why penalty under Rule 25 of Central Excise Rules, 2002
and interest under Section 11AB of the Central Excise Act, 1944 should       G
not be levied. After hearing the Respondent, the Deputy Commissioner
vide order dated 10.09.2004 held that the Dharmada is to be added to
the assessable value for the payment of central excise duty.
    3. Thereafter, in an appeal filed by the Respondent, the
Commissioner (Appeals), confirmed the decision of the Deputy                 H
940                SUPREME COURT REPORTS                      [2019] 6 S.C.R.


A     Commissioner and rejected the appeal and held that Dharmada should
      be added to the assessable value. Therefore, the goods were liable to be
      assessed on the basis of their price plus Dharmada.
             The CESTAT in an appeal filed by the Respondent, by judgement
      dated 04.04.2007, allowed the appeal and set aside the order passed by
B     Commissioner (Appeals) dated 29.03.2005. The CESTAT purported to
      follow its judgment in the case of Mohan and Co., Madras vs. CCE
      Madras, which was affirmed by the Supreme Court in appeal, whereby
      this Court held that Dharmada was not liable to be added in the assessable
      value.
C            4. Thereafter, in Civil Appeal No.531 of 2008 before this Court, it
      was contended by the Appellant before a Division Bench of this Court,
      that the decision in Collector vs. Panchmukhi Engineering Works1 was
      to be followed. Thus, contending that Dharmada should be a part of the
      assessable value.
D            5. The present case has been tagged with the case of M/s D.J.
      Malpani vs. Commissioner of Central Excise, Nashik which has been
      referred to this Bench vide order dated 29.07.2015. We have held that
      the amount of Dharmada cannot be included in the transaction value for
      the purposes of assessments.

E           6. In view of the judgment in the case of Civil Appeal No. 5282 of
      2005, M/s D.J. Malpani vs. Commissioner of Central Excise, Nashik,
      we hereby dismiss the present appeal.


      Divya Pandey                                               Appeal dismissed.
F




G     1
          2003 (158) ELT 550 (SC)




H