News Update

ACC appoints IRS officer Ravi Singh as Addl Private Secretary to Power MinisterUSA favours 'reciprocal' free trade: Treasury ChiefShillong Customs seizes 800 kg of ganja concealed in especially-designed cavity in a truckCBEC Chairperson calls for speedy GST Awareness CampaignINTERPOL drive against illicit firearms - 149 arrested across EuropeGreen Bond Market Has Grown Healthy In 5 Yrs: IREDAIndia turning into hub of international arbitration: Chief Justice of IndiaTaliban forces kill over 100 Afghan soldiersGST Council looking for applicants to fill up CSSS postsEmerging economies account for 75% of global growth: FMDuty Credit Scrip can be utilised/debited for payment of Custom Duties in case of EO defaults - Para 3.18(a) of FTP 2015-20 amendedServices Exports from India Scheme - Eligible period extended up to 31.3.2017W.e.f. 01.06.2017 only those applications for grant of gold dore would be considered where the applicant refinery holds a valid licence from BISGlobal forex remittances shrink but India continues to be No 1International prices soar; Less availability of milk products this summer: GovtMGNREGA - One crore assets geotaggedInter-Ministerial Delegation going to participate in Basel conventionsRailways to organise Global Technology Conference on SafetyST - Once activity undertaken of supply of food to its workers at subsidized rate is understood to be part of Petitioner’s industrial obligation, it is unthinkable that same can be construed as service: HCGoods, after a tour of service abroad, imported by or along with a unit of the Army, Navy, Air Force or CRPF exempted from BCD, CVD & SAD subject to specified conditionsUS Fed Paper says GST may boost India's GDP by over 4%Garib Kalyan Yojana- If tax paid by Mar 31, declaration can be filed by May 10Removal of Cyprus as notified jurisdiction u/s 94A - CBDT clarifies removal notfn to have retro effect11th Civil Services Day: PM cautions officers against excessive use of social mediaApex Court questions Govt decision to link Aadhaar with PANUSD 250 bn Tax Bill - Australian Federal Court rules against ChevronCricket Betting case - CBI chargesheets IRS officer & others
 
CX - Since procurement price is decided by an open tender procedure, it cannot be said that transaction value has been influenced : CESTAT

By TIOL News Service

BANGALORE, APRIL 20, 2017: DURING the disputed period, appellant effected sale of Poly Iso Butane (PIB) to various Oil Marketing Companies (OMCs) pursuant to competitive bidding procedure in which various suppliers including appellant took part.

The Department disputed the transaction value between appellant and BPCL on the ground that both are related parties as per Section 4 of the Act. After process of adjudication, Commissioner confirmed demand of differential excise duty along interest and penalty.

Appellant is before the CESTAT and challenges the impugned order on merits as well as revenue neutrality and limitation.  Following case laws are also cited in support viz. Bharti Telecom Ltd - 2008-TIOL-124-SC-CX and Universal Luggage Mfg. Co. Ltd - 2005-TIOL-152-SC-CX. Revenue is also in appeal seeking imposition of equivalent penalty u/s 11AC and relies on the apex court decision in Dharamendra Textile Processors: - 2008- TIOL -192-SC-CX-LB .

After considering the submissions made by both sides, the Bench observed-

+ The various public sector units including OMCs are mandated by the Central Vigilance Commissioner to adopt the open tender procedure for procurement of goods. Such procedure is mandated with the objective of transparency in procurement and the possibility of lowest price discovery by open competition. Since the price of procurement of PIB for supply to BPCL has been decided by such an open tender procedure, it cannot be said that the transaction value has been influenced by the relationship between KRL and BPCL.

+ Further, there are also instances where KRL has supplied the same product at lesser prices than that to BPCL. It is also noted that the price of the product is also volatile as in the case of most petroleum products whose prices are ultimately depending on the price of crude oil. In the above circumstances, it cannot be said that the price at which KRL has supplied to BPCL is a preferential price influenced because of the special relationship between KRL and BPCL.

+ Revenue has not brought on record any evidence to indicate that price is not the sole consideration for sale of product to BPCL .

+ Transaction value is acceptable during disputed period in respect of clearances made to BPCL.

The assessee appeal was allowed and the Revenue appeal was dismissed.

(See 2017-TIOL-1319-CESTAT-BANG)


POST YOUR COMMENTS