P.C. Jain, Member (T)

1. Since common issues are involved, a common order is being passed.

1.1 The appellant herein filed a Price List No. 472/P/86-87 w.e.f. 26-3-1987 claiming certain deductions in the price list. The Assistant Collector issued a show cause notice in respect of the various items of deductions claimed proposing to disallow them and also setting forth the reasons as to why these were not permissible. Deductions claimed are as follows :

(i) Payment of Central Excise duty @ 10% ad valorem claiming deduction of duty @ 20% from the prices at which the goods have been sold to the buyers.

(ii) Wooden packing charges.

(iii) Deductions on account of certain accessories, such as Daizy Wheel, Carbon Ribbon and Correction Tape.

(iv) Installation and training charges.

(v) Freight on ah average basis.

1.2 The Assistant Collector after due adjudication in his order-in-original No. 12/AC/VAL/CH/87, dated 2-11-1987 has held as follows in respect of the various deductions as mentioned above :-

(I) Deduction at the rate of 10% of duty actually paid or payable to the department is only permissible. Deduction at the, rate of 20% is not permissible.

(II) It has been held that Wooden packing for electronic typewriter manufactured by the appellant is essential for making them marketable and the assessee had not produced any evidence that the said wooden packing was actually returnable as per the sale agreement. It has also been held that typewriters are normally being sold in wooden packing. Hence deduction not permissible.

(III) Daizy Wheel, Carbon Ribbon and Correction Tape are essential components of an electronic typewriter. It has also been held that these articles are being supplied with the electronic typewriters. Hence the deduction is not permissible.

(IV) Installation Charges

This deduction is also held impermissible inasmuch as the price is for delivery at the factory gate or at the Branch Office and no installation expenses are incurred by the assessee at that point or place. Further, electronic typewriters (ETW) do not require any specific installation. These charges are in the nature of 'after sale services' incurred to promote the marketability of the goods and therefore, deduction is not permissible in view of Supreme Court's judgment in the case of Bombay Tyres International Ltd. - 1983 (14) E.L.T. 1896 (SC). In other words, he has upheld the allegations in the show cause notice in this respect.

(V) Freight on average basis

The Assistant Collector has allowed deduction subject to production of evidence in this regard and subject to its verification by the Range Superintendent in view of the well settled position in the case of Bombay Tyres International Ltd.

1.3 The appellant thereafter, in so far as the approval of price list is concerned, went in appeal to the Collector of Central Excise (Appeals), New Delhi against the aforesaid order but he did not succeed. The Order-in-Appeal No. 839/CE/CHG/91, dated 30-5-1991 passed by the Collector of Central Excise (Appeals), Chandigarh has been challenged now before the Tribunal.

1.4 In the meantime, a show cause notice dt. 12-7-1989 was issued by the Additional Collector of Central Excise, Chandigarh alleging short payment of duty for the period 1-5-1986 to 31-12-1986 to the tune of Rs. 69,006.71 on account of the aforesaid deductions unilaterally claimed and given effect by the appellant herein. Break-up of the amount of Rs. 69,006.71 is as follows :-

(1) Rs. 59,738.76 is on account of deduction claimed @ 20% (Tariff rate of duty) instead of 10% actually paid or payable to the department in terms of the exemption notification.

(2) Rs. 1,483.09 is on account of collection of additional freight charges by the 'appellant from its buyers in respect of sales from its Delhi Office to the destination without any evidence of incurring such additional freight.

(3) Rs. 1,205.91 is on account of additional packing and installation charges.

(4) Rs. 4,801.57 on extra discounts passed on to the buyers