Per Shri V.P. Gulati : By this application, the applicants have pleaded for dispensation of pre-deposit of duty of Rs. 4,03,603.42 demanded and a penalty of Rs. 50,000/- levied on the applicants in terms of the impugned order of the Collector of Central Excise, Bangalore.

2. Shri G. Chander Kumar, the learned Counsel for the applicants pleaded that duty has been demanded from the applicants for the reasons that the applicants had included the amount received by them towards tooling and development of the product which was ordered for by their buyers. He pleaded that initially a duty of Rs. 25,31,045 had been demanded from the applicants for the reasons that the applicants/appellants had received an amount of Rs. 18,55,000/- and Rs. 63,34,561 in the form of tool and die development charges during the year 1990-91 and 199192 respectively from the customers M/s Ashok Leyland Ltd, Madras and also interest accrued there from was not reckoned towards the assessable value. He pleaded that after the applicants had shown to the learned lower authority that this amount earlier received had been amortized by adding the portion of these charges on each pieces supplied by them after development, the Id. lower authority only confirmed the demand mentioned above rejecting the applicants' plea that this amount also had to be amortized and that in respect of the order to which the amount related only limited supplies had been made upto the point of detection of the case, holding that so far as the amount of Rs. 18,34,561 had been received as tooling cost for SOR 109 NX tandem axle against purchase order No. X91039, the applicants had not provided the details regarding the value claimed on prorata basis per piece sought to be amortized out of the amount received by them. The learned Counsel pointed out that so far as the applicants are concerned, against this particular order they had made only limited supplies and they had included in the price shown in the price list part of the amount deposited by way of amortization even though they had not shown it separately the amount being mortized per piece. In any case, he pleaded that even if it was held that the amortized amount had not been included since the applicants were making clearances in respect of the said particular order for which they had receive the amount as advance the duty could be demanded towards the clearance made against the said order so far and that would only warrant payment of Rs. 4,731 based on the amortized amount taking into consideration the total amount received and the number of pieces to be supplied against the order in question. In this connection the learned Counsel referred us to page 140 of the notebook showing the work sheet. He urged the learned lower authority had accepted the principle of amortization. He pleaded that this Tribunal in the case of the very same applicants/appellants in similar circumstances in respect of amount which had been received in bulk, and duty had been demanded, has held as under :

"It is not uncommon in the industry to collect certain development charges if a new product was to be developed and it has to be established that these development charges are relatable to the goods that are manufactured and cleared by the petitioner. In the present case, there is no finding in the order of the learned lower authority that the petitioner had manufactured and cleared any goods. There is also no mention as to value of the goods in question declared by the petitioner in the price list. No work out has also been done allocating the development charges towards the cost of the product manufactured by the petitioner. It appears that the lower authority has only gone by the amount collected and has not gone into the aspect of manufacture and clearance of goods by the petitioner and also the unit price of goods declared by the petitioner with reference to any price list filed and value of clearance on which the value addition is sought to be made.