IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KOLKATA EASTERN ZONAL BENCH : KOLKATA REGIONAL BENCH - COURT NO.2 Excise Appeal No.604 of 2007 (Arising out of Order-in-Appeal No.58/CE(A)/GHY/07 dated 11.09.2007 passed by Commissioner, Customs & Central Excise (Appeals), Guwahati.)

M/s. Brahm India (P) Ltd.

(EPIP Industrial Estate Rajabagan, Byrnihat, Dist.-Ri-Bhoi, Meghalaya, Pin-793101.)

…Appellant VERSUS Commissioner, CGST & CX, Shillong …..Respondent (Crescens Building, M.G. Road, Shillong-793001.)

WITH Excise Appeal No.605 of 2007 (Arising out of Order-in-Appeal No.58/CE(A)/GHY/07 dated 11.09.2007 passed by Commissioner, Customs & Central Excise (Appeals), Guwahati.)

M/s. Khasi Alloys (P) Ltd.

(EPIP Industrial Estate Rajabagan, Byrnihat, Dist.-Ri-Bhoi, Meghalaya, Pin-793101.)

…Appellant VERSUS Commissioner, CGST & CX, Shillong …..Respondent (Crescens Building, M.G. Road, Shillong-793001.)

APPEARANCE NONE for the Appellant (s)

Shri P.Das, Authorized Representative for the Revenue CORAM: HON’BLE SHRI R. MURALIDHAR, MEMBER(JUDICIAL)

HON’BLE SHRI RAJEEV TANDON, MEMBER(TECHNICAL)

FINAL ORDER NO. 76677-76678/2025 DATE OF HEARING : 12.06.2025 DATE OF DECISION : 02.07.2025 Per : RAJEEV TANDON :

The appellant herein is a manufacturer of Ferro-Silicon falling under chapter sub-heading 7202 having its regd. Office and works at EPIP Industrial Estate Rajabagan, Byrnihat, Dist.-Ri-Bhoi, Meghalaya, Pin-793101 and is therefore availing the benefit of area based exemption Notification No.32/99-CE dated 08.07.1999.

2. Though none is present for the appellants, however, as the appeals are of the year 2007 concerning the period of November 2004 to September 2005, it is proposed to examine the present appeals with the help of the ld.AR for the Revenue.

3. The appellants are concerned with the sale of finished goods to different buyers on payment of appropriate central excise duty. While raising such invoices, it is noticed that the appellants do not separately charge for freight to the buyers and whatever freight charges were paid by the appellant is the selling and distribution expenses forming a part of the cost of the goods sold, for pricing of the goods sold to the buyers.

4. During the course of the audit, the department alleged that the appellant sold their finished goods including the cost of transportation charge causing over-valuation of the assessable value of the finished goods thereby contravening Section 4 of the Central Excise Act read with Rule 5 of the Central Excise Valuation (Determination of the Price of Excisable Goods) Rules, 2000 and Notification No.32/99-CE dated 08.07.1999. It is therefore the Revenue’s case that the appellant has taken excess refund of duty paid to an extent of Rs.4,63,599/- in terms of the said area based Notification.

5. Before the lower authorities, the appellant has however contested the aforesaid allegation of the Revenue. In this regard the learned adjudicating authority in its order has made the following observations:

―I find that the assessee has made a very tricky submission without directly acknowledging the fact that they have inflated the assessable value and for that matter transaction value by inclusion of cost of transportation in value for the purpose of assessment of Central Excise duty. The overall submission they made, makes its obvious of clear that expenditure, on freight outward under the head of indirect expenses have been incurred. They admitted in accordance with the agreement with its buyers the freight was paid and realized from those buyers having entered into the agreements. The cost of transportation was obviously reflected in the books of accounts as it has been actually spent and realized. But they argued that the freight has got othing to do with the duty of excise as it does not form a part of the value.‖

6. We find this finding to be the basis of the Order-in-Original, upholding the demand raised against the appellant. In appellate proceedings, the learned Commissioner(Ap