1. Excise duty dispute — Determination of whether duty was passed on to purchasers based on invoice endorsements. (Para 1 )
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1997 Supreme(SC) 999
SUPREME COURT OF INDIA
J.S.Verma, CJI., B.N. Kirpa, J.
SOUTH INDIA ALLOY INDUSTRIES, APPELLANT;
VERSUS
COLLECTOR OF CENTRAL EXCISE, RESPONDENT.
Civil Appeal No. 4198 of 1986, decided on July 24, 1997.
Important Points
The onus is on the taxpayer to prove that excise duty was not passed on to the purchaser if some invoices indicate the price is inclusive of duty; otherwise, it is presumed that the duty was passed on in all transactions.
Subject
Tax Law - Central Excise
Act Referred
CENTRAL EXCISE AND SALT ACT: S.11(b)(1)
Headnote
(A) Central Excise - Passing on of excise duty - Onus of proof - Where some invoices recovered show a specific endorsement that the price charged was inclusive of excise duty and the appellant fails to explain this or provide evidence that other invoices were different, it must be assumed that the excise duty was passed on to the purchaser in every transaction - Appellant not entitled to relief. (Para 1)
Facts of the case:
In some of the invoices recovered, there was a specific endorsement that the price charged by the appellant was inclusive of the excise duty. The appellant contended that there was no evidence that the position was the same in every invoice.
Findings of Court:
The appellant failed to show that other invoices showed a price which was different and that such price did not include the excise duty.
Issues: Whether the appellant could claim relief when it failed to discharge the onus of proving that excise duty was not passed on to the purchasers in all transactions.
Ratio Decidendi: The onus is on the appellant to demonstrate that the price in invoices did not include excise duty if some invoices specifically indicate that the price is inclusive of duty. In the absence of such evidence, it is assumed that the duty was passed on in every transaction.
Result: Appeal dismissed.
Facts of the case:
In some of the invoices recovered, there was a specific endorsement that the price charged by the appellant was inclusive of the excise duty. The appellant contended that there was no evidence that the position was the same in every invoice.
Findings of Court:
The appellant failed to show that other invoices showed a price which was different and that such price did not include the excise duty.
Issues: Whether the appellant could claim relief when it failed to discharge the onus of proving that excise duty was not passed on to the purchasers in all transactions.
Ratio Decidendi: The onus is on the appellant to demonstrate that the price in invoices did not include excise duty if some invoices specifically indicate that the price is inclusive of duty. In the absence of such evidence, it is assumed that the duty was passed on in every transaction.
Result: Appeal dismissed.
Legal Category Hierarchy
Table of Contents
2. Appellant contended that the inclusive of excise duty endorsement was not present in every invoice. (Para 1 )
3. Appellant failed to provide evidence that other invoices differed from those explicitly stating prices were inclusive of excise duty. (Para 1 )
4. Failure to prove that invoices showed prices excluding excise duty leads to the assumption that duty was passed on in all transactions. (Para 1 )
5. What is the evidentiary requirement for an appellant to prove excise duty was not passed on to purchasers?
The appellant bears the onus to show that invoices showed a price different from those inclusive of excise duty; otherwise, it is assumed the duty was passed on in every transaction. (Para 1 )
ORDER
1. From the Tribunals order, it is clear that in some of the invoices recovered there was a specific endorsement that the price charged by the appellant was inclusive of the excise duty. There is no explanation by the appellant of this fact. Learned counsel for the appellant submitted that there is no evidence that in every invoice the position was the same. It is sufficient to say that the onus was on the appellant to show that the other invoices showed a price which was different and that price did not include the excise duty. In the absence of any such effort made by the appellant, it has to be assumed that the appellant had passed on the excise duty in every transaction to the purchaser. This being so, for this reason alone the appellant is not entitled to the relief claimed.
2, The appeal is dismissed.
