COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS, BANGALORE versus M/S JSW STEEL LTD. (FORMERLY KNOWN AS JINDAL VIJAYANAGAR STEEL LTD.)

Citation: [2019] 6 S.C.R. 938 · Decided: 09-04-2019 · Supreme Court of India · Bench: S.A. BOBDE · Disposal: Dismissed
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Judgment (excerpt)

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SUPREME COURT REPORTS
[2019] 6 S.C.R.
COMMISSIONER OF CENTRAL EXCISE AND
      CUSTOMS, BANGALORE
 v.
M/S  JSW STEEL LTD.
(FORMERLY KNOWN AS JINDAL VIJAYANAGAR
STEEL LTD.)
(Civil  Appeal No.531 of 2008)
APRIL 09, 2019
[S.A. BOBDE, DEEPAK GUPTA AND VINEET SARAN, JJ.]
Central Excise Act, 1944 – ss.4 and 11AB – Respondent
manufactured Pig Iron and HR Coil Sheets, falling under Chapter
72, 1985 Act – While selling the goods, invoices were raised on the
price of goods plus ‘Dharmada’, a charitable donation from
customers, which was credited to charity – Show cause notice issued
by the Deputy Commissioner, Central Excise and Customs, Bellary
calling upon the Respondent to show cause as to why penalty
u/r.25, 2002 Rules and interest u/s.11AB, 1944 Act be not levied –
Deputy Commissioner held that the Dharmada is to be added to the
assessable value for the payment of central excise duty –
Commissioner (Appeals) confirmed the order – CESTAT set aside
the order – On appeal, held: Present case has been tagged with
M/s. D.J. Malpani vs. Commissioner of Central Excise, Nashik, [2019]
6 SCR 925 wherein it was held that the amount of Dharmada cannot
be included in the transaction value for the purposes of assessments
– In view of the said judgment, the present appeal is dismissed –
Central Excise Rules, 2002 – r.25 – Central Excise Tariff Act, 1985
– Chapter 72.
Dismissing the appeal, the Court
HELD: 1.1 The present case has been tagged with the case
of M/s D.J. Malpani vs. Commissioner of Central Excise, Nashik
which was referred to this Bench vide order dated 29.07.2015. It
was held that the amount of Dharmada cannot be included in the
transaction value for the purposes of assessments. In view of the
judgment in the case of Civil Appeal No. 5282 of 2005, M/s D.J.
Malpani vs. Commissioner of Central Excise, Nashik, the present
appeal is dismissed. [Paras 5, 6][940-D-E]
[2019] 6 S.C.R. 938
  938
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M/s D.J. Malpani vs. Commissioner of Central Excise,
Nashik [2019] 6 SCR 925 – relied on.
Collector v. Panchmukhi Engineering Works (2003)
(158) ELT 550 (SC) – referred to.
Case Law Reference
[2019] 6 SCR 925
relied on
Para 6
(2003) (158) ELT 550 (SC)
referred to
Para 4
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 531 of
2008.
From the Judgment and Order No. 440/2007 dated 04.4.2007 of
the Customs, Excise and Service Tax Appellate Tribunal, South Zonal
Bench, Bangalore in Appeal No. E/395/2005.
K. Radhakrishnan,  S. K. Bagaria,  Sr. Advs., Alok Yadav,
K. Ajit Singh, Praveen Kumar, Ms. Nisha Bagchi, Ms. Aruna Gupta,
B. Krishna Prasad,  U. A. Rana, Himanshu Mehta,(for M/s. Gagrat and
Co,)  Advs. for the appearing parties.
The Judgment of the Court was delivered by
S.A. BOBDE, J.  1. The Revenue-Appellant has come in appeal
against the order of the Central Excise and Service Tax Appellant Tribunal
(for short “CESTAT”) dated 04.04.2007. The Respondent manufactured
goods falling under Chapter 72 of The Central Excise Tariff Act, 1985.
The Respondent manufactured Pig Iron and HR Coil Sheets. While selling
the goods they raised invoices on the price of goods plus ‘Dharmada’ a
charitable donation from customers. According to the Respondent, the
Dharmada was meant for charity and was accordingly credited to charity.
2. However, show cause notice dated 19.03.2004 was issued by
the office of the Deputy Commissioner of Central Excise and Customs,
Bellary under Section 4 of the Act calling upon the Respondent to show
cause as to why penalty under Rule 25 of Central Excise Rules, 2002
and interest under Section 11AB of the Central Excise Act, 1944 should
not be levied. After hearing the Respondent, the Deputy Commissioner
vide order dated 10.09.2004 held that the Dharmada is to be added to
the assessable value for the payment of central excise duty.
3. Thereafter, in an appeal filed by the Respondent, the
Commissioner (Appeals), confirmed the decision of the Deputy
COMMIR.. OF CENTRAL EXCISE AND  CUSTOMS,
BANGALORE v. M/S  JSW STEEL LTD.
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Commissioner and rejected the appeal and held that Dharmada should
be added to the assessable value. Therefore, the goods were liable to be
assessed on the basis of their price plus Dharmada.
The CESTAT in an appeal filed by the Respondent, by judgement
dated 04.04.2007, allowed the appeal and set aside the order passed by
Commissioner (Appeals) dated 29.03.2005.  The CESTAT purported to
follow its judgment in the case of
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