Valuation -re-treading of tyres - whether' sale' includes' deemed sale

 

Laxmi Tyres vs. Commissioner of center Excies, Pune - 2013 –TIOL -1261-MUM

Facts:

The Appellant was engaged in retreading of tyresand thus claimed the benefit of Notification NO.12/2003-ST dated20-06-2003 by deducting approximately 70%as material cost on which sales tax/VAT was paid and service tax was paid only on30% of the remaining value.

Relying on Aggarwal Colour Advance Photo System 2011-TIOL-1208-CESTAT-DEL-LwBhich stated that the term 'sold' appearing in the said notification was to be in interpreted using the definitionof' sale' in the CentralExcise Act, 1944 and not as per the meaning of deemed sale under Article 366(29A) (b)of the Constitution. The department contented that tax was payable on the entire amount.

Held:

Perusing the sample invoice issued by the appellant and relying on the larger Bench'sdecision in AggarwalColour Advance Photo System, the Hon. Tribunal disposed the appeal and held that the appellant was not eligible for the benefit of Notification No. 12/2003-ST and liable to discharge service tax liability on the gross amount charged for the said transaction.