Friday, 17 January 2014

CBEC circular with respect to the implementation of the decision in Fiat case


We are pleased to release a Tax Alert which gives an update on the recent Circular No. 979/03/2014-CX dated 15 January 2014, issued by the Central Board of Excise and Customs (CBEC), which clarifies certain issues with respect to the implementation of the Supreme Court decision in the Fiat India case.

It has been directed by the CBEC that the extended period of limitation of 5 years should not be invoked to reopen the cases where the show cause notice has been issued solely on the grounds of the Fiat judgment.

It has been further clarified that the judgment in the Fiat case cannot be applied in all cases where goods are sold at a price below the manufacturing cost and profit and due care must be taken at the level of the Commissioner to determine whether the facts of the case are similar to the Fiat case in order to apply the ratio of the decision.

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