News Flash
  • Last date for filing FORM GSTR-3B for December, 2017 extended till 22nd January, 2018.
  • “Decisions relating to Services in the 25th meeting of GST Council held at New Delhi on 18.01.2018 .” click here
  • Weekly newsletter from Chairman, CBEC dated 19/01/2018 click here
  • WCO Certificate of Merit Award, 2018 : List of Awardees click here
  • Decisions relating to Services in the 25th meeting of GST Council held at New Delhi on 18.01.2018click here
  • Letter to all CCs/DGs informing DGHRD Swachhta Whatapp Numberclick here
  • Reports on user Experienceclick here
  • Removing "Retired, but PPO not issued" figures reflecting on "Bhavishya" portal screenclick here
  • Chairman CBEC's weekly newsletter dated 13.01.2018click here
  • Cadre Restructuring and re-organisation of field formations under CBEC - Allocation of revised cadre strength.click here
  • Training of Officers on E-Way Bill System click here
  • Clarification regarding promotion of TA to the post of Executive Assistant (Erstwhile DOS/STA) and Executive Assistant to Inspector.click here
  • Clarification regarding promotion of Stenographer Grade-II in PB-I with GP-2400 (Erstwhile stenographer grade-III) to the post of Stenographer grade-I in PB-II with GP-4200 (Erstwhile Stenographer grade-II/Stenographer grade-I) and Stenographer grade-I in PB-II with GP-4200 (Erstwhile Stenographer grade-II/Stenographer grade-I) to the post of Inspector in PB-II with GP-4600.click here
  • Clarification on Letter F.No.A-32011/03/2015-Ad.III.A dated 23.02.2017 addressed to CC Chennai purportedly issued under the signature of the then US-Ad.III.A conducting DPC for promotion to the grade of Inspector.click here
  • Swachhta Pakhwada to be observed from 16.01.2018 to 31.01.2018click here
  • Updated version of GST Concept and Status and PPT on GST have been uploaded.
  • One day Training Of Officers from CBEC on E-way Bill System on 12 th January 2018 at NACIN ZTI Bangalore and 18 th January 2018 at NACIN Faridabad click here
  • A compilation of 51 GST Flyers has been uploaded on the CBEC website. For details please click here
  • Details of Vendors providing E-seals to exportersclick here
  • Meeting notice - meeting to be held on 17.01.2018 under Chairmanship of Member(Admin), CBEC in DGHRD with officials of recognised Associations/Federation under CBEC click here
  • Delhi Customs holding AEO Camp on 15th and 30th January at New Custom House, ICD Tughlakabad and ICD Patparganj to help filling/facilitating applications for AEO. click here
  • Letter issued to all Cadre Controlling Authorities/Directors General under CBEC regarding irregularities in promotions in respect of Group 'B' & 'C' Non-Gazetted Cadres in CBEC.click here
  • COMMENTS/SUGGESTIONS ON DRAFT TRANSFER & PLACEMENT GUIDELINES FOR IRS(C&CE) OFFICERS TO BE SEND BY 10.01.2018.click here
  • Filling up the posts of Group 'C' Non- Gazetted in Marine Wing of Commissioner of Customs (Preventive), Bhubaneshwar
  • Clarifications on promotion of stenographer Grade-I to the post of Inspectorsclick here
  • Clarifications on promotion for Gp B & C postclick here
  • Two days Refresher Training course on “Goods & Service Tax” for the officers of the rank of Assistant/Deputy/Joint/Additional Commissioners/Commissioners/Pr.Commissioners of CBEC on 22rd and 23rd January 2018– regclick here
  • CGST Rules, 2017 as amended upto 30/12/2017.click here
  • One day Training on “Right to Information Act, 2005” for officers of the rank of Assistant/Deputy/Joint/Additional Commissioners/Commissioners & above of CBEC on 05th Feb, 2018.click here
  • Notifications issued for extending the time limit for FORM GSTR-1, reducing late fee for delayed filing of FORM GSTR-4, appointing date for notifying e-way bill rules and amending the CGST Rules. and Circular issued on Filing of returns under GST
  • Marks Declared: Marks of Deptt. Exam. for Inspectors of C.EX. held in 01.08.2017 to 04.08.2017 declared. Nodal Officer may download marks from www.nacenkanpur.gov.in alongwith forwarding letter.
  • Appointment of nodal officer for acting as a single point contact with DGGST, New Delhi.click here
  • Circulars clarifying procedures under GST and Order extending filing of FORM GST CMP-03 are issued.
  • Notifications issued for extending the time limit for furnishing certain FORMS and amending the CGST Rules
  • Observation of Swachhta Pakhwada from 16.01.2018 to 31.01.2018click here
  • "Congratulations to DG Systems for receiving the Digital India Excellence Award-2017, under the category Citizen Services for the Express Cargo Clearance System, during PAN-IIM World Management Conference 2017."
  • Feedback requested on user-experience of GST applicationclick here
  • Compendium for AIOs, Printer and Saving files from Citrix Applicationclick here
  • Features available in GST application- Advisory dated 07.12.2017click here
  • Draft transfer & placement guidelines for irs(c&ce) officersclick here
  • Weekly newsletter from Chairman, CBEC dated 15/12/2017click here
  • Conduct of Departmental Examination for Confirmation of Direct Recruit Tax Assistants for the year 2017-18click here
  • Revised guidelines for purchase of laptop by CBEC officersclick here
  • Members Letter- Instructions on security, safety and upkeep of LANWAN infrastructureclick here
  • DRI’s mission against black money continues – demonetised currencies of face value of Rs 48.91 Crore recovered by DRI in Gujrat.
  • Nationwide Campaign under "Swachhta Hi Sewa"click here
  • Anti-profiteering Mechanismclick here
  • Format for filing anti-profiteering application.click here
  • CBEC congratulates the officers and staff of DRI on completion of 60 glorious years today. The diamond jubilee celebrations are being held today with Hon'ble Finance Minister as the chief guest
  • Departmental Examination for promotion of Ministerial Officers to be held from 14.02.2018 to 16.02.2018
  • One time relaxation in existing RRs for the post of Inspector and Executive Assistant under CBEC   click here
  • Comments are inviting on "Know Your Customer (KYC) norms" click here
  • Customs Broker License written examination under CBLR, 2013 to be held on 19.01.2018click here
  • All CC Zones/DGSTI are requested to transfer the legacy data from Pre GST Commissionerates to Post GST Commissionerates under PMM module.
  • CGST rates for Goods under different Notifications as amended from time to timeclick here
  • Letters regarding delivery and upgradation of IT infrastructure
  • Letter regarding requirement of IT infrastructure at Customs formationsclick here
View all

Section 37B ORDER No. 59/1/2003-CX

F.No.6/6/2003-CX.I
Government of India
Ministry of Finance & Company affairs
Department of Revenue
Central Board of Excise & Customs

3rd March, 2003.

37B ORDER No. 59/1/2003-CX

Subject:- Inclusion of freight and insurance charges in the assessable value.

            In exercise of the powers conferred under Section 37B of the Central Excise Act, 1944, Central Board of Excise and Customs considers it necessary, for the purpose of uniformity in connection with valuation of excisable goods to issue the following instructions.

2.         Attention is invited to CBEC"s Circular No.533/29/2000-Cx dated 24.5.2000 regarding Central Excise Valuation - amended definition of "place of removal" decision of CEGAT.

3.         The said Circular had been issued with reference to CEGAT"s Order No.1222/99A dated 24.08.99 in case of M/s.Escorts JCB Limited vs. CCE, New Delhi. The said judgment of Tribunal was appealed against (CA No.7230/1999) by the assessee before the Hon"ble Supreme Court. Supreme Court have, vide its Order in Civil Appeal No.7230 of 1999 and C.A.No.1163 of 2000 reported in 2002(146)ELT31(SC) decided the issue on 24.10.2002 setting aside the order of Tribunal.

4.         While giving the judgment the Hon"ble bench of Supreme Court have observed (in para 13 of the said judgment) that

"in view of the discussions held above in our view the Commissioner of Central Excise and CEGAT erred in drawing an inference that the ownership in the property continued to be retained by the assessee till it was delivered to the buyer for the reason that the assessee had arranged for the transport and transit insurance. Such a conclusion is not sustainable".

        In this judgement Hon"ble Supreme Court also quoted section 39 of "Sales of Goods Act, 1930" and held that the machinery, handed over to the carrier/ transporter is as good as delivery to the buyer in term of section 39 of the Sales of Goods Act, apart from terms and conditions of sale .

5.         Similarly in Civil Appeal No.4808-4809 of 2000 with C.A.No.1858-1859 of 2001, 7898 of 2001 and 4221 of 2002 against the order of Tribunal in case of Prabhat Zarda Factory Limited Vs. Commissioner of Central Excise reported vide 2000(119)ELT191(T-LB), the Hon"ble Supreme Court have in their order reported vide 2002(146)ELT497(SC) held, on 14.11.2002, that :

"In these matters, the question is whether freight and insurance charges are to be included in the assessable value for the purposes of excise. This question is covered by the judgment of this Court in the case of Escort JCB Ltd. vs. Commissioner of Central Excise, Delhi 2002 (146)ELT31(SC). The only difference which has been pointed out is that in the case of Escorts case (Supra) the sale was at the factory gate whereas in this case the sale was from the depot. Learned Counsel for the appellants admit that the freight and insurance charges upto the Depot would be includible in the assessable value for the purposes of excise. However, the sale being at the Depot, the freight and insurance for delivery to the customers from the Depot would not be so includible as per the said judgment."

6.         The Central Board of Excise and Customs have in consultation with Additional Solicitor General, decided not to file review petition against the said Supreme Court judgements.

7.         "Assessable value" is to be determined at the "place of removal". Prior to 1.7.2000, "place of removal" [section 4 (4)(b)-sub clauses (i), (ii) and (iii)], was the factory gate, warehouse or the depot or any other premises from where the goods were to be sold. Though the definition of "place of removal" was amended with effect from 1.7.2000, the point of determination of the assessable value under section 4 remained substantially the same. Section 4 (3)(c)(i)[as on 1.7.2000] was identical to the earlier provision contained in section 4(4)(b)(i), section 4 (3)(c)(ii) was identical to the earlier provision in section 4(4)(b)(ii) and rule 7 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000, took care of the situation covered by the earlier section 4(4)(b)(iii). In the Finance Bill, 2003 (clause 128), the definition "place of removal" is proposed to be restored, through amendment of section 4 to the position as it existed just prior to 1.7.2000.

8.         Thus, it would be essential in each case of removal of excisable goods to determine the point of "sale". As per the above two Apex Court decisions this will depend on the terms (or conditions of contract) of the sale. The 'insurance' of the goods during transit will, however, not be the sole consideration to decide the ownership or the point of sale of the goods.

9.         Based on the above clarifications, pending cases may be disposed off. Past instructions, circulars and orders of the Board on the issue may be considered as suitably modified.

10.         Suitable Trade Notice may be issued for the information and guidance of the trade.

11.         Receipt of this Order may please be acknowledged.

12.         Hindi version will follow.

Suraksha Katiyar
Under Secretary to the Govt. of India.