Notional Cost Of Maruti's Free Designs Supplied To Vendors Not Dutiable Under Central Excise: CESTAT

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has ruled that the notional cost of Maruti's free designs supplied to vendors is not dutiable under Central Excise. This significant decision provides relief to manufacturers who provide designs or technical know-how to their vendors for free, as part of a collaborative manufacturing process. The court clarified that such notional value, not involving actual consideration or sale, does not attract excise duty. This ruling promotes efficiency in manufacturing ecosystems, ensuring that collaborative design efforts with vendors do not incur additional tax burdens, and supporting the broader supply chain.