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2015 (10) TMI 1845 - GUJARAT HIGH COURTWrit petition - Valuation - related person - Short payment of duty - revenue neutral exercise since the recipient is able to avail Cenvat Credit - Appellant contended that order passed by the Appellate Commissioner is a non speaking one to the extent it has not considered and dealt with the most important contentions raised before it - Held that:- in the absence of any reasons having been assigned for not accepting the principal contention raised by the petitioner, it is evident that the impugned order suffers from the vice of breach of principles of natural justice. It is settled legal position as held by the Supreme Court in the case of Whirlpool Corporation v. Registrar of Trade Marks, Mumbai, [1998 (10) TMI 510 - SUPREME COURT], that the alternative remedy has been consistently held by the Supreme Court not to operate as a bar in at least three contingencies, viz. where the writ petition has been filed for the enforcement of any of the fundamental rights or where there has been a violation of the principles of natural justice or where the order of proceedings are wholly without jurisdiction or the vires of an Act is challenged. The present case, therefore, clearly falls within the categories enumerated in the above decision viz. violation of the principles of natural justice. - writ petition admitted. Thus, under rule 8 of the Valuation Rules if the assessee does not sell excisable goods but such goods are used for his own consumption or on his behalf in the production or manufacture of other articles, the value of such goods shall be 110% of the cost of production or manufacture of such goods. Under rule 9 of the Valuation Rules, when the arrangement of assessee is such that the excisable goods are not sold by it except through a related person, the value of the goods shall be the normal transaction value at which they are sold by the related person at the time of removal to buyers (not being related person) or where such goods are not sold to such buyers, to buyers (being related person), who sells the goods in retail. Appellate Commissioner has lost sight of the main contention raised by the petitioner that it is not liable to pay duty either under rule 8 or rule 9 of the Valuation Rules, because the related party has already paid central excise duty on the transaction value of the goods sold by it. The facts reveal that the petitioner had made reference to rule 8 of the Valuation Rules only by way of an alternate submission and the controversy was not as to which of the two rules would apply. The petitioner has also produced before the concerned authorities, documentary evidence to co-relate the sales made by the petitioner to VCL at which point of time, central excise duty was paid on the transaction value, which however, have not been considered by either authority. Therefore, as rightly submitted by the learned counsel for the petitioner, the impugned orders suffer from the infirmity of being nonreasoned orders as the same do not deal with the main contention raised by the petitioner. Since the requirement to record reasons emanates from the broad doctrine of fairness in decision making, the said requirement is now virtually a component of human rights. Thus, giving sufficient reasons to demonstrate that the relevant factors having considered objectively is a primary requirement to be satisfied by a judicial or quasi judicial authority. The requirement of reasons has been considered to be virtually a component of human rights. Under the circumstances, the impugned orders, which suffer from the basic infirmity of being non-reasoned orders inasmuch as both, the adjudicating authority as well as the Appellate Commissioner have failed to consider the relevant factors and the submissions advanced by the petitioner, cannot be sustained. - Impugned order is set aside - Matter remanded back - Decided in favour of assessee.
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