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2024 (4) TMI 324 - AT - Central ExciseDenial of CENVAT Credit - recovery of the differential central excise duty - appellant has discharged appropriate duty on the body building activity on the duty paid chassis supplied free of cost by M/s ALL during the period 2006-07 & 2007-08 or not - entitlement to avail cenvat credit of the duty paid on the chassis supplied free by M/s ALL - Sl.No.41(1)(ii) of N/N. 6/2006-CE - Extended period of Limitation - HELD THAT:- It is found that from the very beginning of the proceeding, in their reply to the internal audit, the appellants have categorically submitted that they have not opted for the exemption under Notification No.6/2006-CE dated 01.3.2006, hence, not required to comply with the conditions prescribed under the said notification. They have informed that by availing cenvat credit on the duty paid chassis and after undertaking the activity of body building on the Chassis, which amounts to manufacture, they had cleared the Vehicle applying the normal tariff rate as applicable from time to time. The approach of the Department is fallacious from the very beginning. Assuming that the conditions of the notification 06/2006-CE have not been complied with, by availing CENVAT credit on the duty paid chassis, the appellant would not have been eligible to the benefit of the notification and the manufactured goods would be assessed in accordance with the normal provisions. Secondly, Explanation appended Sl.No.41(1)(ii) provides that the value of the manufactured vehicle shall be the value of the vehicle excluding the value of the chassis used in such vehicle, whereas, in the present case, the appellant has added the body building charges and the value of the chassis supplied free of cost in computing the assessable value for the purpose of payment of duty for the year 2006-07 and 2007-08; hence it is incorrect to allege that the appellant had availed the benefit of the said Notification - the appellants are entitled to avail cenvat credit on the duty paid chassis supplied free of cost by M/s. ALL to the appellant. Valuation and differential duty - HELD THAT:- The period involved in the present demand notice involves 2006-07 to 2007-08. Rule 10A has been inserted to the Central Excise Valuation Rules, 2000 w.e.f. 01/04/2007. Consequently, the valuation of the body built vehicles has to be arrived at following Rule 10A from 01/04/2007 by adopting the price at which the body built vehicles are sold by the supplier M/s. ALL. For the period prior to that, the valuation has to be carried out by adopting the formula laid down by the Hon’ble Supreme Court in UJAGAR PRINTS, ETC. ETC. VERSUS UNION OF INDIA AND OTHERS [1988 (11) TMI 106 - SUPREME COURT]. Time Limitation - HELD THAT:- The present demand is relating to differential duty on the recalculated assessable value as alleged by the Revenue. There are force in the contention of the learned advocate for the appellant as the appellant was following the method of computation of assessable value adopting the principle in Ujagar Print’s case and discharging duty by disclosing all the facts; hence invocation of extended period demanding differential duty on the redetermined value by the Revenue, in absence of suppression of facts or mis-declaration, cannot be sustained. Accordingly, the differential duty of Rs.9,51,837/- demanded for the period 2006-07 and 2007-08 is barred by limitation. The impugned order is set aside - Appeal allowed.
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