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2010 (8) TMI 906 - AT - Central ExciseValuation - clearances of cotton yarn to their own unit - clearance for job-work - Rule 8 of the Central Excise Valuation Rules, 2000 - undervaluation - whether the value adopted by the appellant for the goods cleared on their own account and on job work basis based upon the Cost Accounting Standard-4 (CAS-4) is correct or the value which has been arrived by the cost audit report of the company should be adopted? - Held that: - rule comes into play when the goods are cleared for consumption to their own unit or on their behalf. Since it is undisputed that the processed yarn cleared from the appellant’s factory is consumed by their own sister concern, provisions of Rule 8 of the said rules will apply. The appellants have been submitting the cost certificates to the authorities. The said cost certificates were of the cost of production on the manufacture of such goods. Both the lower authority’s finding that the said CAS-4 certificates could not be computed for each consignment at the time of clearance, does not mean that the assessee is at liberty to remove the goods to a related person on an approximate value, seems to be incorrect as if it is undisputed that the processed yarn is consumed by the related/sister concern for further manufacturing of the goods, provisions of Rule 8 of the said rules would clearly apply. Since the cost certificates which were submitted by the assessee before the clearances of the goods from the factory are not disputed or challenged by the revenue authorities, it has to be accepted that they were correct cost of production. Revenue neutrality - Held that: - the duty paid on such processed yarn cleared by appellant is being taken as Cenvat credit, by their own sister concern. This fact is not disputed by the revenue. If that be so, then the question of revenue neutrality arises, as it is an admitted fact that the transaction is mostly between the sister units. If that be so, the demand of duty on the appellant would be of no consequence as it would be revenue neutral. Appeal allowed - decided in favor of appellant.
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