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2018 (11) TMI 1808 - AT - Central ExciseValuation of goods - Rolls for Rolling Mills and the scrap - amalgamation of M/s. B. B. Forging - Revenue was of the view that since the amalgamation has been made effective from 01/04/2001, the clearance of goods made to M/s. B. B. Forging (P) Ltd are required to be valued in terms of Rule 8, right from 01/04/2001 - HELD THAT:- The dispute is regarding another unit transfer of certain goods manufactured by the appellant and subsequently, cleared to B. B. Forging (P) Ltd. for the period from 01/04/2001. The Hon’ble High Court of Calcutta has approved the scheme of amalgamation of M/s. B. B. Forging (P) Ltd with the appellant through their order dated 28/08/2001. The scheme is effective from 01/04/2001 in terms of Section 4 of the Central Excise Act, 1944 read with Rule 8 of the Valuation Rules, 2000. The valuation of goods cleared from one unit to another belonging to the same manufacture is in the nature of captive consumption and the value is required to made in terms of Rule 8 ibid i.e. @ 115% of the actual production cost, as determined in terms of the CAS-4 standards prescribed. Since the scheme of amalgamation is effective from 01/04/2001, such valuation of goods is required to be adopted with effect from that that. The dispute is essentially for the period 01/04/2001 to 27/08/2001. At the time of clearance of goods, the amalgamation order of the Hon’ble High Court was not available to the appellant. Consequentially, the goods were cleared on commercial terms and the same cannot be considered as with quotation “Sale” within the meaning of Sale of Goods ACT, 1930. As neither of the two entities were aware about the order of the Hon’ble Calcutta High Court, which stood passed subsequently only on 28/08/2001 - the commercial transaction between the two parties during the above period, requirement of Section 4 ibid, cannot attract mischief of Rule 8 of Central Excise Valuation goods, 2000. There are no justification in upholding the differential duty demand made by the Lower Appellate Authority - appeal allowed - decided in favor of appellant.
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