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2022 (10) TMI 1244 - CESTAT MUMBAIQuantification of demand - Valuation of excisable goods manufactured - valued lower than the cost of production and profit of the goods - Section 4(1) (a) of the Central Excise Act, 1944 - recovery of short paid duty with interest and penalty - HELD THAT:- From the perusal of the report of the cost auditors it is evident that there are few instances wherein the goods specially “Palio” model cars were being cleared on transaction value which was lower than the cost of production. It was clarified by the appellant that the said model was being phased out. Commissioner has rejected the said argument, ignoring the factual report contained in the cost auditor report there is no sale of the said car during the Financial 2012-13, and thereafter. It is found that the ratio at which the cost of production of Palio cars has increased over the years is much higher than the ratio for the other Fiat Car models manufactured by the assessee. With no evidence of any plan to stop production and selling of Palio brand cars from 2008 onwards itself being on record, the above analysis clearly implies that in the case of Palio models, the assessee failed to bring down the cost of production and hence resorted to selling the cars below the cost of production to penetrate the segment - when production and clearance show such sharp decline, rejection of the submission to this effect that this was being phased out cannot be justified. In the present case it is not even the case of revenue that any additional consideration over the price charged for the actual sale of goods was received by the appellant from the buyer of goods in any manner directly or indirectly. That being so, there are no hesitation in holding that the transaction value is to be accepted for determination of the duty liability in respect of the goods cleared by the appellant, and the amendment made in the rule 6 in 2014 is only clarifying. There are no merits in the grounds for confirmation of demand against the appellant we are not taking the other issues of limitation, demand of interest and imposition of penalty for discussion. The impugned order set aside - appeal allowed.
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