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2018 (10) TMI 264 - AT - Central ExciseValuation - Job-work - processing of Grey Fabrics manufactured and supplied by Ms GSML - Related person or not? - third proviso to Section 4(1)(a) of Central Excise Act - demand of differential duties on the value of difference between sale price to the “related person” and the value adopted by Appellant at the time of clearance of goods. Held that:- It appears that the OIA dated 18.09.2003, in as much as it relates to the Appellant has attained finality and the findings made therein cannot be interfered with. The Revenue by not filing an appeal against the said OIA dated 18.09.2003 against the Appellant has not contested the findings made by the Commissioner (Appeals) and hence the demand of ₹ 24,154,40/- against the Appellant cannot be allowed to be sustained - the Revenue has no ground to make demand of aforesaid amount against the Appellant. Demand of ₹ 6031775.30 raised against the Appellant vide Show Cause Notice dated 12.05.1998 - The Revenue’s case is that the Appellant and M/s SPL are related persons and has under-valued the goods manufactured by them and supplied to each other by paying excise duty on cost construction method, i.e. by adding landed cost of raw material and job work charges - Held that:- It is not a disputed fact that the Appellant and M/s SPL have sold the similar excisable goods to other independent buyers. In such case, when the other buyers of the similar goods are available, the assessable value cannot be determined in terms of Section 4(1)(a) as the same is applicable only when the goods are sold only through related persons, which is not the case here. Even if the demands are to be made the same should have been computed by taking assessable value of the goods to the nearest ascertainable equivalent value thereof determined in such manner, as may be prescribed - Since there is no major difference between the goods sold to independent buyers and allegedly related person M/s SPL and the prices are comparable after taking into consideration the discount and other expenses, we do not find any reason to demand duty from the Appellant. The discounts by the Appellant to M/s SPL are normal business transaction as has been upheld by the Tribunal in various judgments in the case of CCE Vs. Indian Turpentine & Resin Co. Ltd [1987 (2) TMI 334 - CEGAT, NEW DELHI] - the demands raised against the Appellant does not sustain and are set aside. Time Limitation - Held that:- In the case of Show Cause Notice dt 12.05.1998, the period involved is April 1993 to March 1998 and the Appellants were under bona-fide belief that in case of job work, the concept of related persons is not applicable and the value has to be determined as per Hon’ble Supreme Court judgment in the case of Ujagar Prints [1989 (1) TMI 124 - SUPREME COURT OF INDIA]. Thus, the Appellant had bona-fide belief for valuation of goods manufactured under job work. The demands beyond normal period of limitation are thus held to be patently time barred. Demand set aside - appeal allowed - decided in favor of appellant.
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