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2023 (6) TMI 456 - AT - Central ExciseValuation - Nylon Chips, & Pet chips - value determined under Section 4(1)(b) of Central Excise Act, 1944 read with Rule 8 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - appellant discharged excise duty claiming 9.5% discount from per unit cost of production of nylon chips & Pet Chips determined in CAS-4 issued by Cost Accountant towards the weight of moisture contained in the nylon chips& PET chips so as to arrive at the value of wet nylon chips cleared to its sister units - revenue neutrality - time limitation. HELD THAT:- For the year 2009-10 & 2010-11, it is found that there is a specific mention of the discount of 9.5% in the CAS-4 certificate itself and net cost of production of wet chips has been arrived at after arriving at the cost of production of the dry chips and discounting the cost by 9.5% to arrive at the cost of dry chips. The appellant has cleared their goods by taking this cost only for determining the assessable value. No evidence has been adduced by the department that the Nylon & polyester chips cleared by the appellant to its sister units was not the wet chips. This fact has also been certified by the Chartered Engineer in its report dated 10.05.2012 that the chips arising after the centrifugal stage in which these are cleared by the appellants has a moisture content of 9-13%. The report of the Chartered Engineer has not been contradicted in the impugned order. It is found that the impugned order has mechanically been passed and the demand has been confirmed for these years 2009-10 & 2010-11 without any discussion in the impugned order to the CAS-4 certificates for these years and only CAS-4 certificates for the years 2007-08 and 2008-09 have been discussed in the impugned order. Therefore, there was absolutely no reason for the adjudicating authority to confirm demand for the year 2009-10 & 2010-11. For the years 2007-08 & 2008-09 we find that the CAS-4 certificates originally prepared by the Cost Accountant did not have any mention whether the cost of production arrived at was for the dry chips or the wet chips. However, the appellant in order to justify their contention that the cost of production determined in the CAS-4 certificates for these years was only for the dry chips, produced another certificate from the Cost Accountant for the years 2007-08 & 2008-09 which categorically mentioned that the cost shown in the earlier CAS-4 certificates was for the dry chips only and the average moisture content in the wet chips was 9.32% and 9.40 percent respectively for the years 2007-08 & 2008-09. The certificate issued by KAILASH SANKLECHA & ASSOCIATES, COST ACCOUTANTS, clearly states that the certificate has been issued by the Cost Accountant after checking cost records, excise records, production records and other related records of the appellant. It is a settled principle of law that the certificates issued by qualified professionals like Cost Accountants, Chartered Accountants, Chartered Engineers should not be brushed aside merely with the statement that corroborative evidence was not produced. They need to be accepted by the department unless investigation is undertaken in doubtful cases and the data is re-verified by appointing its own cost accountant or producing another material on record. The original Cost Accountant CAS-4 certificates determined cost of the dry chips only and the appellant was entitled to discount the moisture percentage to arrive at the net cost of production. However, it is seen that the discount of 9.5% claimed by the appellant was marginally higher than the wet content of 9.32% or 9.40% arrived at by the Cost Accountant for the years 2007-08 & 2008-09 respectively. Time Limitation - revenue neutrality - HELD THAT:- As the whole issue was revenue neutral as any additional duty payable by the appellant was available for Cenvat credit to its sister unit, no malafide can be attributed for this small difference. As the demand, if any, for this small difference will be for the years 2007-08 & 2008-09 only and the show cause notice was issued on 17.03.2012, the demand will be time barred. The impugned order set aside on merit as well as on limitation - appeal allowed.
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