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2009 (3) TMI 391 - AT - Central ExciseValuation – DTA clearance by EOU – transaction value rejected as nature of goods misdeclared – related persons – department proceeding on basis of Rule 7 of Custom (Valuation) Rules, 1988 - Department’s submission is that goods are not rejects but are prime quality goods – huge difference between the figures of rejects mentioned in the statutory records and the actual quantity of rejects - This is a clear evidence of inflating the figure of rejects for which the Appellants have not given any explanation. – Goods are not rejects and hence not eligible for Notification no. 2/95-C.E. – Held that transaction value rejectable without going into question of related person – Further, DTA sales cannot be treated on par with export sales to countries – Hence value is to be determined under Rule 7 by deductive method - it is Rule 7 which has to be tried first instead of jumping straightway to Rule 8 and recourse can be taken to Rule 8 only when the value cannot be determined under Rule 7 or Rule 7A. We are also of the view that the Board’s Circular No. 268/85-CX-6 dated 29-9-94 read with the earlier Circular No. 23/84-CX-8 dated 29-5-84, providing for determination of the assessable value in such cases by taking recourse to Rule 8 on the basis of the FOB price of the identical or similar goods is not in accordance with the provisions of sub-rule (2) of Rule 8 - Extended period under proviso to Section 11A(1) of the Central Excise Act, 1944 is available to the Department in respect of both the show cause notices for the recovery of the short paid duty - While UTL are liable for penalty under Section 11AC of Central Excise Act, other noticees are liable for penalty under Rule 209A of the erstwhile Central Excise Rules, 1944/Rule 26 of the Central Excise Rules 2001-02; - Second SCN on same facts but for different priod – SCN issued reportedly for later period only because of delay on part of assessee - We are of the view that extended period is applicable even for the second show cause notice.
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