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2018 (6) TMI 175 - CESTAT CHANDIGARHValuation - apportionment/amortization of costs - apportioning the cost of patterns to assessable value of castings made from patterns - captive consumption of tools for which tooling costs received - CBEC in Circular dt. 23.01.1996 - Department alleged that the element of cost of tooling had not been included and apportioned in the assessable value of their final products - Held that:- The issue of apportioning the cost of patterns to assessable value of castings made from patterns was considered by CBEC in Circular dt. 23.01.1996, where it was laid down that the proportionate cost of pattern has to be included in the assessable value of the casting even in cases, where such patterns are being supplied by the buyers of the casting or are got prepared/manufactured by the job workers at the cost of the buyer. The issue of apportionment of the cost of moulds and dies, where the use of moulds and dies is spread over long period was dealt by this Tribunal in the case of Flex Industries Ltd. [1997 (1) TMI 173 - CEGAT, NEW DELHI], wherein this Tribunal after considering the aforesaid Board’s Circular dt. 23.01.1996 has held that the conclusion arrived at by the lower authorities that entire value of the cylinders is to be added to the value of printed pouches manufactured during the relevant period without reference to the expected life and capability of the cylinders has to be set aside and the matter has to be considered afresh by the respective adjudicating authorities. There is an element of surmise or presumption in the order of the Commissioner (Appeals), wherein he says that even they have not paid 50% of the duty in the above period of six years and on that basis, without testing the assertions made by appellants in their submissions and documentation before him, concludes that amortization was done incorrectly - the stand of the Commissioner (Appeals) that the appellants should have amortized the entire cost of tools by taking into account the ordered quantity of the goods appears to be fallacious. Appeal allowed - decided in favor of appellant.
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