TMI Blog2001 (4) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... factory at Amritnagar a product, Bournvita. Cadbury India Ltd. (Cadbury for short) is the owner of the trademark of this product, stated to be a malted milk food. Cadbury supplied to Warana the raw material for manufacture of the product as also recipe for its manufacture. The employees of Cadbury were posted at the factory to supervise the receipt and handing over of the raw material and to test samples of finished product. Warana supplied the entire production of Bournvita to Cadbury, being paid an agreed change per kilogram as processing charges. Warana paid duty on the product on the cost of manufacture incurred by it. 3. By notice issued to Warana, the department proposed to treat the manufacturer of the product to be Cadbury, and to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... packaging other material used in manufacture. He finds this to be a normal feature cases of job works, particularly so in cases, such as foods, where it is essential to assure the quality of the product. He has cited an affidavit submitted by Warana, and a report by the Asstt. Collector that it was the job of the Cadbury personnel at Warana to ensure receipt thereof raw material and dispatch of finished product. He does not accept that the right of Cadbury as to reject substantive material amounts to control by it, particularly since such material is reprocessed. 5. The appeal does not question any of these conclusions. It contends that it is probable that Cadbury personnel posted at the Warana factory exercised overall supervisory contro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is of the judgment of Ujagar Prints, and not accepted that the value of identical cigarettes manufactured by India Tobacco Co. at its factory should apply. The Tribunal has also disapproved determination of the value of goods manufactured by a job-worker by applying the value of comparable goods by another manufacturer. It noted that Rule 6B(1) of the Valuation Rules, which directs adoption of value of comparable goods would only apply in a case where the excisable goods are not sold by the assessee but are used or consumed by him or on his behalf in the production or manufacture of another article, and held that this rule will not apply in situation where there is no such captive consumption. 7. The department s appeal is accordingly dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its owner. 10. Cadbury maintained a godown outside the Warana factory in which it stored the raw material which was to be supplied to Warana. The Collector has held the rent and other expenses incurred in maintaining this godown to be includible in the value. This is being challenged. It cannot be disputed that the cost of raw material should form part of the assessable value. Such cost, as the Supreme Court says, should be the cost of the raw material in the hands of the processor . It is not disputed that godown was being used solely for supply of raw material to Warana and for no other purpose. The costs incurred in running this godown are hence part of the cost of raw material supplied to Warana, and includible in the value of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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