TMI Blog2012 (8) TMI 791X X X X Extracts X X X X X X X X Extracts X X X X ..... ice charged for the sale of cars is exceptional,it cannot be accepted to give a meaning which fit into the meaning of the expression 'ordinarily sold'. In other words, in the transaction under consideration, the goods are sold below the manufacturing cost and manufacturing profit. Therefore, such sales may be disregarded as not being done in the ordinary course of sale or trade. Thus as the assessees are not fulfilling the conditions enumerated in Section 4(1)(a) of the Act and therefore, the valuation has to be done in accordance with Section 4(1)(b). Under Section 4(1)(b) of the Act, 1944, any goods which do not fall within the ambit of Section 4(1)(a) i.e. if the 'normal price' cannot be ascertained because the goods are not sold or for any other reason, the 'normal price' would have to be determined in the prescribed manner i.e. prior to 1st day of July, 2000, in accordance with Rules, 1975 and after 1st day of July 2000, in accordance with Rules, 2000. A bare reading of the rules does not give any indication that the adjudging authority while computing the assessable value of the excisable goods, he had to follow the rules sequentially. The rules only provides for arrivi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 6.4.1998. Thereafter, M/s Ind Auto Ltd. (now M/s Fiat India Ltd.) carried on the said business after obtaining fresh central excise registration. The assessees have filed several price declarations in terms of Rule 173C of the Central Excise Rules, 1944 (hereinafter referred to as 'the 1944 Rules') declaring wholesale price of their cars for sale through whole sale depots during the period commencing from 27.05.1996 to 04.03.2001. 3. The authorities under the Central Excise Act, 1944 (hereinafter referred to as 'the Act') had made enquiries on 20.12.1996 and 31.12.1996, under Sub-rule 3 of Rule 173C of the 1944 Rules read with Section 14 of the Act. They had prima facie found that the wholesale price declared by the assessees is much less than the cost of production and, therefore, the price so declared by them could not be treated as a normal price for the purpose of quantification of assessable value under Section 4(1)(a) of the Act and for levy of excise duty as it would amount to short payment of duty. 4. Since further enquiry was required to be conducted regarding the assessable value of the cars, the Assistant Commissioner, Central Excise, Kurla Division, vide his orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss of the price declared by the respondents. The Cost Accountant had calculated the average price of the Fiat UNO Car by adding material cost (import, local, painting and others), rejection at 1% of total cost and notional profit at 5% of total cost for the period from April, 1998 to December, 1998 vide his report dated 31.03.1999, which came to Rs. 5,04,982/- per car. 7. In the meantime, the Superintendent of Central Excise, Kurla Division had issued 11 show cause notices to assessees for the period from June 1996 to February 2000, inter alia, making a demand of differential duty on the assessable value calculated on the basis of manufacturing cost plus manufacturing profit minus MODVAT availed per car, and the duty which the respondents were actually paying on the assessable value. It is alleged in the show cause notices that the respondents have failed to determine and pay the correct duty on Fiat UNO cars while clearing them. It is further stated that the assessees have not taken into account the cost of raw material, direct wages, overheads and profits for calculating the assessable value of the cars which were declared in the invoices and declarations for the purpose of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... market. The assessees had also stated that the amount quantified in the show cause-cum-demand notices is excessive since they were based on the initial costs in 1996 which has continuously come down due to the continuous process of indigenisation of imported components. They would further submit that this strategy of indigenisation of imported components is very common to automobile industry. The assessees had further submitted, the order of provisional assessment was erroneous as well not sustainable in the eyes of the law. They further submitted that the assessable value declared by them should be accepted even if it is below manufacturing cost. The assessees had also contended that there is no short levy or short payment of duty. 9. After receipt of the reply so filed, the adjudicating authority vide his order-in-original dated 31.01.2002 has proceeded to conclude that the assessees' main consideration was to penetrate the market, therefore, the price at which they were selling the Cars in the market could not be considered to be a normal price as per Section 4 of the Act. He has also observed that the cost of production of the Fiat UNO Cars is much higher than the price at w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igeration Corporation, 2003 (153) ELT 249 (SC) . It is the correctness or otherwise of the findings and conclusions reached by the Tribunal is the subject matter of these appeals. Submissions 12. Before we proceed to examine the relevant provisions, it is necessary to notice the submissions made by learned counsel on both sides. Shri. Bhattacharya, the learned ASG, contends that the assessees are not fulfilling the conditions enumerated in Section 4(1)(a) of the Act and therefore, the valuation has to be done in accordance with Section 4(1)(b) of the Act read with the 1975 Valuation Rules. He would contend that the price fixed by the assessees do not reflect the true value of the goods as manufacturing cost and the profit is much higher than the sale price. He would further contend that since the price of the cars sold by the assessees do not reflect the true value of goods and that sole reason for lowering the price by the assessees below the manufacturing cost is just to penetrate the market and compete with other manufacturers and, therefore, such price cannot be treated as "normal price" in terms of Section 4(1)(a) of the Act. He would submit that since the price of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e at which that particular assessee has sold the goods to all the buyers in the ordinary course of business. He would refute Shri Bhattacharya's argument that the price is not the sole consideration, by stating the word 'consideration' is used in the Section in the same sense as used in the Section 2 (d) of the Indian Contract Act, and it is only the monetary consideration from the buyer to the assessee that requires to be taken note of for the purpose of valuation under the Act. He would point out from the show cause notice that the sole ground for rejecting the invoice price of the assessee is that the price was not the sole consideration. He would submit that the intention and consideration cannot be treated as same; it is only the intention of the assessee to penetrate the market and the only consideration for the assessee from the buyer was the sale price. He would further submit that the assessable value has to be gathered from the normal price and not from cost of manufacture which is irrelevant when normal price is ascertainable. Therefore, he would submit only when the normal price is not ascertainable in terms of Section 4(1)(a), then Section 4(1)(b) read with the 1975 Va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Act. 14. Shri Vellapally would further submit by referring to Section 2(d) of the Indian Contract Act, that the consideration should flow from buyer to the seller. He would submit that the meaning of the expression 'consideration' in Section 4 should be determined by comprehensively reading Section 4 along with the Valuation Rules. In this regard, he would submit by referring to Rule 5 that in case the price is not the sole consideration then the value of the goods can be determined by taking into account the monetary value of the additional consideration flowing directly or indirectly from the buyer to the seller. He would submit that any additional consideration should flow from buyer to seller. He would submit that intention of the assessee to penetrate the market cannot be treated as a consideration as no money consideration flows from the buyer to the seller. Therefore, there is no additional consideration flowing from buyer to seller and whole transaction is bonafide. He would submit that this Court has already answered this issue of 'sole consideration' in the cases of Guru Nanak Refrigeration (supra) and CCE v. Bisleri International Pvt.Ltd., 2005 (186) ELT 257 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e price is not available, one of the methodology to determine it is cost. He would further submit, relying on Ship Breaker's case that this Court while explaining the meaning of expression 'Ordinary sale' occurring in Section 14 of the Customs Act which is in pari materia with Section 4 of the Act has observed that "Ordinary Sale' would mean the sale where goods are sold to unrelated parties and price is the sole consideration. 16. Shri. V. Lakshmi Kumaran would further submit that Section 4 of the Act was amended on 1st April 2000 to incorporate 'transaction value' as an assessable value instead of 'normal price' and the expression 'ordinarily' was dropped. Therefore, the new Section 4 (after 2000 amendment) is applicable to the transactions which took place during the period from July, 2000 to June, 2001. He would further submit that the word 'ascertain' and 'determination' have different meaning and connotation. He would submit that the word 'ascertain' would mean to find a thing which already exists whereas determination mean to arrive at something by adding or subtracting. He would then submit that when ascertainment of normal price is not possible under Section 4(1)(a) then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate of Punjab, (1967) 20 STC 430 , that the term 'purchase' would mean acquisition of goods for sale for cash or deferred payment or other valuable consideration. He would further submit that sale and purchase are different perspectives of same transaction and the price is defined in the Sale of Goods Act as "money consideration" and the expression 'cash', 'deferred payment' and 'other valuable consideration' are consistently used as monetary consideration. He further contended that Section 4(1)(a) of the Act has six ingredients and if any one of these ingredients is missing, then only the Revenue could invoke the Valuation Rules. He relies on Circular, issued by the Board, No.215/49/96-Cx., dated 27.05.1996, wherein the Board has clarified that if price was not the sole consideration then any additional consideration that flow from the buyer to assessee would have to be quantified in terms of money, if the Department was not in a position to determine the same, then Rule 7 would not be applicable. Learned counsel would state that Rule 7 was the only Rule which could be applied in case the price was not sole consideration and if that Rule was not applicable then no Rule of the Val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the wholesale trade of the assessees. 21. The decision in the present case turns upon the interpretation of Section 4(1)(a) and Section 4(1)(b) of the Act read with relevant Rules in order to determine the correctness or otherwise of impugned judgment and order. 22. To begin with, we might like to state here that the facts of the case undoubtedly reveal that if the provisions of the Section 4(1)(b) were to apply, it may work serious hardship to the respondents-asseessees as contended by learned senior counsel for the assessees, but as we are concerned with interpretation of a statutory provision, the mere fact that a correct interpretation may lead to hardship would not be a valid consideration for distorting the language of the statutory provisions. 23. Section 3 of the Act is the charging provision. The taxable event for attracting excise duty is the manufacture of excisable goods. The charge of incidence of duty stands attracted as soon as taxable event takes place and the facility of postponement of collection of duty under the Act or Rules framed thereunder can in no way effect the incidence of duty. Further, the sale or ownership of the end products is also not relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excisable goods with reference to value, such value shall, subject to the other provisions of this section be deemed to be - (a) the normal price thereof, that is to say, the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale: Provided that - (i) where in accordance with the normal practice of the wholesale trade in such goods, such goods are sold by the assessee at different prices to different classes of buyers (not being related persons) each such price shall, subject to the existence of the other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each such class of buyers; (ii) where such goods are sold by the assessee in the course of wholesale trade for delivery at the time and place of removal at a price fixed under any law for the time being in force, or at a price, being the maximum fixed under any such law, then, notwithstanding anything contained in clause (iii) of this proviso the price or the maximum price, as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ills Ltd. v. U.O.I, (1987) Supp. (1) SCC 350 , observed that a deeming provision creates a legal fiction and something that is in fact not true or in existence, shall be considered to be true or in existence. Therefore, though the price at which the assessee sells the excisable goods to a buyer or the nearest ascertainable price may not reflect the actual value of the goods, for the purpose of valuation of excise duty, by the deeming fiction created in Section 4(1), such selling price or nearest ascertainable price in the market, as the case may be, is considered to be the value of goods. 27. It is well settled that whenever the legislature uses certain terms or expressions of well-known legal significance or connotations, the courts must interpret them as used or understood in the popular sense if they are not defined under the Act or the Rules framed thereunder. Popular sense means "that sense which people conversant with the subject matter, with which the statute is dealing, would attribute to it." 28. The normal rule of interpretation is that the words used by the legislature are generally a safe guide to its intention. Lord Reid in Westminster Bank Ltd. v. Zang [(1966) A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concept of normal price. That was in the context of transaction between the related persons. It was observed "that the existence of any extra commercial consideration while fixing a price would not amount to normal price." 33. In Burn Standard Co. Ltd. Anr. v. Union of India (1991) 3 SCC 467 , it is stated, "Section 3 of the Act provides for levy of the duty of excise. It is a levy on goods produced or manufactured in India. Section 4 of the Act lays down the measure by reference to which the duty of excise is to be assessed. The duty of excise is linked and chargeable with reference to the value of the excisable goods and the value is further defined in express terms by the said section. In every case the fundamental criterion for computing the value of an excisable article is the normal price at which the excisable article or an article of the like kind and quality is sold or is capable of being sold by the manufacturer." 34. In Tata Iron and Steel Co. Ltd. v. Collector of Central Excise, Jamshedpur (2002) 8 SCC 338 , it is held that "it is true to be seen that under the said Act excise duty is chargeable on the value of the goods. The value is the normal price i.e. the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessable value. It was the price at which goods were ordinarily sold by the assessee to the buyer in the course of wholesale trade. Under Section 4(1)(b) it was provided that if the price was not ascertainable for the reason that such goods were not sold or for any other reason, the nearest equivalent thereof had to be determined in terms of the Valuation Rules, 1975. Therefore, Rule 57-CC has to be read in the context of Section 4(1) of the 1944 Act, as it stood at the relevant time. Section 4(1)(a) equated "value" to the "normal price" which in turn referred to goods being ordinarily sold in the course of wholesale trade. In other words, normal price, which in turn referred to goods being ordinarily sold in the course of wholesale trade at the time of removal, constituted the basis of the assessable value." 39. In Siddhartha Tubes Ltd. v. CCE, (2005) 13 SCC 564 , at page 567, it is held: "5......The essential basis of valuation under Section 4 of the Act is the wholesale cash price charged by the appellant. Normal price under Section 4(1)(a) constituted a measure for levy of excise duty. In the present case, we are concerned with assessment and not with classification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the market in the wholesale trade. Generally speaking, the normal price is the one at which goods are sold to the public. Here the sale to the public is through the dealers. So the normal price is the sale price to the dealer. The proviso, which has been relied upon by learned counsel, does not make any exception to this normal rule. All that the proviso provides is that if an assessee sells goods at different prices to different classes of buyers, then in respect of each such class of buyers, the normal price would be the price at which the goods are sold to that class. The proviso does not mean or provide that merely because the assessee sells at different prices to different classes of buyers, the price of that commodity becomes an unascertainable price. The price of that commodity will remain the normal price at which those goods are ordinarily sold by the assessee to the public, in other words, the price at which they are sold in the market." 42. In Procter Gamble Hygiene Health Care Ltd. v. Commissioner of Central Excise, Bhopal, (2006) 1 SCC 267 , it is held : "9. This case relates to valuation. At the outset, we would like to clarify certain concepts under the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er price. The existence of extra commercial consideration while fixing the price would not be the 'normal price' as observed by this Court in Xerographic Ltd.'s case (supra). If price is the sole consideration for the sale of goods and if there is no other consideration except the price for the sale of goods, then only provisions of Section 4 (1)(a) of the Act can be applied. In fact, in Metal Box's case (supra) this Court has stated that under sub- Section (1) (a) of Section 4 of the Act, the 'normal price' would be the price which must be the sole consideration for the sale of goods and there cannot be any other consideration except the price for the sale of goods and it is only under such situation Sub-Section (1) (a) of Section 4 would come into play. In the show cause notices issued, the Revenue doubts the normal price of the wholesale trade of the assessees. They specifically allege, which is not disputed by the assessees, that the 'loss making price' continuously for a period of more than five years while selling more than 29000 cars, cannot be the normal price. It is true that in notices issued, the Revenue does not allege that the buyer is a related person, nor do they all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dinary course of business by the assessee to all the buyers is the same or uniform without any exception. He would, therefore, contend that the goods are ordinarily sold in terms of Section 4 (1) (a) of the Act. While adopting the submission of Shri Vellapally, Shri Lakshmi Kumaran would further contend, relying on Ship Breaker's case (supra) that this Court while explaining the meaning of the expression 'ordinarily sold', occurring in Section 14 of the Customs Act, 1962 which is in pari materia with Section 4 of the Act, would mean the sale where the goods are sold to un- related persons and price is the sole consideration. He would also contend that Section 4 of the Act was amended with effect from 1stApril, 2000, to incorporate 'transaction value' as an 'assessable value' instead of 'normal price' and the expression 'ordinarily' was omitted. Therefore, the new Section is applicable to the transactions which took place for the period from July 2000 to June 2001. He would submit by relying on the decision of this Court in Elgi Equipment Pvt. Ltd.'s case (supra), that the word 'ordinarily sold' would mean the normal practice or the practice followed by majority of persons in the wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the course of international trade. The word "ordinarily" in Section 14(1) is of great importance. In Section 14(1) we are not to see the actual value of the goods, but the value at which such goods or like goods are ordinarily sold or offered for sale for delivery at the time of import. Similarly, the words "in the course of international trade" are also of great importance. We have to see the value of the goods not for each specific transaction, but the ordinary value which it would have in the course of international trade at the time of its import." 47. In Varsha Plastics Private Limited Anr. v. Union of India Ors., (2009) 3 SCC 365 , at page37 , it is observed: "19. Section 14(1) of the Act prescribes a method for determination of the value of the goods. It is a deeming provision. By legal fiction incorporated in this section, the value of the imported goods is the deemed price at which such or like goods are ordinarily sold or offered for sale for delivery at the time and place of importation in the course of international trade. 20. The word "ordinarily" in Section 14(1) is a word of significance. The ordinary meaning of the word "ordinarily" in Section 14(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned counsel to give a meaning which does not fit into the meaning of the expression 'ordinarily sold'. In other words, in the transaction under consideration, the goods are sold below the manufacturing cost and manufacturing profit. Therefore, in our view, such sales may be disregarded as not being done in the ordinary course of sale or trade. In our view, for the purpose of Section 4(1) (a) all that has to be seen is: does the sale price at the factory gate represent the wholesale cash price. If the price charged to the purchaser at the factory gate is fair and reasonable and has been arrived at only on purely commercial basis, then that should represent the wholesale cash price under Section 4(1)(a) of the Act. This is the price which has been charged by the manufacturer from the wholesale purchaser or sole distributor. What has to be seen is that the sale made at arms length and in the usual course of business, if it is not made at arms length or in the usual course of business, then that will not be real value of the goods. The value to be adopted for the purpose of assessment to duty is not the price at which the manufacturer actually sells the goods at his sale depots or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it that the intention of the assessees to penetrate the market cannot be treated as extra commercial consideration as it does not flow from the buyer to the seller. Therefore, there is no additional consideration flowing from buyer to seller and whole transaction is bona fide. 53. Now what requires to be considered is what is the meaning of the expression 'sole consideration'. Consideration means something which is of value in the eyes of law, moving from the plaintiff, either of benefit to the plaintiff or of detriment to the defendant. In other words, it may consist either in some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility, given, suffered or undertaken by the other, as observed in the case of Currie v. Misa (1875) LR 10 Ex. 153 . 54. Webster's Third New International Dictionary (unabridged) defines, consideration thus: "Something that is legally regarded as the equivalent or return given or suffered by one for the act or promise of another." 55. In volume 17 of Corpus Juris Secundum (p.420-421 and 425) the import of 'consideration' has been described thus: "Various definitions of the meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agent or distributor is lower than the real value of the goods which will mean the manufacturing cost plus manufacturing profit, the Excise authorities can refuse to accept that price. 60. Since under new Section 4(1)(a) the price should be the sole consideration for the sale, it will be open for the Revenue to determine on the basis of evidence whether a particular transaction is one where extra- commercial consideration has entered and, if so, what should be the price to be taken as the value of the excisable article for the purpose of excise duty and that is what exactly has been done in the instant cases and after analysing the evidence on record it is found that extra-commercial consideration had entered into while fixing the price of the sale of the cars to the customers. When the price is not the sole consideration and there are some additional considerations either in the form of cash, kind, services or in any other way, then according to Rule 5 of the 1975 Valuation Rules, the equivalent value of that additional consideration should be added to the price shown by the assessee. The important requirement under Section 4(1)(a) is that the price must be the sole and only con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for sale, is not satisfied, then the transaction value shall not be the assessable value and value in such case has to be arrived at, under the Central Excise Valuation (Determination of Price of Excisable Goods) Rules 2000 ('the Rules 2000' for short) which is also made effective from 1st July, 2000. Since the price is not the sole consideration for the period even after 1st July, 2000, in our view, the assessing authority was justified in invoking provisions of the Rules 2000. 62. Reference to the Citations : Shri Bhattacharya, learned ASG, submits that in view of the decision of this Court in Bombay Tyre International case (supra), the nominal price of the goods, even if it is sold for a loss price, for the purpose of assessable value under Section 4 of the Act, at least the manufacturing cost and manufacturing profit should be taken into consideration. In view of this decision, the learned counsel goes to the extent of saying the judgements relied upon by the opposite side on the decision of this Court in Guru Nanak Refrigeration (supra) and Bisleri International (supra) should be treated as per-incurium. We cannot agree. In Bombay Tyre's case, the issue before the Court w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us trade discount would represent the assessable value and in that decision there was no issue on the question of including the post manufacturing cost and post-manufacturing profits. In conclusion, insofar as amended Section 4 of the Act, the Court has observed that the assessable value will be the price at which the goods are ordinarily sold by the assessee to the buyer in the course of wholesale trade at the factory gate. However, firstly, the buyer should not be a related person and the price should be sole consideration for the same. This proposition is subject to Section 4(1)(a). Secondly, if the price of the excisable goods cannot be ascertained either because the goods are not sold or for any other reason, the value will have to be determined as per the Central Excise Valuation Rules. 63. Our attention was also drawn by learned counsel Shri Bhattacharya to the decision of this Court in Assistant Collector of Central Excise Ors.. v. M.R.F. Ltd. 1987 (27) ELT 553 (SC) , wherein the Court dealt with concept of post-removal expenses. 64. Shri Vellapally and Shri Lakshmi Kumaran learned Counsel by placing reliance on Guru Nanak's case (supra) and Bisleri's case (supra) co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of exra-commercial consideration was shown to the buyers of aerated waters (beverages). The Court has also observed that under Section 4, the price and sale are related concepts. The value of the excisable article has to be computed with reference to the price charged by the manufacturer, the computation being made in accordance with Section 4. In every case, it will be for the revenue to determine on evidence whether the transaction is one where extra-commercial consideration have entered and if so, what should be the price to be taken into account as the value of the excisable article for the purpose of excise duty. 66. In our considered view, either the decision of Guru Nanak's case (supra) or the decision in Bisleri's case (supra) would assist the assessee in any manner whatsoever. We say so for the reason, that, in Guru Nanak's case, the department had accepted the price declared by the assessee and the narration of the facts both by the Tribunal and this Court would reveal that it was one time transaction and lastly, this Court itself has specifically observed that the view that they have taken, is primarily based on the facts and circumstances of the case. In the instant c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4(1)(b) of the Act and the relevant rules. He would further submit that the Valuation Rules need not be applied sequentially. He would contend that all the Rules 3, 4, 5, 6 and 7 of the 1975 Valuation Rules specifically use the expression "shall...be determined", "shall be based" or "shall determine the value" and nowhere word "sequentially" occurs in these Rules, unlike Rule 3(ii) of the Customs Valuation Rules, 1988. He would submit that merely the presence of word "shall" does not imply that all the Rules has to be applied sequentially. He would further submit that in the facts and circumstances of the present cases, Rule 7 is the only applicable Rule in view of the decision in Bombay Tyre's case and assessing authority as well as the first appellate authority correctly adopted the application of this Rule. 68. Per Contra, Shri Joseph Vellapally, would submit that only when the normal price is not ascertainable in terms of Section 4(1)(a), then Section 4(1)(b) read with the 1975 Valuation Rules would come into play to determine the nearest equivalent assessable value of the goods. He would contend that the Valuation Rules have to be applied sequentially, i.e. first, Rules 4 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under the aforesaid Rules. A bare reading of these rules does not give any indication that the adjudging authority while computing the assessable value of the excisable goods, he had to follow the rules sequentially. The rules only provides for arriving at the assessable value under different contingencies. Again, Rule 7 of the Valuation Rules which provides for the best judgment assessment gives an indication that the assessing authority while quantifying the assessable value under the said Rules, may take the assistance of the methods provided under Rules 4, 5 or 6 of the Valuation Rules. Therefore, contention of the learned counsel that the assessing authority before invoking Rule 7 of the 1975 Valuation Rules, ought to have invoked Rules 4, 5 and 6 of the said Rules cannot be accepted. In our view, since the assessing authority could not do the valuation with the help of the other rules, has resorted to best judgment method and while doing so, has taken the assistance of the report of the 'Cost Accountant' who was asked to conduct special audit to ascertain the correct price that requires to be adopted during the relevant period. Therefore, we cannot take exception of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
