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M/s. Autolite India Ltd., M/s. Autolite India Ltd., Sh. RK Mathur (Chief Manager) , Sh. Mahipal Gupta, Director, Sh. Gopal Mathur, General Manager Versus CCE Jaipur-I

2015 (4) TMI 772 - CESTAT NEW DELHI

Determination of assessable value of the halogen capsules cleared by the 100% EOU (Unit-I) to the DTA unit - Held that:- In terms of the provisions of proviso to section 3(1) of Central Excise Act, 1944, while the duty payable in respect of the goods cleared by a 100% EOU into DTA is the aggregate value of duties of customs on import of like goods into India, the assessable value for this purpose is to be determined under section 14 of the Customs Act, 1962. Therefore, the assessable value of th .....

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capsules. Moreover, in terms of the information furnished by the appellant, contemporaneous import of similar goods in comparable quantity had been made at the prices which were comparable with the DTA sale price adopted by the appellant unit. However, we find that the Commissioner has not given any finding on this plea. We are, therefore, of the view that the impugned order rejecting the DTA sale price of the appellant unit is not correct and the same has to be set aside and the matter has to .....

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egation of clandestine removal, this demand is based on entries in the diary recovered from the store keeper, Sh. Satyanarayan, of the DTA Unit. The grievance of the appellant is that the photocopy of this diary has not been supplied to them. In view of this, we hold that this duty demand is also not sustainable and the matter has to be remanded to the Commissioner for de novo adjudication after supplying a copy of this diary to the appellant, and taken into account their submissions in respect .....

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ndia Ltd., Unit-I, located at Sitapura, is a 100% Export Oriented Unit (EOU). This unit manufactures halogen capsules and Halogen bulbs for export. The second unit-II located at Parwati Nagar, Jaipur, is a DTA Unit which manufactures halogen bulbs. A 100% EOU is entitled to make DTA Clearances in terms of the Foreign Trade Policy which in terms of the para 6.8(a) of the Foreign Trade Policy can be upto 50% of the FOB Value of the exports. The period of dispute in this case is from August 2004 to .....

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em, the assessable value has to be determined under section 14 of the Customs Act, 1962. 1.3 In the present case, the unit -Iof the appellant company (100% EOU) had paid duty, in respect of its DTA clearances, on the FOB price at which the goods were being exported. The Department was of the view that this value, adopted by the appellant is not correct and has determined the value by invoking Rule 7(3) of the Customs Valuation Rules, on the basis of the sale price of the Halogen Bulbs of the DTA .....

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A sale price on the basis of sale price at which the halogen bulbs manufactured by the Unit-II (DTA Unit) were being sold. It is on this basis that the duty demand of ₹ 42,92,481/- for the period from August 2004 to July 2005 and duty demand of ₹ 28,65,462/- for the period from August 2005 to February 2006 were made by two separate Show Cause Notices. 1.4 In course of search of Unit-I as well as Unit-II of the appellant company on 06.08.2005, from possession of store keeper of the DT .....

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ssioner Central Excise, Jaipur-I by which the above mentioned duty demands totaling ₹ 86,04,556/- were confirmed against Unit-I of the appellant company along with interest on it under section 11AB and beside this while penalty of equal amount was imposed on unit-I of the appellant company under section 11AC, penalty under Rule 26 of the Central Excise Rules, 2002, of ₹ 5 lac was imposed on Sh. Mahipal Gupta, Director of the appellant company, and penalty of ₹ 2 Lac each was im .....

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d from the store keeper of the DTA Unit (Unit-II), Sh. Satyanarayan and the statement of Chief Manager Sh. RK Mathur, that though, the appellant had requested for supply of the copy of the diary containing the entries regarding alleged clandestine removal by 100% EOU (Unit-I) to the DTA Unit (Unit-II), the diary had not been supplied, that merely on the basis of the entries in the diary and the statement of the Chief Manager, Sh. RK Mathur, the duty demand cannot be confirmed against the unit-I, .....

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t he has not given any finding, that the Commissioner has rejected the value of the DTA clearance on which the duty was paid by the appellant company by comparing the assessable value with the price at which certain types of halogen capsules had been imported by the appellant, that the price at which the halogen capsules had been imported by the appellant is not comparable with the price at which the duty was paid by the appellant in respect of their DTA clearances, as the quantity of the goods .....

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n capsules on the basis of the sale price of the halogen bulbs being manufactured and sold by the DTA unit by reverse calculation by applying rule 7(3) of the Customs Valuation Rules, that Rule 7 is not applicable in this case as unit-II is not manufacturing halogen capsules, that in any case, when the price of contemporaneous import of halogen capsules in comparable quantity is available and the same is comparable with the DTA sale price adopted by the appellant, there would be no justification .....

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Unit as is engaged in only in the manufacture of halogen bulbs. During the period of dispute i.e. form August 2004 to July 2005 and from August 2005 to February 2006 Unit I had made DTA clearances of Halogen capsules to its DTA Unit and the duty on DTA clearances was paid at FOB price at which the same were being exported. According to the Department the assessable value adopted by the appellant in respect of their DTA sale is not acceptable and has to be rejected as this price is much lower th .....

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od, other importers in India were importing similar goods in comparable quantity at the prices which were comparable with the DTA sale price adopted by the Unit I. It is also the contention of the appellant that the price at which the Unit-I (100% EOU) had imported halogen capsules cannot be adopted for the purpose of DTA Sales as that price was for import of only 200 to 500 capsules and the price of gold coated halogen capsules imported by Unit-II was not relevant a gold coated halogen capsules .....

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ce of identical goods or similar goods into India in comparable quantity. 7. In our view, the Department was not correct in adopting the price at which the unit-I had imported 200 to 500 halogen capsules as sample as the quantum of DTA sales being made by the 100% EOU was much larger and in this regard, the import price of gold coated Halogen Capsules was not relevant as the 100% EOU (Unit-I) was not manufacturing such halogen capsules. Moreover, in terms of the information furnished by the appe .....

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