TMI Blog2015 (5) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... r concern. - differential duty demand on both the counts are correct and legal and the same does not require any interference. Appellant have not added amortization cost in respect of goods supplied to other than related person and also not correctly valued in respect of goods supplied to their sister concern. The fact of incorrect valuation and consequent short payment of duty was clearly suppressed by the appellant from the department therefore proviso to Section 11A in demanding differential duty was correctly invoked - It is straight law, irrespective of any other factors as and when a manufactured goods is cleared from the factory of the manufacturer he is bound to pay the correct duty leviable thereon, there is no explanation provided in the excise law that if buyer is entitled for the Cenvat Credit therefore no duty is required to be paid. Therefore, we do not agree that merely because recipient of the goods are entitled for the Cenvat Credit, it is a case of revenue neutrality. The availment of Cenvat Credit is subsequent act and that cannot be basis for payment of duty in the clearance of the goods from the manufacturer factory. - . Commissioner has correctly imposed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chakan (Reference to para 12(d) of Show Cause Notice). (viii) I appropriate the amount of ₹ 10,83,074/- already padi by ASAL Chakan during investigation towards interest liability demanded in (vii) above (Reference to para 12(d) of Show Cause Notice). (ix) I impose penalties of ₹ 49,61,809/- (Rupees Forty Nine Lakhs Sixty One Thousand Eight Hundred and Nine only) and ₹ 2,02,99,124/- (Rupees Two Crores Two Lakhs Ninety Nine Thousand One Hundred and Twenty Four Only) under Section 11AC of Central Excise Act, 1944 read with Rule 25 of the Central Excise Rules, 2002 on ASAL Chakan (Reference to para 12(e) of Show Cause Notice). (x) It is however ordered that if the duty and interest is paid within 30 days from the date of receipt of this order, the assessee is liable to pay only 25% of duty as penalty subject to the condition that the reduced penalty is applicable if the same is paid within 30 days from the date of receipt of this order. (xi) I confirm and demand the duty liability amounting to ₹ 37,79,725/- (Rupees Thirty Seven Lakhs Seventy Nine Thousand Seven Hundred and Twenty Five only) as proposed in the Show Cause Notice No. DGCEI/MZU/I IS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay only 25% of duty as penalty subject to the condition that the reduced penalty is applicable if the same is paid within 30 days from the date of receipt of this order. The fact of the case is that M/s. Automotive Stampings and Assemblies Ltd having units at Chakan and Bhosari-Pune and engaged in the manufacture of Sheet Metal Parts and Welded Assemblies for Automotive Sector falling under Chapter Sub Heading 8708 1090 of the First Schedule to the Central Excise Tariff Act, 1985. On Intelligence, officers of Directorate General of Central Excise Intelligence found that the appellant are :- (1) not including the cost of amortization of tools/dies in the value of the goods manufactured and cleared by them as required under Rule 6 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, (CEVR) 2000. (2) They are not adding 10% to the cost of production as required under Rule 8of CEVR, 2000 while clearing the goods to their sister concern. After investigation carried out, a show cause notice No. DGCEI/MZU/I IS'B'/12(4)65/2009 dated 06.05.2011 was issued to the appellant Chakan and Bhosari Units, wherein it was proposed to demand Central Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are taking Cenvat Credit. It is also a fact that all the assessees are paying huge amount of duty from PLA. It is his submission that even if duty demanded in the impugned order would have been paid at the time of clearances the same would have been availed as Cenvat Credit by the respective consignees and as a result payment of duty made by the consignee on their final product from PLA would have stood reduced to the extent of quantum of the present demand. Therefore there is no loss to the Revenue and in this case there is neutrality of Revenue. He placed reliance on following judgments: (a) Jay Yuhshin Ltd. Vs. Commissioner of Central Excise, New Delhi [2000 (119) E.L.T. 718 (Tribunal - LB)] (b) P.R. Rolling Mills Pvt. Ltd. Vs. Commissioner of C.Ex. Tirupati [2010 (249) ELT 232 (Tri-Bang.)] (c) Commissioner of Central Excise, Mumbai Vs. Special Steel Ltd. - Appeal No.E/389/03 (d) Savita Polymers Ltd. Vs. Commissioner of C.Ex. Raigad [2009 (240) ELT 616 (Tri-Mumbai)] (e) Monga Brothers Ltd. Vs. Commissioner of Central Excise, Ludhiana [2013 (294) ELT 332 (Tri-Del.)] He submits that in the above judgments it has been held that in case of Revenue neutrality, malaf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered the submissions made by both the sides and perused the records. 5. As regard confirmation of duty demand, we observed that duty was demanded on two counts a) on amortization cost of tools, dies, welding guns, pallets etc supplied free of cost by the buyer of the goods, b) in respect of supply made to sister concern of the appellant, valuation was not correctly done in accordance with the rule 8 of Central Excise Valuation Rules, 2000. We find that as regard inclusion of amortization cost in the assessable value of the goods when certain goods such as tools, dies, welding guns, pallets etc supplied free of cost by the customer, the amortized cost must be included in terms of Rule 6 of Central Excise Valuation Rules, 2000, which is reproduced below: RULE 6. Where the excisable goods are sold in the circumstances specified in clause (a) of sub-section (1) of section 4 of the Act except the circumstance where the price is not the sole consideration for sale, the value of such goods shall be deemed to he the aggregate of such transaction value and the amount of money value of any additional consideration flowing directly or indirectly from the buyer to the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... From the above Rule, it is clear that if certain items supplied by the buyers free of cost to the manufacturer the value consideration of the said items in the form of amortization cost must be added in the assessable value for the reason that the sale value in such case cannot be considered as sole consideration. Therefore, we are of the view on this count that amortization cost is legally includible in the assessable value. As regard the goods supplied by the appellant to their sister concern, it is undisputed that valuation of such goods is adopted by cost construction method in terms of Rule 8 of Central Excise Valuation Rules, 2000. In accordance to which valuation should be 110% of the cost of manufacture of the goods. From the impugned order it was found that the appellants have not correctly valued the goods and not added 10% notional profit in the assessable value while clearing the goods to their sister concern. Therefore we are of the view that Ld. Commissioner has correctly and legally confirmed duty on the value arrived at by following the provision of Rule 8, of Valuation Rules, 2000. In view of above position we are of the considered view that differential duty dema ..... X X X X Extracts X X X X X X X X Extracts X X X X
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