TMI Blog2007 (5) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... ise Tariff Act, 85. One more unit set up adjacent to IMIL by the name of M/s. Ispat Industries Ltd. (hereinafter referred to as IIL) is engaged in the manufacture of H.R. Coils from Directly Reduced Iron. IMIL was promoted by IIL for setting up a blast furnace for the manufacture of hot metal/pig iron mainly to cater to the needs of IIL for hot metal required in the manufacture of H.R. coils by IIL. IMIL had cleared hot metal/pig iron to IIL on payment of duty at an assessable value calculated @ 115% of cost of production in terms of Rule 8 of Central Excise (Valuation) Rules, 2000 by issuing invoices at an estimated price of Rs. 6,500/- P.M.T. and paying differential duty on the revised assessable value. While working out the cost of produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We see force in the submission of the appellants that the demand of Rs. 35,14,16,652/- is barred by limitation as they cannot be held to be guilty of suppression with intent to evade payment of duty so as to apply the extended period of limitation against them. The Commissioner's findings on time-barred nature of the demand are contained in Paragraphs 25 and 26 of the impugned order, which are reproduced below :- "25. Similarly in the monthly ERI returns, IMIL have made a declaration in the assessment memorandum at clause (b) as " We have assessed the ad valorem duty on the clearance documents in terms of Section 4 of the Act read with Valuation Rules, 2000 or in terms of Section 4A of the Act." Although, IMIL were aware of clearance of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e fluctuations, handling charges etc. in the cost of production as per CAS-4 standards which indicates that they do agree that it is not a trial run production. Thus, the above acts of the assessee invokes proviso to Section 11A of the Central Excise Act, 1944. 26. To sum up, I am firmly of the view that IMIL was very much aware of the fact that depreciation of plan and machinery is required to be added to the cost of production but with an intention to evade the payment of C. Ex. duty they did not include the element of depreciation in the cost of production under the guise that it is a trial run production. Thus they have failed to correctly assess the cost of production by not including the element of depreciation of plant and machiner ..... X X X X Extracts X X X X X X X X Extracts X X X X
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