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2015 (4) TMI 1028 - CESTAT MUMBAI

2015 (4) TMI 1028 - CESTAT MUMBAI - TMI - Valuation of goods - Inclusion of overhead cost and profit margin - Held that:- Personal hearing was granted to the appellant on 28.12.2004 and the Commissioner has relied upon the reports of the AD (Cost), which are dated 23.2.2005 and 14.3.2005 and the order is passed on 31.3.2005. Under the circumstances, we find force in the contention of the counsel for the appellant that there has been serious breach of principles of natural justice inasmuch as the .....

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ef facts of the case are that the appellant is manufacturer of biscuits, confectionary and other items. They are manufacturing the biscuits in their own units and also getting the same manufactured from other persons termed as contract manufacturers. When such biscuits are being manufactured, the appellant supplies them as Parle mix of different flavours and various types of printed wax papers and wrappers . These two items are manufactured by the appellant and supplied to the contract manufactu .....

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the cost of Parle mix of different flavours and various types of packaging materials manufactured by them, it was noticed that while calculating the cost of these items, certain indirect cost elements viz. overhead cost and profit margin were not included in the value of the said products. Accordingly two show cause notices were issued to the appellant, one covering the period April 1999 to March 2003 and the other covering the period April 2003 to March 2004. The case was adjudicating by the Co .....

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the confirmed demand. 3) I impose penalty of ₹ 24,23,689/- under the provisions of Section MAC of Central Excise Act, 1944, read with Rule 1730 of Contra] Excise Rules, l944, and Rule 25 of Central Excise Rules, 2001/2002, in respect of Show Cause Notice No.V-Adj(Misc)30-45/04 dt.29.04.04. 4) I also impose penalty of ₹ 8,95,352/- under the provisions of Section 1 1AC of Central Excise Act, 1944, and Rule 25 of Central Excise Rules, 2001/2002, in respect of Show Cause Notice No.V-Adj .....

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order has been passed without getting their comments. Hence there has been a case of breach of principles of natural justice. The learned counsel also submitted that they have no objection in following the CAS-4 system even for the earlier period. However, the assessable value arrived as per CAS-4 system by the AD (Cost) should be supplied to them so that they can examine the same and rebut the same. The learned counsel also submitted that in both the show cause notices, extended period of limit .....

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