TMI Blog2007 (6) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) of the Central Excise Act, 1944 has been invoked. After completing the adjudication proceedings, the Commissioner confirmed the following demands Duty Education cess (a) Rs. 1,03,09,560/- Rs. 999/- (b) P.s. 47,56,028/- Rs 1,10,340/- (c) Rs. 29,43,542/- Rs. 68,290/- The following penalties were imposed (a) Rs. 1,03,09,560 + Rs. 999/- under Section 11AC of the C.E. Act, 1944. (b) Rs. 2,00,000/- under Rule 25 of the C.E. Rules, 2002. (c) Rs. 2,00,000/- under Rule 25 of the C.E. Rules, 2002 Interest under Section 11AB was also demanded. The appellants strongly challenged the impugned order. Hence they have come before the Tribunal for relief. 3. Dr. Sameer Chakraborty, learned Advocate appeared for the appellants and Shri Schidanand, JDR appeared for the Revenue. 4. The learned Advocate explained the following points :- (i) The appellants manufactured the goods as per the specific requirements of buyers. In certain cases, the goods to be manufactured are sold at ex-works prize to the buyers. In cases where the customers intend to get services like application of the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particulars and education cess paid during the period from October 2003 to March 2006 is included in the Paper Book. (vi) The Commissioner has not dealt with the detailed submissions made by the appellants on the issue involved supported by the decisions of Apex Court, Tribunal and also binding Circulars of Central Board of Excise and Customs. (vii) There is no reference nor any discussion on the submissions of the appellants except for incorrect reference and appreciation of the decision of the. Apex Court in Acer India Ltd. [2004 (172) E.L.T. 289 (S.C.)] (viii) There is no legally justifiable reason or basis whatsoever to include in determining the "transaction value" and consequently the assessable value, the costs towards Application Services, which were undertaken by the appellants under separate agreement in specific cases, at the customers option and which services were not a condition precedent for sale and purchase of the said goods and had no nexus or bearing for the sale of such goods. (ix) The Commissioner has proceeded on ex facie erroneous premises that in respect of each and every contract where under the goods were manufactured and sold by the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocess not amounting to manufacture of manufactured goods in a separate/other unit of the same group or by any independent job worker." The Advice of the Ministry of Law has been accepted by the Board. It was also urged that the Tribunal in several decisions has held that what is relevant is the nature of the goods at the time of removal from the factory and subsequent use to which the said goods are put to have no relevance whatsoever in the valuation of the said goods. The following case laws were relied on :- (a) IVRCL Infrastructure Projects Ltd. v. Commissioner of Central Excise [2004 (169) E.L.T. 194 (T)] (b) Carrier Aircon Ltd. v. Commissioner of Central Excise [2003 (160) E.L.T. 419 (T)] (c) Emerson Network Power India Pvt. Ltd. v. Commissioner of Central Excise [2004 (176) E.L.T. 168 (T)] (d) Rhino Machines Pvt. Ltd. v. Commissioner of Central Excise [2005 (181) E.L.T. 63(T)] (e) Jyoti Overseas Ltd. v. Commissioner of Central Excise [2001 (130) E.L.T. 446 (T-LB.)]; affirmed by the Supreme Court in the case of CCE v. Simplex Mills Co. Ltd. [2005 (181) E.L.T. 345 (S.C.)] (f) National Engg. Industries Ltd. v. CCE [2002 (149) E.L.T. 1010.(T)] (g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the manufacturing process of the excisable goods is completed at the site of the customer. On going through the records, we find that in certain cases the appellants have supplied only the goods to the buyers. In other words, it is not obligatory on the part of the buyer to entrust the work of installation Application Services to the appellants. On those cases, there is absolutely no question of adding the application charges for the simple reason that such charges do not exist at all. In certain cases, apart from purchase of goods the buyers want the appellant to undertake repair/application/maintenance, etc. in their premises. For example, in certain furnaces they would have to replace the worn out refractory material with the new goods. In such cases, the appellants enter into a composite contract which indicates actually the total value of the goods as well as the services. In those cases, the appellants had already discharged the duty liability on the entire amount because it was not possible for them to vivisect the composite contract. Hence there is no dispute on these types of contracts. 7. However, there are cases in which the appellants have entered into separate con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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