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TMI Blog2007 (10) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... rs to EFL who in turn sell them to customers of on retail basis. The point that the issue is a valuation of spare parts which are as cleared to EFL who use them in repairs and maintenance of water purifiers for which Annual Maintenance Contract has been entered with the customers. The respondents cleared certain spares to EFL who sell them. In such cases the respondents pay duty on the basis of the sale value of EFL. However in respect of this spares cleared to EFL who use them in their maintenance contract with the customers, the value adopted for payment of duty is under Rule 8 of the Central Excise Valuation Rules, 2000. The original authority held that the respondents should pay duty even in such cases on the basis of sale price of EFL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such cases one should take recourse to Rule 11. Once recourse is taken to Rule 11 one has to go to Rule 8 which is the only rule where valuation is determined when there is no sale. Our attention was also invited to the clarification issued by CBEC in its Circular No. 643/34/2002-CX., dated 1-7-2002. Valuation Rules — Clarifications Circular No. 643/34/2002-CX., dated 1-7-2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and re course will have to be taken to the Valuation Rules. No specific rule covers such a contingency. Except Rule 8 all the other rules cover contingencies where sale is involved in some form or the other. Therefore, the residuary Rule 11 will have to be adopted along with the spirit of Rule 8. In other words, the assessable value would be115% of the 'cost of production or manufacture' of the goods. 5. This case is also similar to the case, which is clarified above. When there is not sale as there is no specific rule to cover the same, Rule 8 would be the most appropriate. The learned JDR relied on certain case laws, which are not very relevant for the issue at hand. Therefore, we do ..... X X X X Extracts X X X X X X X X Extracts X X X X
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