9911796707
TMI Blog2017 (1) TMI 491X X X X Extracts X X X X X X X X Extracts X X X X ..... hearing has become infructuous. Accordingly, the same is dismissed as infructuous. 2. Both sides are in appeal before us. M/s S Kumar Ltd. (SKL) is a processor of grey fabrics and paying duty on the finished goods. As grey fabrics is exempted from duty, therefore, M/s. SKL who is engaged in the manufacture of man-made grey fabrics and M/s. S Kumar Synfab Ltd. (SKS) is merchant manufacture who supplied the man made grey fabrics and get the same processed from M/s. SKL. The dispute arose regarding the valuation of processed grey fabrics for payment of Central Excise duty. Revenue is of the view that the manufacturing expenses and other expenses were not properly allocated and added resulting in short levy of duty by M/s. SKL. In these set o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said order has attained finality and cannot be agitated in denovo proceedings. He, further submits that in the earlier round of litigation, the penalty on M/s. SKS was dropped by the Tribunal and the said order was not challenged by the Revenue. Therefore, the said order has attained finality. Therefore, penalty on M/s. SKS has not been imposable. Therefore, he prayed that the appeals filed by the Revenue are to be dismissed. 3. With regard to the demand confirmed against M/s. SKL, he submits that M/s. SKL is engaged in the processing of man made fabrics, into processed fabrics. M/s. SKS buys fibre from the market and give the same to various spinning units for conversion into yarn on payment of conversion charges. M/s. SKS also purchas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id by SKS / SKL. There is no dispute with regard to this. Learned Commissioner has confirmed the duty demand by seeking to add certain expenses shown in the balance sheet by M/s. SKS such as interest, administrative expenses, payment of employees, depreciation etc.. It is his submission that it is not disputed fact and cost of yarn and cost of conversion is based on prevalent market rate. Further, inspite of the fact that prevalent market rates were relied upon, M/s. SKS made a provision for 1% of the cost as wastage and 1% of the cost as incidental charges to cover for any difference between the actual cost and market rate. In the said circumstances, the case of the appellant is clearly covered by Rule 6(b)(i) of the Central Excise (Valuat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sheet with costing details. The various components for arriving at cost of grey and cost towards proces loss, processing/packing charges have been specified. The cost of yarn is said to be based on prevailing market rate. The Original Authority held that the costing should have done only on actuals. However, while arriving at the figures for purported undervaluation the Revenue relied on Profit & Loss Account and Balance Sheet of second Respondent for cost of grey fabrics. Further, addition to the cost thus arrived was made towards freight, tax, insurance, commission, etc. again based on the said Balance Sheet. We find such exercise to arrive at assessable value for the impugned period is without any legal basis and arbitrary. We find that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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