2017 (11) TMI 230

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..... vade.  The Commissioner(Appeals) has also upheld the demand of interest under Section 11AB which is a statutory levy. 2.   Briefly the facts of the present case are that the appellants are manufacturers of watches and watch components falling under Chapter 91 / 92 of the Central Excise Tariff Act, 1985.  During the course of audit by the Internal Audit party of the Central Excise Department, it was noticed that during the period from December 1998 to October 2000, the assessee manufactured and cleared watch dials to their sister units viz. HMT Watch factory I and II on payment of duty basing on the transfer price, adopted by them.  The transfer price so adopted was much less than the price adopted for clearances of .....

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.....   Hence the present appeal. 3.   Heard Shri Veeragowda, learned consultant for the appellant and Shri N. Jagdish, Superintendent(AR) for the respondent. 4.   After considering the grounds of appeal raised by the assessee, we find that the appellant who is a manufacturer of watch and watch components cleared bulk quantities of the components for captive consumption to their sister concern for the manufacture of watches and only a small percentage of component is cleared to the showrooms and dealers for the repair and maintenance of watches.  We also find that price adopted for the dealers and the showrooms is much higher than the price adopted for captive consumption and it is the stand of the Department that .....

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..... s as are captively consumed are sold in the open market. The price at which these goods are sold by the appellants satisfy all the parameters of the normal price as are set out under Section 4(l)(a). Under the Central Excise Law, if normal price for the purpose of assessment of duty under Section 4(l)(a) subject to other provisions of Section 4, is available notwithstanding the percentage of the sale at this price, the same has to be adopted for assessment of all goods cleared from the factory. In the instant case, although the percentage of goods sold to dealers is very less i.e. less than one per cent, but such sale price is to be considered. [1980 (6) E.L.T. 454 (Bom.), 1978 (2) E.L.T. (J 561), 1983 (14) E.L.T. 1896 (SC) relied on] 6.&n .....

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