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2018 (4) TMI 762

ny - it was alleged that the valuation of goods cleared by the appellant to M/s Maruti Suzuki should be on the basis of Rules 8 & 9 of the Central Excise Valuation Rules, 2000 - whether the two parties are “related persons” as per Section 4(3) (d) of the Act? - Held that: - there is no evidence on record of the fact that such alleged mutuality of interest has resulted in lower price due to extra commercial considerations - it cannot be said that the two companies are ‘related persons’ in terms of sub-clause (ii), (iii) or (iv) of Section 4(3) (b) of the Act. Valuation of goods as per Rule 9 read with Rule 8 of the Central Excise Valuation Rules, is applicable only in a case where goods are sold to or through a person who is related. - .....

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8 & 9 of the Central Excise Valuation Rules, 2000. Since the Central Excise duty for such clearances was paid on the basis of transaction value, differential duty was demanded from the appellant by issue of SCN dated 04.03.2014 covering the period April, 2012 to March, 2013. Such differential duty stands confirmed against the appellant by both the authorities below along with levy of penalties. Aggrieved by the impugned order, the present appeal has been filed. 2. With the above background, we heard S/Shri S.C. Jain and Rajat Doshi, ld Advocates for the appellant as well as Shri M.R. Sharma, AR for the Revenue. 3. The case of the appellant was argued as follows: i) For the appellant to be considered as a related person with M/s Maruti S .....

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ssion clause is not maintainable. 4. The ld DR justified the impugned order. He submitted that the appellant as well as M/s Maruti Suzuki India Ltd are related persons, who have interest in the business of each other. Consequently, the valuation of clearance to M/s Maruti Suzuki India Ltd is required to be done in terms of Rule 9 read with Rule 8 of the Valuation Rules. 5. Heard both sides and perused the record. 6. The dispute in the present case is regarding the valuation of automobile parts cleared by the appellant to M/s Maruti Suzuki India Ltd, who were holding shares to the extent of 39% in the appellant s company. The stand of the Revenue is that the two are related persons as per Section 4(3) (d) of the Act. The said sub-section is .....

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ut we note that there is no evidence on record of the fact that such alleged mutuality of interest has resulted in lower price due to extra commercial considerations. Consequently, we are of the view that it cannot be said that the two companies are related persons in terms of sub-clause (ii), (iii) or (iv) of Section 4(3) (b) of the Act. Valuation of goods as per Rule 9 read with Rule 8 of the Central Excise Valuation Rules, is applicable only in a case where goods are sold to or through a person who is related in the above manner. 8. Rule 10 of the Valuation Rules deals with the valuation of goods sold to or through inter-connected undertaking . Since the two companies are not related in terms of sub-clause (ii), (iii) or (iv) of Section .....

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r they buyer is holding company or subsidiary company or is also so connected with the assessee that they are related persons in terms of clause (ii) or (iii) or (iv) of Section 4(3) (b) of the Central Excise Act. In this case, neither M/s P.S. Steel Tubes (p) Ltd is holding company or subsidiary company of the respondent nor there is any evidence to prove that the respondent are so connected with M/s P.S. Steel Tubes that they are also related in terms of Clause (ii), (iii) or (iv) of Section 4(3)(b). In view of this, the respondent and M/s Steel Tubes (P) Ltd cannot be treated as related persons and, as such, there is no infirmity in the impugned order. The Revenue s appeal is, therefore, dismissed. 9. By following the above order, we set .....

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