TMI Blog2018 (5) TMI 1448X X X X Extracts X X X X X X X X Extracts X X X X ..... lue at the end of appellant for finalisation of provisional assessment - appeal allowed - decided in favor of appellant. - Appeal No. E/808/2009 - A/62219/2018-EX[DB] - Dated:- 14-3-2018 - Mr. Ashok Jindal, Member (Judicial) And Mr. Anil G. Shakkarwar, Member (Technical) Shri. B.L. Narasimhan, Advocate- for the appellant Shri. A.K. Saini, AR- for the respondent Per Ashok Jindal: The appellant is in appeal against the impugned order demanding duty from the appellant in terms of Rule 8 of the Central Excise(Determination of the price of excisable goods) Valuation Rules, 2000. 2. The facts of the case are that the appellant is a job worker of M/s Glaxo Smithkline Consumer Healthcare Ltd. (hereinafter referred to as GSK ) manufacturing malted food preparations namely Boost on job work basis for M/s Glaxo Smithkline Consumer Healthcare Ltd. The appellants receive various raw materials like Boost intermediates from GSK. The appellants use these raw materials for the manufacture of finished goods on job work basis for GSK. At the time of clearance of finished goods, the appellants pay excise duty based on the assessable value worked out on the basis of valuatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 05.10.2005, finally assessed the value of Boost cleared by the appellants to GSK during the relevant period @ ₹ 83.17 per kg. Aggrieved by the aforesaid Final Assessment Order dated 05.10.2005, the appellants filed an appeal before the Commissioner (Appeals), Central Excise, Jalandhar. The Commissioner (Appeals) vide Order-in-Appeal No.34/CE/IAL/2007 dated 31.01.2007 set aside the Final Assessment Order dated 05.10.2005 and remanded the case back to adjudicating authority to decide the same afresh in the light of guidelines laid down by Hon ble Supreme Court in the case of UJAGAR Prints ltd. Vs. UOI-1989(39) ELT 493 (SC) after affording an opportunity of personal hearing to the appellants. The aforesaid order-in Appeal dated 31.01.2007 was challenged by the Revenue before CESTAT on the ground that the Commissioner (A) did not have power to remand the case back to the adjudicating authority by following the judgment of Hon ble High Court of Punjab and Haryana in the case of Enkay India Rubber Co. Pvt. Ltd. as reported in 2007-TIOL-152-HC-P H-CUS wherein it has been held that the Commissioner (Appeals) did not have power to remand the case, CESTAT vide order No.. 451/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order. 5. Heard the parties and considered the submissions. 6. We find that the facts of the case are not in dispute that the cost of raw material supplied to the appellant by GSK were provisionally assessed and the appellant also paid duty provisionally. Later on, the actual value of goods cleared by the GSK was ascertained and the said value was adopted by the appellant for finalisation of their assessment. In that circumstances, the provision of Rule 8 are not applicable for the valuation of goods cleared by GSK for supplying the raw material to the appellant. 7. In fact, when the actual sale price is available, in that circumstances, the provisions of Rule 8 are not applicable. The same view was taken by the Larger Bench by this Tribunal in the case of ITC ltd. wherein this Tribunal observed as under: Valuation (Central Excise) - Inter-unit transfer of goods for captive consumption - Stock transfer without any sale - Cost of production of such raw material for determining cost of production of goods manufactured by transferee unit - HELD : Itis actual cost of production of raw materials, computed strictly in terms of CAS-4 as mandated by C.B.E. C. Circular No.69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it may. As is clear from the analyses recorded in para 6.1 of the TISCO ruling, the learned Division Bench fell into a clear analytical error. After extracting Rule 8 of the Valuation Rules, the learned Division Bench observes that the value of goods cleared for captive consumption shall be115%/110% of the cost of production of such goods. This inference is correct since the Mumbai unit was clearing wire rods to its own unit at Borivali for captive consumption for manufacture of goods by the later unit. Rule 8 is thus applicable for valuation of the goods manufactured by Mumbai unit, for remittance of Excise duty. The next sentence in the judgement is a non-sequitor. It states that the rule does not envisage notional profit of 15%/10%. Rule 8 applies and does require loading of15%/10% on the cost of production of wire rods by the Mumbai unit since these goods are supplied to the TISCO s Borivelli unit for captive consumption thereat. The third sentence in the extracted sub paragraph of para 6.1 records conclusions without explaining the rationale therefor. This sentence reads therefore, the cost of billets at Tarapur unit would be 115%/110% of the cost of production of billets . T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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