9911796707
TMI Blog2018 (7) TMI 1519X X X X Extracts X X X X X X X X Extracts X X X X ..... radesh Southern Power Distribution Company (APSPDCL), Tirupati for conversion of Low Voltage Distribution System into High Voltage Distribution System in certain feeders in Rajampeta division of Kadapa operation/circle, APSPDCL, Kadapa. As per the terms and conditions of the contract, the appellant had to procure all the raw material required for execution of such conversion and to complete the work; one of the main aspect of such works is supply, Erection and Commissioning of 16/25/KVA. The rate quoted by the appellant is inclusive of material and also taxes and duties. Since the appellants are manufacturing the transformers, they have arrived at the cost of 16/25 KVA cleared after considering the deductions like Vat, Cost of Mounting Arra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .)] wherein, the appeals filed by the Revenue were dismissed and discharge of duty liability under the Provisions of Rule 8 of the Valuation Rules were upheld; same is the view expressed by the Bench in the case of Indian Hume Pipe Co. Ltd., [2015 (321) ELT (460) (Tri. - Chennai)]. It is his further submission that acceptance of CAS-4 certificate was upheld by the Tribunal in their own case in respect of Transformers supplied for turnkey project and (as reported at [2014 (304) ELT 100 (Tri. - Bang.)]. He would submit that the impugned order is set aside and the appeal be allowed. 4. The Learned Departmental Representative on the other hand, draws our attention to the findings recorded by the First Appellate Authority. It is his submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action value. 7. The factual matrix of the case as recorded by First Appellate Authority is as under: "9. It is observed that in respect of the DTRs cleared during the months of March, 2008 to April, 2008, the appellants have adopted the basic values of Rs. 37,009.64 for 16 KVA and Rs. 48,581.44 for 25 KVA, arrived by them and quoted in the Contract agreement with APSPDCL. For the months of May, 2008 and June, 2008, they have adopted the basic values of Rs. 34,526.15 and Rs. 44,261.15 for 16 and 25 KVA DTRs respectively basing on the certification of the Chartered Accountant. However, it is noticed the appellants have collected the prices from APSPDCL basing on the prices quoted by them in their contract agreement dated 18.06.2007. The de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alue of the transformer was Rs. 34,526.78 for 16 KVA and Rs. 44,261.68 for 25 KVA transformer. From the records, it is seen that the appellant had cleared the 16 KVA transformers at the assessable value of Rs. 37,009.64 and 25 KVA at the assessable value of Rs. 48,581.44 discharging both the transformers. The evidences in respect of the same are in the form of invoice which is as reproduced: It can be seen from the above reproduced invoice and the Chartered Accountant Certificate, appellant had discharge the Central Excise duty at the higher assessable value then as certified by the Chartered Accountant. We find that in the appellant's own case, the Tribunal had recorded the following finding which accepts that the Central Excise liability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrive at the assessable value by including the quantum of oil indicated as required in the contract cannot be sustained. Even if it is for captive consumption or use, there is no basis to include the freight element from the factory to site. There is no indication as to why the factory gate cannot be considered incurred from the place of removal in this case and why the freight involved in transportation of transformers from the factory gate to the sites should not be considered as cost of turnkey project rather than the cost of manufacture. Thus, we find that important statutory aspects regarding limitation as well as reasons for inclusion of elements of cost have not been given and hence cannot be sustained. In these circumstances, we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Valuation Rules, 2000. If we go through the Valuation Rules sequentially, we find that in terms of Rule 11 most appropriately Rule 8 is applicable which prescribed the valuation of cost construction method at the rate of 115% of the cost of manufacturing. The respondent have valued the goods as per Rule 8, the computation of the value on the basis of Rule 8 was not disputed by the Revenue what is disputed is that only freight charges should be added in the value which was arrived at in terms of Rule 8. On a plain reading of Rule 8 it is clear that the value should be 115% of the cost of manufacture of the product. The provision does not provide to add any elements over and above the 115% of the cost of manufacture. Therefore addition of fre ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
