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TMI Blog2023 (5) TMI 436X X X X Extracts X X X X X X X X Extracts X X X X ..... above said goods were either captively consumed within the factory at Haldia or cleared to their own sister unit at Barauni, on stock transfer basis and hence Rule 8 of the Central Excise Valuation Rules, 2000 is to be adopted for the purpose of determining the value of these goods. 2. The Appellant stated that in petroleum industry it is not possible to determine the cost of the product through the method prescribed under CAS-4, since the refinery is an integrated system wherein a single major input (Crude) is processed in multiple units to obtain around 20 different types of products which are further divided into various grades. Allocation of law material cost, direct labour and expenses for several grades of the product is practically ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and partly consumed captively, the goods sold would be assessed on the basis of 'transaction value' [provided they met the conditions of Sec 4(1)(a) and the goods captively consumed would be valued as per Rule 8 of the Valuation Rules. This is because, as per new section 4, transaction value has to be determined for each removal. Where goods are transferred to a sister unit or another unit of the same company valuation will be done as per the proviso to rule 9. 4. From the above clarification issued by Board, it is observed that Rule 8 of the Valuation Rules 2000 is applicable for valuation of goods consumed captively. The Ld Departmental Representative argued that since the Appellant has not adopted this method and paid duty accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ercise is revenue neutral and there is no loss of revenue to the exchequer. We find merit in the argument of revenue neutrality by the Appellants The duty paid by the refinery at Haldia is available as credit to the unit in Barauni. 7. Revenue has cited Board's Circular No.643/34/2002-CX dated 01.07.2002. Rule 11 will be applicable only when it is not possible to arrive at the valuation on the basis of any of the rules from Rule 4 to Rule 10A of the Valuation Rules 2000. In this case the Rule 8 is the appropriate method for determining the value of captively consumed SRGO/DHDS. The Revenue contended that the Appellant has not adopted this method and hence the valuation adopted by them is inappropriate. 8. We find that Valuation is to be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Hon'ble Supreme Court 2011 (267) ELT A155 S.C 9. We observe that the issue of Revenue Neutrality is a very valid argument in this case as the sister Unit at Barauni would be eligible for the credit of the duty paid by the Haldia Unit. The above said decisions cited by the Appellant are squarely applicable in this case. The facts and circumstances of the decision cited above in CCE&C, Vadodara II Vs Indeos ABS Ltd 2010 (254) ELT 628 Guj are same as that of the present case on hand. The gist of the decision cited above is reproduced below: Demand - Undervaluation - Revenue neutrality - Tribunal disposed of appeal holding that since goods cleared to sister concern, whatever duty payable available as credit to own unit (sister conc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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