TMI Blog2001 (7) TMI 169X X X X Extracts X X X X X X X X Extracts X X X X ..... n the manufacture of agricultural tractors; that the assessments were finalised by the Commissioner on the basis of Cost Certificate and the profit made by them on their main stream activity of manufacture and sale of tractors, that subsequently four show cause notices were issued to them for demanding duty on the ground that the profit was arrived at after providing for selling and distribution expenses, from the total turnover of the company; that the Assistant Commissioner confirmed the demand of duty which has been upheld by the Commissioner (Appeals), under the impugned grounds, holding that once the various selling and distribution expenses had not been included in the cost of manufacture, the question of claiming any deduction on tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present matters the department had taken the profit margin earned on the sale of the tractors without making any adjustments whatsoever and added to the cost of manufacture of intermediate goods; that considering the ratio of these two cases, the department should have applied a lower profit margin than what has been applied for arriving at the assessable value of the intermediate goods; that thus no further addition is required to be made to the value of the goods; that as held by the Tribunal in Hind Lever Chemicals Ltd. v. C.C.E. [2001 (130) E.L.T. 82 (T) = 2001 (43) RLT 600, cost of transportation from the factory of manufacture to the factory of consumption of the same manufacture is not to be included in the value of goods determ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... more duty of excise. 5. We have considered the submissions of both the sides. The facts which are not in dispute are that the appellants manufacture I.C. Engines in their factory at Alwar. These engines are cleared to their factory at Faridabad where these are used in the manufacture of agricultural tractors. The Assistant Commissioner issued four notices to the appellants on the ground that as they did not include the proportionate expenditure on selling and distribution expenses in the cost, the percentage of profit should have been worked out excluding selling and distribution expenses from the expenditure and demand of duty was made as adopting of lesser percentage of profit has resulted in short payment of duty. It is thus apparent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for working out the margin of profit for I.C. Engines. The Revenue is missing the point that the appellants are not selling I.C. Engines manufactured by them at all and they are working out the margin of profit on the sale of their final product and the said margin of profit is being added while determining the assessable value of the I.C. Engines in terms of Rule 6(b)(ii) of the Valuation Rules. The Revenue has not brought any evidence on record nor they have alleged that as far as the final product is concerned, the working out of margin of profit is wrong or net according to the settled principles of accountancy. Similar views were expressed by the Tribunal in Lucas TVS Limited case, 1998 (101) E.L.T. 662 by observing as under :- "The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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