TMI Blog2005 (3) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... imposed penalties. Out of this, demand of Rs. 18.54 lakhs has been confirmed in regard to 'lagging sheets' manufactured and cleared for exclusive use in servicing. It is pointed out by the learned Counsel that the assessee had been paying duty (correctly) by treating the cost of production of lagging sheets as the assessable value. The impugned order has demanded differential duty by treating the entire realisation from servicing along with 10% of such billing towards profit as assessable value. The further contention of the learned Counsel is that the Board has issued a Circular dated 13-2-2003 in regard to valuation of captively consumed goods. The circular had specifically ordered valuation according to CAS-4 valuation standard developed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S-4. We remand this aspect of the matter to the original authority for a fresh decision in terms of CAS-4. 4.The next issue in dispute is with regard to liability to pay duty in respect of solution which they had imported/purchased in bulk and re-packed. The solutions in question are classifiable under Tariff heading 35 and Chapter note 3 to that Chapter makes it clear that packing and re-packing is dutiable. The only point being made in regard to this issue is that the demand is barred by limitation, inasmuch as the appellants' processes did not attract duty in view of the clarification vide Circular No. V/28/30/3/97 CX-1, dated 20-5-97. It is being pointed out that the Circular clarified that chapter notes will not be applicable if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issue. The Commissioner's order has been passed over looking the order of the Deputy Commissioner. Therefore, this demand cannot be sustained. We set aside the demand. 6.The learned Counsel has submitted that penalty of Rs. 1.4 crores has been imposed on the manufacturers and penalty of Rs. 15,00,000/- each has also been imposed on the four functionaries of the appellant-manufacturer. The contention of the appellant is that penalties are not justified inasmuch as the dispute basically is legal in character and in any event the directors had no personal liability. We find that penalty on the Directors is not justified at all inasmuch as no individual personal guilt is involved. Therefore, those penalties are set aside. The position of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the evidence on record shows that the appellant had constructed one system in their own factory. The assessee has explained that this activity was carried on experimental basis and that they had brought on record that the experiment had failed. In any event, it was only part of product development and not manufacture. It is not in dispute that most of the system in question came into existence only on erection at site and there was no prior manufacture in the assessee's factory. No duty is attracted in the erection of such system on location. In the facts of the case, the order is correct and does not call for any intervention. 8.Another point raised in the Revenue's appeal is that the appellant buys the conveyer belting in endless le ..... X X X X Extracts X X X X X X X X Extracts X X X X
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