2001 (12) TMI 829 - AT - Central Excise

Summary

Issues:
Assessable value of molasses captively consumed by appellants.

Detailed Analysis:
The appeals before the Appellate Tribunal CEGAT, Mumbai revolved around the assessable value of molasses captively consumed by the appellants. Each appellant had declared a certain price per ton for the molasses consumed, while the department contended for higher prices ranging from Rs. 1300 to Rs. 1965 per ton. The department based its action on the prices at which the Western Maharashtra Development Corporation (WMDC) purchased the goods for supply to distilleries run by the government. The appellants argued that the prices recommended by the Chief Minister's committee or determined under Rule 6(b)(ii) should be applied. They also raised concerns about the different grades of molasses purchased by WMDC on different dates. However, the Tribunal noted that there was no evidence of any statutory price fixed for molasses during the relevant period, and even the Chief Minister's committee recommendation did not hold as a statutory price.

The Tribunal referred to a previous decision where it was established that the price at which WMDC purchased molasses could not be considered the valid value since WMDC was not the manufacturer. Instead, the Tribunal suggested considering the price at which a manufacturer geographically close to the factory, whose appeal was under consideration, sold molasses as the basis for determining value. The departmental representative argued that unless it could be proven that the price applied from WMDC was not the actual price paid to the sugar mill, the fact that WMDC was not a producer would not be relevant. The Tribunal agreed with this argument, emphasizing the geographical proximity of all appellants to WMDC located in the same district.

Regarding the contention that WMDC prices were quoted for different grades of molasses, the Tribunal found a lack of evidence to substantiate this claim. The appellants also cited a previous Tribunal decision where a specific price per ton was applied, but the Tribunal dismissed this claim due to insufficient substantiation. Ultimately, the appeals were dismissed by the Tribunal.