2004 (4) TMI 352 - AT - Central Excise

Summary

Issues:
Assessable value determination including bought-out items for manufactured goods.

Analysis:
The case involved a dispute regarding the assessable value of Piston & G. Pin manufactured by the respondent, which included Circlips and Rings purchased separately. The Central Excise authority argued that the value of these additional items should be included in the assessable value of the manufactured goods. However, the respondent contended that these items were merely accessories and should not be considered in the valuation.

The Commissioner (Appeals) referred to a previous decision by the Tribunal in the case of India Piston Ltd. and the Supreme Court ruling in Sri Ram Bearings Ltd. v. CCE, which supported the view that the cost of accessories should not be included in the assessable value of excisable goods. Consequently, the appeal of the respondent was allowed based on these precedents.

The Revenue appealed this decision, arguing that under Rule 2(a) of the Rules for Interpretation of the Schedule, goods removed in unassembled condition should be considered part of the assembly. They also relied on a Tribunal decision in Nichrome Metal Works v. CCE, Pune, which stated that the value of bought-out items supplied along with machines should be included in the assessable value.

Upon review, the Tribunal found no merit in the Revenue's appeal. They clarified that the heading covering the parts in question did not extend to assemblies. Additionally, they highlighted that the previous decision in Nichrome Metal Works was based on specific factual findings regarding the nature of the bought-out items, which differed from the current case.

The Tribunal emphasized that the Circlips and Rings were not integral parts of the Piston and G. Pin but were separate items required for assembly. As such, the cost of these items should not be included in the assessable value of the manufactured goods. The Tribunal upheld the decision of the Commissioner (Appeals) and rejected the Revenue's appeal, concluding that there was no merit in the case.