2004 (12) TMI 600 - AT - Central Excise

Summary

Issues:
- Determination of assessable value of billets manufactured and cleared to another unit
- Invocability of extended period of limitation for demanding Central Excise duty

Analysis:

Issue 1: Determination of assessable value of billets
The case involved appeals filed by M/s. Vardhman Special Steels concerning the assessable value of billets manufactured and sent to another unit. The Appellant argued that comparing factory gate selling price with stock transfer price to another unit is not valid as no profit is involved in stock transfer. They contended that Rule 6 of the Central Excise (Valuation) Rules, 1975 does not apply. The Respondent countered, stating that if the normal price of the goods is available, they should be assessed under Section 4(1)(a) of the Central Excise Act. Referring to a Supreme Court case, the Respondent argued that the normal price is the price at which goods are sold in the market. The Tribunal agreed with the Respondent, emphasizing that the normal price at the factory gate should be considered for assessing duty on goods transferred to another unit.

Issue 2: Invocability of extended period of limitation
In one appeal, the Appellant claimed that the demand for duty was time-barred as they had filed a price declaration regarding transfer of goods to the other unit. They argued that the Revenue had not questioned the veracity of the declared price. The Respondent contended that the extended period of limitation was applicable as the Appellant did not declare charging a lower price to their own unit. The Tribunal noted that the lower authorities had not considered the Appellant's submission regarding the price declaration. They remanded the matter to the Adjudicating Authority to determine the invocability of the extended period of limitation based on the filed price declaration.

In conclusion, the Tribunal upheld the demand and penalty in one appeal as the duty demand was within the specified time limit. However, they allowed the second appeal for further examination by the Adjudicating Authority regarding the invocability of the extended period of limitation based on the price declaration filed by the Appellant.