2008 (7) TMI 800 - AT - Central Excise

Summary

Issues: Valuation of captively consumed raw materials, Modvat credit consideration, imposition of penalty under Rule 173Q.

Valuation of captively consumed raw materials:
The case involved a dispute regarding the valuation of captively consumed raw materials, specifically "expanded polysheet laminated with PVC Jute mat." The adjudicating authority had determined the assessable value by considering the cost of raw materials and adding notional profit, without factoring in the Modvat credit available to the assessee on the inputs. The Commissioner (Appeals) upheld the authority's decision. The Revenue challenged the calculation method, while the assessee contested the penalty imposition.

Modvat credit consideration:
The learned Counsel representing the assessee accepted the assessable value arrived at by the authority. The penalty imposed under Rule 173Q was deemed unwarranted as the assessee had been transparent in declaring prices to the authorities. The Revenue's appeal focused on disputing the method of arriving at the assessable value for captively consumed materials, without challenging the Order-in-Original.

Imposition of penalty under Rule 173Q:
The Tribunal found the Revenue's appeal baseless as they had not challenged the Order-in-Original, leading to the dismissal of the appeal. Regarding the assessee's appeal, since the assessable value had been accepted and Modvat credit on inputs considered, the appeal against the valuation did not stand, resulting in its dismissal. The penalty imposed on the appellant was deemed unjustified and was set aside, allowing the appeal with consequential relief.

In conclusion, all appeals were disposed of based on the above analysis, with the Tribunal dismissing the Revenue's appeal and granting relief to the appellant concerning the penalty imposition.