9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (9) TMI 1474 - AT - Central ExciseValuation - inclusion of selling cost, marketing cost, administrative expenses and advertisement expenses in the value adopted for cost of production - appellant referred to the provisons of CAS-4 which has been accepted by the Revenue - Demand of differential duty and imposition of penalty - utilization of CENVAT Credit in case of excisable semi-finished goods - condition is revenue neutral and the assessee has paid the amount demanded prior to show-cause notice - Held that - the penalty amount is set aside, as the issue is interpretational in nature. The demand of differential duty is also set aside and the matter is remanded for re-determination of duty by the learned Commissioner, who shall re-determine the duty liability as per CAS-4 costing standards. Valuation - manufacture of ADV tyres and captively consumed - not entitled for exemption under Notification No. 67/95-CX dated 16.3.1995 - ADV tyres are cleared at Nil rate of duty under Notification No. 6/2000 dated 1.3.2000 - whether valuation had to be in accordance with Rule 8 of the Valuation Rules, 2000 - duty paid under protest - Demand of differential duty and imposition of penalty - Held that - the whole issue is interpretational and the matter can be considered in view of the similar earlier decisions of the Tribunal and the Hon ble Supreme Court in the case of Commissioner of Central Excise Vs. Cadbury India Ltd. 2006 (8) TMI 2 - SUPREME COURT OF INDIA . The penalty amount is set aside as the issue is revenue neutral and also in view of the fact that the appellant has deposited the amount of duty before issue of show-cause notice. - Appeal allowed by way of remand
Issues:
1. Dispute regarding valuation of products for captive consumption. 2. Imposition of differential duty, interest, and penalty. 3. Inclusion of various expenses in the cost of production. 4. Application of CAS-4 costing standards for determining duty liability. Analysis: Issue 1: Dispute regarding valuation of products for captive consumption The assessee, a tyre manufacturer, appealed against an Order-in-Original dated 27.2.2007, which demanded a differential duty of &8377; 43,45,022/- for the period July, 2000 to December, 2000. The dispute arose from the Revenue's contention that the value of products for captive consumption should be 115% of the cost of production, as per the new Valuation Rules. Another issue involved the captively consumed goods not being entitled to exemption under certain notifications. The appellant contested these claims, leading to a second round of litigation. Issue 2: Imposition of differential duty, interest, and penalty In the earlier round, the Tribunal remanded the matter to the Commissioner for fresh adjudication. The Commissioner imposed a penalty of &8377; 10 lakhs under Rule 173Q of Central Excise Rules, 1944, and confirmed the differential duty along with interest. The appellant challenged this decision, arguing that the penalty was unjustified and the differential duty calculation was incorrect. The Tribunal found the issue to be interpretational and set aside the penalty, remanding the matter for re-determination of duty as per CAS-4 costing standards. Issue 3: Inclusion of various expenses in the cost of production The appellant contended that the Commissioner erred in including selling cost, marketing cost, administrative expenses, and advertisement expenses in the cost of production. The appellant argued that these expenses should not be part of the valuation as per costing standards. Citing relevant case laws and circulars, the appellant urged that selling and marketing expenses should not be considered in the cost of production. Issue 4: Application of CAS-4 costing standards for determining duty liability The Tribunal directed the appellant to appear before the Commissioner with the working of cost as per CAS-4 standards within 8 weeks for re-determination of duty liability. The Tribunal emphasized the need for the Commissioner to pass a reasoned order based on CAS-4 costing standards, considering the interpretational nature of the issue. In conclusion, the Tribunal set aside the penalty, remanded the matter for re-determination of duty, and directed the application of CAS-4 costing standards for resolving the valuation dispute.
|
