2015 (12) TMI 1353 - AT - Central Excise

Valuation - clearance of goods to own sister concern - inclusion of selling and distribution of expenses and expenses incurred by the corporate office at Nashik during the period October 1997 to June 2000 - Held that - Issue is no more res integra inasmuch as in the recipient s own case for the earlier period, this Bench on an appeal filed by Revenue on identical issue, held that the provisions of CAS-4 will apply not only prospectively but also for the period prior to issue of Board s Circular dated 13.02.2003 - impugned order is correct and legal and does not suffer from any infirmity. - Decided in favour of assessee.

Summary

Issues involved:
1. Valuation of assessable value for Central Excise duty including selling and distribution expenses and corporate office expenses.
2. Applicability of CAS-4 guidelines retrospectively.
3. Interpretation of CBEC Circular dated 13.2.2003.

Detailed Analysis:
Issue 1: The main issue in this case pertains to the valuation of assessable value for Central Excise duty, specifically regarding the inclusion of selling and distribution expenses and corporate office expenses incurred during a specific period. The Revenue contended that these expenses should be included in the assessable value to discharge the duty liability. However, the first appellate authority upheld the assessee's valuation method, stating it was in line with the standards set by CAS-4.

Issue 2: The Tribunal noted that the issue of including expenses in the assessable value is not new, as a similar matter was previously adjudicated upon. In the earlier case, it was established that CAS-4 guidelines, which specify the components that can be included in the cost of production, apply not only prospectively but also for periods before the issuance of the relevant Circular. The Tribunal referenced the relevant paragraphs from the earlier case to support this conclusion.

Issue 3: The argument presented by the Revenue centered on the retrospective application of the CBEC Circular dated 13.2.2003. The contention was that prior to this Circular, expenses such as head office administrative expenses, interest charges, and selling and distribution expenses should be included in the assessable value based on a Circular from 13.10.96. The Tribunal, however, upheld the impugned order, stating that the Circular from 13.2.2003 should be applied retrospectively, and therefore, the expenses in question need not be included in the assessable value.

In conclusion, the Tribunal found the impugned order to be legally sound and free from any defects. The appeal by the Revenue was deemed meritless, and the Cross Objection filed by the respondent was also disposed of accordingly. The decision was based on the proper interpretation of CAS-4 guidelines and the retrospective application of relevant Circulars, ensuring consistency in the valuation of assessable value for Central Excise duty.