2018 (11) TMI 1752 - AT - Central Excise

Short levy of central excise duty - appellants have been fabricating the tipper bodies for original equipment manufacturers like M/s Tata Motors Ltd. and M/s Ashok Leyland Ltd., on the duty paid chassis is supplied to the appellant by the OEM manufacturers - Rule 10A of Central Excise Valuation Rules (Determination of Price of Excisable Rules, 2000) - HELD THAT - This issue has already been decided by this Tribunal in the case of the appellant himself in M/S COMMERCIAL ENGINEERS BODY BUILDERS PVT. LTD. VERSUS CCE, JABALPUR 2018 (10) TMI 456 - CESTAT NEW DELHI where the matter was remanded back for reconsideration. Appeal allowed by way of remand.

Summary

Issues:
- Application of Rule 10A of Central Excise Valuation Rules
- Determination of central excise duty on motor vehicles
- Interpretation of job work provisions
- Compliance with Valuation Rules of Central Excise Act

Application of Rule 10A of Central Excise Valuation Rules:
The appellant, engaged in fabricating motor vehicle bodies, faced allegations of not following Rule 10A procedures for motor vehicles cleared to OEMs. Show cause notices demanded central excise duty for non-compliance. The Assistant Commissioner confirmed the duty and interest, upheld by the Commissioner (Appeals). The appellant argued that Rule 10A did not apply as they procured all raw materials themselves, not supplied by the OEMs. They cited a Tribunal order in a similar case. The Tribunal remanded the matter, directing to recompute duty without penalty, considering non-inclusion of taxes in assessable value.

Determination of central excise duty on motor vehicles:
The dispute centered around the correct valuation of motor vehicles fabricated by the appellant for OEMs. The department alleged a short levy of central excise duty due to non-compliance with Rule 10A procedures. The appellant contended that they should be allowed cum-duty benefit and VAT deduction under Valuation Rules. The Tribunal referred to previous orders involving the same appellant, which directed a reevaluation of duty without penalties, considering the non-inclusion of taxes in assessable value.

Interpretation of job work provisions:
The appellant argued that their fabrication activity did not constitute job work as they procured raw materials independently, not supplied by the OEMs. They contended that Rule 10A, defining job workers as those manufacturing goods from inputs supplied by the principal manufacturer, did not apply in their case. They challenged the Commissioner (Appeals) reliance on a previous Tribunal decision, asserting factual differences. The Tribunal remanded the matter, following earlier orders involving the same appellant.

Compliance with Valuation Rules of Central Excise Act:
The appellant raised concerns regarding the application of Valuation Rules of the Central Excise Act, particularly claiming entitlement to cum-duty benefit and VAT deduction. They argued that the provisions should be applied in their case. The Tribunal, citing previous orders involving the same appellant, directed a reevaluation of duty without penalties, considering the non-inclusion of taxes in assessable value. The matter was remanded back to the adjudicating authority for further consideration in line with the Tribunal's directions.