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2018 (7) TMI 1588 - AT - Central ExciseMethod of Valuation - clearance of paints manufactured - Rule 8 of Central Excise Valuation Rules or under Rule 11 of Central Excise Valuation rules? - Held that - Identical issue decided in appellant own case M/S COROMANDEL PAINTS LTD. VERSUS CCE & CC, VISAKHAPATNAM 2016 (6) TMI 1018 - CESTAT HYDERABAD , where it was held that the value adopted by the appellants under Rule 8 of the Central Excise (Determination of price of Excisable goods) Rules, 2000 was not in order and that since the application of paint contains labour costs, the assessable value is to be determined under Rule 11 only after deduction of the value of labour component from the total value for supply and apply. The demand of the duty liability needs to be upheld along with interest, but the penalties need to be set aside - appeal allowed in part.
Issues:
Central excise duty liability calculation method under rule 8 vs. rule 11 of Central Excise Valuation Rules. Analysis: The appeals were directed against an Order-in-Appeal dated 22.01.2009 and 17.03.2009. The appellant, a manufacturer of paints and varnishes engaged in painting contracts, calculated duty liability based on the cost construction method. The Revenue argued that the correct rule for valuation should be rule 11 of Central Excise Valuation Rules, which requires deduction of labor charges from the contract value. Both lower authorities ruled against the appellant. The appellant's counsel highlighted a previous order by the same bench in the appellant's favor, where penalties were set aside. The Revenue cited another order in the appellant's case where demand and interest were upheld, but penalties were set aside. Upon review, the Tribunal found the issue to be the same as in the previous orders. Following the precedent, the Tribunal upheld the duty liability demand and interest but set aside the penalties. In conclusion, the Tribunal partly rejected and partly allowed the appeals, upholding the duty liability demand and interest while setting aside the penalties.
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