9911796707
TMI Blog1988 (1) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... standard length with PVC plug attached thereto in moulded form. The balance wire in the form of small cut pieces left after manufacture of standard cords were returned to the customers along with the finished products. The cords are assessed by the department under Tariff Item 68 and no objection has been taken thereto by the respondent company herein. 2. The respondent company after crossing clearance value of Rs. 12 lakhs applied for L-4 licence and after crossing clearances worth Rs. 15 lakhs started paying Central Excise duty. The jurisdictional Superintendent, however, noted that the respondents had not taken into account the raw material value in computing the exemption limit for the purpose of Notification 89/79, dated 1-3-1979. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be taken into account for the purpose of such computation of exemption limit. In deciding the above short point the lower authorities have gone into another incidental question whether the benefit of Notification 119/75 was applicable to the manufacture of mainscords from PVC wires received as raw materials by the respondent company. This question in our view is not necessary to be gone into in deciding the issue referred to earlier. Question whether the benefit of Notification No. 119/75 is available to the main cords manufactured by the respondent company is not an issue in the show cause notice dated 13-11-1980 copy available on record. In view of this factual position in the instant case it is not necessary for us to go into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pra relied upon by the respondent company herein. On the essential question involved in this case i.e. the computation of exemption limit in terms of Notification 89/79 the respondent company has relied on the judgment of Bombay High Court in the case of Narendra Engg. Works v. Union of India [1981 (8) E.L.T. 859]. In this judgment Division Bench of Bombay High Court, relying on Supreme Court s observation in Voltas case that the real value of the goods is the manufacturing cost and the manufacturing profit has held that the cost incurred by the petitioners in manufacturing the rods does not include the cost of the raw material. We do not see how the Excise authorities can justify in the face of the Voltas judgment, taking the value of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 4 of the Act. The value would naturally include the value of grey fabrics supplied to the independent processors for the processing. Notification 89/79 is an independent notification and it stipulates that clearances of excisable goods under Item 68 beyond the value of Rs. 15 lakhs would be liable to 4% rate of duty upto the value of Rs. 30 lakhs in a financial year. Since the value has not been defined in the notification, value for this purpose has to be in accordance with Section 4 of the Act because the value in the instant case in terms of Notification 89/79 is for the purpose of assessment which term would include application of an exemption notification (notification 89/79 in the instant case). In view of the foregoing discussio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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