9911796707
TMI Blog1998 (5) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,100/- per kg. Lateron, since the stock at Bombay and Calcutta Mint got depleted, they started supplying life expired silver oxide batteries available with them to the appellants for recovery of silver and for being used in the manufacture of new silver oxide batteries. In the contract entered into by the assessee with the Ministry of Defence, the cost of silver recovered from the life expired battery was fixed at Rs. 2,500/- and the contract price for the battery was arrived at the above terms. It was noted that if such silver supplied was not sufficient, the assessee were required to obtain silver from the market at the market rate and accordingly the price of silver purchased from the market was based on the market value. The assessee filed the price list under Part-II and got approved for the above contract price. However, lateron the Superintendent issued a show cause notice alleging that the price of silver had been reduced in order to suppress the assessable value of the batteries and without indicating under what provisions of law the assessable value is to be enhanced but merely alleged a short levy on the basis of difference between the market value of silver and value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and hence the cost of silver as prevalent in the market at the time of clearance of the said batteries should only be taken into consideration for arriving at the assessable value of the batteries. It is stated that the assessees had arrived at the cost price of the subject goods based on silver price at mint rate and not on the basis of silver prevalent in the market. When the sale price of the goods is not sole consideration of the sale excisable goods and there is some additional consideration flowing directly or indirectly from the Defence to the assessee either in cash or in other form as per the Rule 5 of the Central Excise (Valuation) Rules, 1975 such additional consideration quantified in terms of money value to be added to the price declared by the assessees for determining the assessable value of such goods. Therefore, they state that the price of silver should be on par with the market price and not Rs. 2,500/- as claimed by the assessee even though there is a contract between these two parties. 5. Arguing for the appellants, the ld. SDR pressed these grounds and relied on the Tribunal s judgment on identical case as reported in the case of HBL Aircraft Batteries Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ference in the purity and quality of the silver and both the silver recovered from the battery and the one sold in the bullion market cannot be compared. In any event of the matter, the price fixed for silver by the Ministry of Defence is not the price of a similar silver in the market. Therefore, there is a ground for holding that there is no normal price in the present case for the batteries in terms of Section 4(1)(a) which reads along with Section 4(1) as follows : 4. Valuation of excisable goods for purposes of charging of duty of excise. - (1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to value, such value shall, subject to the other provisions of this section, be deemed to be - (a) the normal price thereof, that is to say, the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale : Where under this act the duty of excise is chargeable on any excisable goods with reference to value, such value, shall, subject to other provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etermine in terms of the prescribed rules. The department should also permit them to make deductions in regard to cost of transportation as laid down in Section 4(2). 11. The department while being justified to proceed to determine the nearest ascertainable equivalent of the silver price, cannot suddenly adopt the bullion price, as they have to find out the prevailing price of silver sold in the market while arriving at the assessable value of the Battery. In case if the same is not available, they have to proceed to the procedure laid down in the Central Excise (Valuation) Rules, 1975. 12. Rule 4 lays down that the value of excisable goods shall be based on the value of such goods sold by the assessee for delivery at any other time nearest to the time of removal of goods under assessment subject, if necessary, to such adjustment on account of the difference in the dates of delivery of such goods and of the excisable goods under assessment as may appear reasonable to the proper officer. In terms of this rule it is seen that 7% of the goods are sold by the assessee to HAL. We have to see as to whether the assessee used the same silver as recovered from the battery and they have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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