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TMI Blog1997 (9) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... em for job work purposes. The Learned lower authority has held that modvat element has to be added for arriving at the assessable value and inasmuch as the appellants had not done so, and the department had not been made aware of the same, there was an element of suppression longer period of limitation has been invoked. 2. The appellants have been asked to pay the duty amount of Rs. 5,96,454/- and penalty of the like amount has also been imposed under Section 11A of the Central Excise Act. 3. The learned Chartered Accountant for the appellants at the outset submitted that the learned lower adjudicating authority in spite of being pointed out that the issue was covered in favour of the assessee by the decision of the Larger Bench of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st of the material without the duty element. He has pleaded that this decision has been followed in subsequent decisions of the tribunal in the case of Jay Engineering Works reported in 1997 (93) E.L.T. 492 (Tribunal) = 1997 (19) R.L.T. 788 and also by the East Regional Bench in the case of Konark Television Ltd. reported in 1997 (22) R.L.T. 277. He has pleaded that the East Regional Bench have distinguished the ratio of the decision of Mysore Paper Mills Ltd. case while following the ratio of the Daiichi Karkaria case. 4. He has pleaded that the East Regional Bench in the case of Konark Television Ltd. has held at para 5 as under :- 5. We have carefully considered the pleas advanced from both sides. After having perused both the judge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ...if the manufacturer has utilised duty paid inputs for manufacturing the goods or has utilised the duty paid wrapping paper before delivery, no deduction before delivery already paid on the inputs can be allowed under Section 4(4)(d)(ii). The duty will have to be levied at the time of removing from the factory. We observe that the controversy in the Mysore Paper Mills case has no relevance in the facts of this case. It is only the duty on the T.V. sets in terms of Section 4(4)(d)(ii) has to be decided. This is what has actually been done by the respondents while submitting the price list. In other words, deduction of duty of Rs. 1675/- has been made from the sale price including duty of Rs. 6670/-. Hence the appeal of the Revenue is dism ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aluation Rules. It is observed that the Larger Bench of the Tribunal in the case of Daiichi Karkaria has clearly held in para-19 which is reported as under :- 19. It was on this logic that the old Rule 56A was interpreted by the Ministry of Finance by letter dated 25-9-1976 and by the Government in Union Carbide Ltd. case, 1982 E.L.T. 683. It is this logic which is the basis of the explanation offered by the Board in the guides referred to earlier. The speech of the Finance Minister and the other materials referred to earlier clearly indicate the mischief that was sought to be overcome and the object and purpose sought to be achieved by the scheme. The mischief sought to be remedied is, the cascading effect on taxation, the burden of duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has clearly held that for arriving at the assessable value under Rule 6(b)(ii), the Modvat element has to be excluded. In view of above, we hold prima facie that the appellants have a good case on merits and we allow the prayer for dispensation of the penalty and the amount demanded as duty. 10. Since the issue is squarely covered by the ratio of the decision of the tribunal, we take-up the appeal itself for disposal with consent of both the sides. We observe that in para-19 which has been relied on by the ld. Chartered Accountant in the case of Daiichi Karkaria the tribunal after analysing the position in regard to the purpose of Modvat has clearly held that for arriving at the assessable value in terms of Section 4(1)(b) under Valuati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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