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TMI Blog2001 (7) TMI 479X X X X Extracts X X X X X X X X Extracts X X X X ..... luation Rules based upon the cost construction method. Originally, dispute also arose as regards the inclusion of the input duty credit availed as Modvat credit on the raw material which has been set at rest by the order of the Commissioner of Central Excise. As such the only dispute which survives in the present appeal is the inclusion of depreciation charges and indirect overhead charges in the assessable value of the slides. 2. The appellants contention duly represented by Dr. Samir Chakraborty, ld. Advocate is that the depreciation and indirect overhead should not be taken into account for determining the value of slides based on the Accounting Standard, AS 6 issued by the Institute of Chartered Accountants of India. As per this depr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of two factors viz. usage and lapse of time both of which may also operate simultaneously. In the reply, the assessee has laid emphasis/stress only on deterioration, obsolescence etc., whereas primarily depreciation takes place on account of usage. In financial accounts, depreciation is provided against profits for the purpose of replacement of a fixed asset, when need arises. It is no doubt an allowance made in Book Keeping and financial accounting for the decrease in the value of property. However, in cost accounts, the charge for depreciation is taken as the cost of utilising the fixed assets for the purpose of production. Production should be charged with the diminution in the value of the machine through use, the other elements wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner, depreciation is relatable to the fixed assets, which in turn are relatable to the production of the product. As such, we are of the view that the depreciation claimed by the appellants would become a part of the cost of assessable value. However, the appellants have taken a definite stand that the machinery used in the manufacture of slides was fully depreciated and no depreciation as such was being claimed by them, in which case the question of addition of depreciation does not arise. The above contention of the appellants has not been considered by the Assistant Commissioner from this angle. If the same is correct, we are of the view that the depreciation would not form a part of the assessable value of the slides. The Assis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rouped as indirect overhead of the primary manufacturing department should also be apportioned on a suitable basis to arrive at the cost of production of the captively consumed products. On going through the above paragraph of the Order-in-Original, we fully agree with the findings arrived at. 7. It is also seen that the Tribunal in the case of Hindustan Tyres Ltd. v. Commr. of Central Excise reported in 1988 (34) E.L.T. 324 (Tribunal) has held that administrative overheads relating to manufacture of the other goods are not includable while determining the value of goods captively consumed. This shows that the administrative overhead expenses relatable to the captively consumed goods are required to be added in the assessable value of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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