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TMI Blog1999 (9) TMI 582X X X X Extracts X X X X X X X X Extracts X X X X ..... tage. Both sides agreeing, this was done. 2. We have heard Shri C.S. Lodha, Advocate for the appellants and Shri K.L. Ramteke, for the revenue. The appellants manufactured Bilprol on job work basis for M/s. B.A.S.F. where the inputs were supplied to the appellants by M/s. B.A.S.F. from 1987, the assessees were filing the price lists for these goods, in Part VII on the ground that the goods were not sold. The basis of valuation was the cost of raw materials, plus the cost of processing. Along with the price lists, the cost of construction statement was enclosed duly certified by a firm of Chartered Accountants. In the certificate the following remark was put by the Chartered Accountants. The above cost of Rs. /- shown in the Col ... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period. The assessees cited the Tribunal judgment in the case of Dai Ichi Karkaria Ltd. v. CCE, Pune, 1996 (81) E.L.T. 676 wherein it is laid down that the excise duty paid on input raw materials for which Modvat credit has been taken could not be included when computing the cost of intermediate product used for captive consumption in terms of Rule 6(b)(ii) of Central Excise (Valuation) Rules, 1975. The Commissioner held that the ratio of this judgment did not hold the field in the light of two judgments of the Supreme Court viz. in the case of Kirloskar Brothers Ltd. v. UOI, 1992 (59) E.L.T. 3 (S.C.) and CCE, Bangalore v. Mysore Paper Mills Ltd., 1997 (92) E.L.T. 300. Both on merits and on limitation he upheld the charges, confirmed the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me appellant on the same issue. This judgment is sought to be distinguished by citing the judgments of the Supreme Court in the case of Mysore Paper Mills (supra) as well as in the case of Kirloskar Brothers. These two judgments of the Supreme Court, were on the issue as to which duty of Excise could be claimed for reduction in terms of Section 4 (4)(d)(ii) of the Central Excise Act, 1944. In identical orders, the Supreme Court held that what was deductible was the duty leviable on the final product concerned in the valuation and not the duty of excise paid on the inputs and used in the production of such final products. The Commissioner has taken the ratio of these two Supreme Court judgments as negating the ratio of Dai Ichi Karkaria Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise duty paid on the raw materials could be ascertained they would certainly recover the same in the form of duty and not by way of cost of the material. The plea for deduction of the amount of excise duty paid on the electric motor while arriving at the assessable value of pumps was, however, rejected. The Court took note of the explanation in Section 4 that in determining the price of any article thereunder, no abatement or deduction shall be allowed except in respect of trade discount and the amount of duty payable at the time of removal of the article chargeable with duty and held that it would be clear from the explanation itself that, while computing the assessable value, the deduction has to be allowed of the amount of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated by the Union Finance Minister in his Budget Speech of 28-2-1986 while presenting the Finance Bill, 1986 in which the Modvat scheme was introduced as also the clarifications issued by the Central Board of Excise Customs in the matter which have been referred to and considered in the decision of the Larger Bench of the Tribunal in the Dai Ichi Karkaria case referred to earlier which had been cited by the appellant s Consultant in support of the appeal. That decision on the valuation of goods under Section 4(2) of the Act and Rule 6(b)(ii) of the Valuation Rules is applicable in the present case and accordingly we hold that the duty paid on inputs availed as Modvat credit is not includible in the value of the input for computing the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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