9911796707
TMI Blog2001 (3) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 1-11-1996 was issued. The observation was made therein that to two other factories, the assessees had sold molasses at Rs. 250/- PMT. Differential duty of Rs. 2,09,887/- was demanded on the allegation that the correct price was Rs. 250/- PMT. The Assistant Commissioner after hearing the assessees held as follows :- I have carefully gone through the records of the case. I find that there is nothing to show that the sale of molasses to M/s. Ganesh SSK Ltd. and M/s. WMDC, Chitali during April, 1996 was not the normal commercial transaction. There is nothing on record to establish that M/s. Ganesh SSK Ltd. and WMDC, Chitali are related persons of the assessee or that the price was not the sole consideration for the sale of molasses. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per MT, a substantial basis exists for questioning these prices as normal prices arrived at arm s length without any extra commercial consideration. In circumstances when a reasonable basis exists for discarding the prices claimed as normal price under Section 4(1)(a) of Central Excise Act, recourse to Central Excise Valuation Rules read with Section 4(1)(b) of Central Excise Act is required to be made. I am of the opinion that in the present case, the said Valuation Rules should have been applied in determination of the normal price of the disputed goods. The most appropriate rule for application is Rule 6(b)(i), by considering the price of comparable goods produced and cleared by the other manufacturers located in this region. I fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne to extreme fluctuations in prices. It is a volatile product. It is difficult to store. Deterioration is a usual phenomenon. The latent heat in the molasses may cause spontaneous combustion. The pollution it causes by leaching is also a constant headache for the producing factory. Apart from, its use as an addition to cattlefeed, it has no other use. Its only industrial use is for alcohol. The capacity of the alcohol manufacturers is limited. In years of record production a factory may be willing to give away the molasses free, but still may not find any buyers. In lean seasons the same molasses may fetch a price of Rs. 2500/- PMT. In questioning the veracity of its prices, these background factors need to be taken into account. 6. Even ..... X X X X Extracts X X X X X X X X Extracts X X X X
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