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TMI Blog2000 (9) TMI 853X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise Rules, 1944]. The said rule provides, inter alia, for movement of inputs as such or after the inputs have been partially produced for further processing and/or for manufacture of the intermediate products. The partially processed inputs or intermediate products are to be returned to the original manufacturer for further use in the manufacture of final products. But, instead of returning the component so received/obtained from M/s. TELCO under the aforesaid rule, the appellants used it as component in the manufacture of Brakes and cleared the same to M/s. TELCO on payment of duty under challan-cum-invoices accompanied by Gate passes. While determining the assessable value of the Brakes for payment of Central Excise duty, the value of cylinder, which was received under Rule 57F(2), was not included. During the material period, the appellants were given exemption under Rule 173C(ii) ibid from filing price list subject to the condition that the price declared in the invoice should represent the value in terms of Section 4 of the C.E.A., 1944 which inter alia includes value of inputs, component and parts used in the manufacture of the finished excisable goods. As the appellants fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CO and as such the value of the cylinder taken as Rs. 242/- per piece for the said purpose was wrong. If the value is computed as per the challans of M/s TELCO, the total value would come to either Rs. 38,98,573.87 or Rs. 45,54,495.82. They submitted that the cost of transportation to the extent of Rs. 1,44,000/- was not to be included in the duty demand. They have also advanced the plea of limitation on the ground that nothing was withheld from the Department and in fact everything was within the knowledge of the Department. 2.2. The contentions of the appellant did not find favour with the Commissioner. He was of the view that in the case where the job worker opts to pay duty on the dutiable intermediate products, in the instant case - Brake, the assessable value of the same shall be determined in accordance with the provisions of Section 4 of the C.E.A., 1944. The appellants' contention that the value of the cylinder is not addable to the assessable value of the Brake was rejected by the Commissioner on the following ground that an independent marketable excisable product has emerged at the job worker's premises and when such a product is cleared the provisions of Rule 9(1) ib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dited in the account of M/s. TELCO under the Modvat Scheme to avoid cascading effect. He points out that the jurisdictional Central Excise authorities of M/s. TELCO had been auditing and verifying the transaction between M/s. TELCO and the appellant under the said rule as evident from the appellant s letter dated 28-5-1993. Arguing on limitation, the learned Senior Advocate invites attention to the fact that the appellant in his letter dated 21-11-1989 categorically informed the Department that he was paying duty on the value excluding the cost of cylinder. The appellant had opted for invoice price and RT-12 returns were duly assessed on the basis of the price indicated in the purchase order. The Central Excise Audit party examined the records and documents from time to time. These facts, according to the learned Senior Advocate, go to prove that the appellant did not suppress material fact with intent to avoid payment of duty and, therefore, proviso to sub-section (1) of Section 11A ibid cannot be invoked. He pleads that both on merits as well as on limitation, the order impugned is liable to be set aside. Accordingly, he makes a prayer for doing so. 4. Shri R.N. Das, learned Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctory ; (b) for the purpose of manufacture of intermediate products necessary for the manufacture of the final products and return the said intermediate products to his factory for further use in the manufacture of the final products or remove the same without payment of duty under bond for export, provided that the waste, if any, arising in the course of manufacture of such intermediate products is also returned to the said factory. On a careful reading of the said rule and the findings of the Commissioner in the order impugned, we do not find any merit in the arguments of the appellants on the question of valuation of the subject goods at the time of clearance from their factory. We agree with the Commissioner that when the appellants have opted to pay duty, which they were not duty bound to pay in view of the provisions of the said rule, the value of such goods shall be determined in accordance with the provisions of Section 4 ibid and while doing so the ratio of the judgment in Ujjagar Prints shall be applied, which is to the effect that duty is payable on the job charges plus the cost of the material. The ratio of the said judgment, in our view, applies equally to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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