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TMI Blog2011 (2) TMI 1008X X X X Extracts X X X X X X X X Extracts X X X X ..... was known prior to sale of goods and Appellant should not have resorted to Rule 8 of the Valuation Rules. Price was also known when a contract for setting up of a switchyard project of Rs.53 million was made on 19.07.06 by M/s. Crompton Greaves Ltd. Engg. Project Division and accordingly, cost was distributed on all the equipments used in the said switchyard project as is evident from the said contract. The impugned order discloses that while the adjudicating authority had accepted the contentions sought to be raised on behalf of the assessee in relation to the first charge against the assessee, and there was a clear finding that the prices of different transformers were not comparable for various reasons recorded in the impugned order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the manufacture of transformers and parts thereof classifiable under Chapter Heading No.8504 of the Schedule to the Central Excise Tariff Act, 1985. The appellants are also availing Cenvat credit on the inputs, capital goods and service tax in accordance with the provisions of the law applicable thereto. 5. A show cause notice dated 5.3.2008 came to be issued to the appellants on two grounds one that the appellants had sold transformers to their sister division at the cost of production + 10% as prescribed under Rule 8 of the Valuation Rules in spite of the fact that the provisions of law applicable to the case of the appellants are comprised under Rule 11. Secondly, that the appellants had failed to inform the department about the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material contents and usage, thus giving rise to pricing of transformer differently though of same rating. Hence each transformer shall have different price and comparable price formula is totally wrong and cannot be adopted. Even Rule 11 of valuation rules only says that if price cannot be determined by any method of rule 4 to 10, the value can be determined using reasonable means consistent with provisions of Rule 4(1) of the Act. The Tribunal in case of Reliance Industries Ltd. Vs. CCE [2006 (201) ELT 622] has also held that valuation under rule 11 read with rule 8 is the best judgement assessment. Tribunal even in case of CCE Vs. VPC Poles Factory [2006 (199) ELT 865] has held that when no rule is applicable, adopting principle of rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atings, are not comparable. 8. After recording the above findings in relation to the first charge, the adjudicating authority proceeded to deal with the second charge, which related to the issue of CAS-4 as under:- The allegation in para 3(iv) of the show cause notice, is that the certificate of cost issued by the chartered accountant and relied upon for valuation by the notice is not in accordance with the Cost Accounting Standard on cost of production for captive consumption, as prescribed on CAS-4. And it is also alleged that the cost of direct wages and salaries, direct expenses, work overheads, R D and Quality Control etc. have not been considered while arriving at valuation of goods cleared by related person at the site of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... early disclosed that the appellants had clearly contested the contention in that regard sought to be raised by the department. Being aggrieved by the order of the adjudicating authority, the assessee preferred appeal before the Commissioner (Appeals), which came to be disposed of by the impugned order. 10. The Commissioner (Appeals) after recording the rival contentions sought to be canvassed before him and taking note of the statutory provisions including the provisions of Rule 8 of the Valuation Rules, and Section 4 of the Act proceeded to decide thus:- In the instant case price of the comparable goods to independent buyer was available with the Appellant as is evident from the sale of 7500KVA Copper bound transformer made to M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In those circumstances, it was not open to the Commissioner (Appeals) to arrive at any finding contrary to the said finding. However, plain reading of the impugned order discloses that the Commissioner (Appeals) proceeded to decide the issue in relation to the first charge as if the Commissioner was dealing with an appeal at the instance of the department against the said finding. This clearly amounted to exceed the limits of appellate jurisdiction of the Commissioner (Appeals) while dealing with the appeal filed by the assessee. In the absence of any challenge to the said findings, it was not open to the Commissioner (Appeals) to re-open the said issue. 12. As regards the second issue is concerned, we find no discussion at all in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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