2014 (6) TMI 721

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..... to easily shift the penultimate process of manufacture to a job worker and evade excise duty on the value addition which has significant ramifications. Further, manufacture includes any process incidental or ancillary to the completion of a manufactured product and cutting of paper from reels into sheets is a process incidental or ancillary to the completion of the paper sheet. As per Rule 10A of the Central Excise Valuation Rules, when goods are sent for job-work and the job-worked goods are sold from the job workers premises, duty liability has to be discharged on the sale price of the job-worked goods charged by the principal manufacturer. This change in the valuation Rules came with effect from 1st March 2007. Therefore, the stay o .....

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..... reasons stated as satisfactory, we condone the delay in filing the appeal. 3. The learned Consultant submits that the appellant is a manufacturer of paper and paper boards. The papers are cleared from the factory both in reel form as also in sheet form. In respect of paper for which orders were received for supply in sheet form, the appellant cleared the paper in reel form to the job-workers for cutting of paper reels into paper sheets. They discharged excise duty liability on a lower value applicable to reels. After undertaking the job work, the goods were sold form the job workers' premises to the ultimate buyers at a higher price applicable for the sheets. The department was of the view that the duty liability should have been dis .....

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..... ause the paper was initially cleared to the job-workers for conversion from reels into sheets and thereafter supplied/sold to the buyers, why should the duty liability be discharged on a lower value? If such a view is taken, it will be possible to easily shift the penultimate process of manufacture to a job worker and evade excise duty on the value addition which has significant ramifications. Further, manufacture includes any process incidental or ancillary to the completion of a manufactured product and cutting of paper from reels into sheets is a process incidental or ancillary to the completion of the paper sheet. As per Rule 10A of the Central Excise Valuation Rules, when goods are sent for job-work and the job-worked goods are sold fr .....

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