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TMI Blog2015 (10) TMI 848X X X X Extracts X X X X X X X X Extracts X X X X ..... Adv., ORDER Per: R. Periasami The present Revenue appeal is against the OIA dated 6.8.2003, passed by the Commissioner (Appeals) and this Tribunal in final order No. 1666/ 2009 dated 10.11.2009 dismissed the revenue appeal. Consequent to the Hon ble High Court of Madras Order dated 12.03.2015 in CMA No. 1633/2010, filed by the Revenue, the appeal is taken up for denovo consideration, wherein the Tribunals final order was set aside accordingly. As the Honble High Court of Madras discussed the history of the case from SCN to final stage, it is appropriate we reproduce the same as under:- This Civil Miscellaneous Appeal filed under Section 35G of the Central Excise Act, 1944 challenging the order dated 10-11-2009 made in Final Order No. 1666 of 2009 on the file of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), South Zonal Bench, Chennai was admitted by this Court on the following substantial questions of law : 1. In the facts and circumstances of the case, whether the 2nd respondent can accept the incorrect statement given by the ld. Counsel 2. Why the value as per Rule 6 of the Central Excise Valuation (Determination of Price of Excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re and supply of goods, appears to have a direct influence on the contracted price entered into between M/s. SDL and their customers. In view of the above facts, it appears that the prices adopted for the purpose of levy of excise duty by SDL are not the sole consideration and hence the base price cannot be determined under Section 4(1)(a) of Central Excise Act, 1944. Thus the price of excisable goods for the purpose of levy of excise has to be ascertained under Section 4(l)(b) read with Rule 5 of Central Excise (Valuation) Rules, 1975. Therefore, an amount of ₹ 63,77,776/- realised towards design, drawing and development charges are required to be included in the price of the goods for the purpose of determining assessable value. The goods under reference falling under various chapters during the relevant period are liable to duty at the rate of 15% adv. Hence the differential duty payable on the additional amount realised by M/s. SDL works to be BED ₹ 9,56,666.40. Consequently, the show cause notice proposed to demand duty as follows : Now. therefore, M/s. SDL are hereby called upon to show cause to the Additional Commissioner of Central Excise (P V), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , when the issue is regarding amortization of cost of moulds and inclusion of such amortization cost on the value of components. When the proceedings is for demanding duty on components, the order demands duty on the value of moulds. This totally unacceptable. Therefore, the impugned order is set aside. However, the department may again proceed against the appellant, if it is found that they have not correctly amortized the value of moulds and included such amortized cost on the components cleared during the disputed period. 6. Not satisfied with the order of the Commissioner (Appeals), the Department went on appeal before the Tribunal. The Tribunal, took note of the submission of the learned counsel appeared for the assessee held as follows : 3. Shri M. Kannan, ld. Counsel appearing for the respondents states that the respondents are not challenging the inclusion of amortised cost of mould in the value of the components and further states that the actual amortised cost has been so included for the relevant period. 4. In view of the fact that amortized cost of the mould has been included in the value of the components for the relevant period as stated by the ld. Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble goods. Whereas the Commissioner (Appeals) has set aside the order on the ground that the appellants were already amortized the value of moulds and included such amortized cost on the components cleared during the disputed period. 3. On the other hand, the Ld. Advocate submits that as per the Annexure A to the SCN, an amount of ₹ 63,77,776/- received from various customers for the period 1995-98 relates to design, drawing and development charges for dies and tools. He further submits that before issue of SCN they have paid the differential duty on the amortized value. He submits that a sum of ₹ 1,24,509/- was paid for the period April, 1995 to June, 1998 vide TR-6 challan dated 21.06.1998. He further submits a copy of the affidavit of Shri K. Seethapathy, Chartered Engineer, enclosing the certificate of value of captive consumption of moulds and dies used in the manufacture of final products. He further submits that they have also paid differential duty for the subsequent period July, 1998 to March,2001 and 2001-02. Duty has been demanded for the total components manufactured during the period 1995-2002, which is supported by the Chartered Engineers certificate. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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