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TMI Blog2007 (2) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... The issue referred to the Larger Bench is whether the assessable value in respect of goods which are transferred to another plant of the same assessee is required to be determined as per Rule 4 of the Central Excise Valuation Rules, 2000 (as claimed by the appellant) or as per Rule 8 of the said rules (as claimed by the Revenue), in a case where the same goods are also sold to independent buyers? 2.We have heard both sides. It is an undisputed position that the assessees were transferring a part of its production (about 20%) of HR coils to its units at Taloja, Kamothe and Kalmeshwar and the balance production was being sold to independent buyers. It is also not disputed that the value on which duty has been discharged by them at the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e following contentions : (a) There is no conflict between the decisions of the Tribunal in the case of Avon Tubes Ltd. v. CCE, Ludhiana 2004 (117) ECR 616 and BOC India Ltd. v. CCE, 2004 (168) E.L.T. 478. Both the decisions are unanimous in their view that if all the clearances are for captive consumption and there are no clearances to independent buyers, then the provisions of Rule 8 will apply. (b) The decision of Tribunal in BOC's case has no application to the assessee's case, as unlike in BOC's case, where the entire production was captively consumed, bulk of assessee's clearances are made to independent buyers. In BOC's case, the entire production was cleared for captive use and there was no instance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elivered at the time and place of removal, valuation is to be made by taking the value of such goods sold and delivered at the time nearest to the time and place of removal in question. (e) That the Tribunal has in the case of Hindustan Copper Limited v. CCE 2005 TIOL 751 and 2006 TIOL 901, held that even in cases where goods are captively consumed assessable value has to be based on price at which goods are sold to such independent buyers. (f) The Tribunal in the case of Steel Complex Ltd. v. CCE 2004 (171) E.L.T. 255 has held that the assessable value determined by applying Valuation Rules cannot be unreasonable and inconsistent with the provisions of Section 4(1) of the Act. Therefore Rule 4 should to be applied, as it pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rers Association is not applicable as the dispute therein was relating to the applicability or otherwise of Rule 4; assessee's contention that Rule 8 applies only in cases where the goods are not sold but are entirely captively consumed, is incorrect; the Board in its circular dated 1-7-2002 had clarified that in a case where goods are transferred to a sister unit or another unit of same company, the assessable value would have to be determined in terms of proviso to Rule 9, which in turn refers to Rule 8; assessee's contention that Rule 8 will not apply as the goods where not consumed by the assessee himself or on his behalf in the manufacture of other articles was also incorrect as transfer to one's own unit/sister unit tantam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere the goods are consumed by him in the same factory (captive consumption) or (b) where such goods are transferred to another factory for consumption in the manufacture of other articles on behalf of the assessee. In this case, it is not the case of the revenue that the goods were transferred to other units for manufacture of other articles on behalf of the assessee/appellant, i.e. the Dolvi Unit. We agree with the assessee's contention that the expression 'assessee', wherever it appears in the Central Excise Rules, applies to a particular factory, which is why different units belonging to one company are separately registered and separately assessed to duty. Since the assessee in the present case is the Dolvi plant and it is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Valuation Rules. 8.The conclusion that we are drawing in the present case would lead to determination of a value which, in our view, will not only be reasonable but also consistent with the provisions of Section 4 of the Central Excise Act. We would, at this stage, draw support from the judgment of the Supreme Court in the assessee's own case, as reported in 2006 (202) E.L.T. 561, wherein the Court applied The Gunapradhan Principle in interpreting the Customs Valuation Rules. We have kept in mind the following observations of the Court in coming to our above conclusion : 26.In our opinion if there are two possible interpretations of a rule, one which subserves the object of a provision in the parent statute and the ot ..... X X X X Extracts X X X X X X X X Extracts X X X X
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