9911796707
TMI Blog2007 (6) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... her two appeals are listed for hearing today. As the issue involved is the same, all the appeals shall remain disposed of under this common order. 2. The appellant is a manufacturer of tyres, more specifically, tyres for earthmovers and other industrial equipments, for exports. While it manufactures the tyres in its factory, the inner tubes and flaps for the tyres are procured from outside. Tyres are cleared from the factory after fixing the inner tubes and flaps into/on to the tyres. 3. Bulk of the produce of the appellant is exported and the appellant is entitled to rebate of excise duty paid on the tyres. The appellant is also availing of credit of duty on the inputs going into the manufacture of the tyres including on the inner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment. 7. The ld. SDR would reiterate the findings in the impugned order that tyres and tubes are entirely different products and, therefore, one cannot be treated as input in the manufacture of the other. He would also point out that, from the record, it is not clear, as to whether the value of tubes and flaps were forming part of the assessable value of the tyre/'set pack' at the time of their clearance from the factory. 8. We agree with the assessee. The tyres in question are not tubeless tyres. They required inner tubes as an essential item for functioning. The flaps are also useful and make the functioning of the tyres more convenient and trouble free. Therefore, while tubes can as well find place as part or component of tyre, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l goods" "used... in or in relation to manufacture" "whether directly or indirectly", "whether contained in the final product or not". The very narrow construction placed by the Commissioner shrinks the definition to an extent that it excludes situations specifically covered by the definition. 10. This is also for good reason. Excise is on manufacture and the definition of manufacture includes all processes in connection with the manufacture, including embellishment. And the value of all these processes and the items going into them go into the assessable value of the manufactured product. Thus, it is the product, as it is cleared from the factory, with all improvements, embellishment and accessories that gets assessed. Input credit rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Polymers v. CCE, reported in 1989 (43) E.L.T. 165, this Court has held that under Section 4, the normal price for which the goods were sold at the factory gate shall be taken as the assessable value and if a manufacturer levied a charge for an item (socket in this case), which was instrinsically necessary to place the pipes on the market then the cost of such an item had to be loaded to the normal price of the pipes. Applying the above test to the fact of the present case, we find, as stated above, that the sockets were fitted on the said m.s./g.i. pipes before their clearance. It has been concurrently found by the Commissioner as well as by the Tribunal that the sockets were fitted on the threaded portion of the pipes. It has been foun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partment within eight weeks from the date of receipt of the judgment. In fact, directions to that effect have been given by the Tribunal in the impugned judgment. 12. In the present case, tubes and flaps are in the position of socket. Therefore, their value should go into the valuation of tyres cleared, as the tyres were cleared as 'set packing' i.e. along with the tubes and flaps. Similarly, the appellant will be entitled to take credit of duty paid on tubes and flaps and use that credit for payment of duty. 13. The appeals are ordered in the above terms. 14. Since the ld. SDR has raised a doubt as to whether the value of tubes and flaps were included in the assessable value of 'set packs'/tyres, we leave that factual aspect to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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