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TMI Blog2017 (4) TMI 383X X X X Extracts X X X X X X X X Extracts X X X X ..... en sustained. The Order-in-Original dated 25.05.2007 confirms the demand of duty of Rs. 30,43,631/- along with interest and imposes equivalent penalty against the assessee appellant. 2. The brief facts are that: (i) The Appellant is engaged in the manufacture of pesticides and insecticides falling under Chapter 38 of the Central Excise Tariff Act, 1985. They were clearing their products to their depots situated at various parts of the country on stock transfer basis. (ii) Show Cause Notice No.33/2005 dated 15.02.2005 was issued to the appellant alleging undervaluation of the products thereby evading Central Excise duty. It was mentioned that as per Rule 7 of Central Excise Valuation Rules, 2000 read with Section 4 of the Central Excise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ariff heading 3808.10, were notified for assessment under Section 4A of the Excise Act vide Notification No.10/2003-CE(NT) dated 01.03.2003. (iii) Prior to that, the goods were assessed under Section 4 of the Excise Act, though appellant was voluntarily affixing MRP on the goods. (iv) In view of the introduction of the MRP based assessment for the product, appellant revised the MRP, which was comparatively lower than the MRP printed on the packing materials lying in their stock as on 01.03.2003. The declared revised MRP in respect of the finished goods was intimated to the Superintendent vide letter dated 05.03.2003. (v) The Order-in-Appeal confirms the demand on the following grounds: (a) Rs. 13,20,636/- : Depot prices are higher t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fference is only on account of post-removal expenses. (e) The Hon'ble Supreme Court in the case of CC & CE, Nagpur vs Ispat Industries Ltd., 2015 (324) ELT 670 (S.C.) has held that during period 01.07.2000 to 31.03.2003, depot, premises of a consignment agent or any other place from where excisable goods are to be sold after their clearance from the factory was no longer place of removal. Therefore, freight or transportation expenses are not includible in the assessable value. (viii) Regarding alleged incorrect MRP assessment -- goods cleared on invoiced price which is less than the MRP prevailed till then (duty demand of Rs. 2,12,180/-), the appellant submits as under: (a) Valuation had been done on correct MRP, which was also reflec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his regard, the assessee has given copies of some sale invoices as a proof that they sold the goods to independent buyers also. CESTAT in its decision in the case of ISPAT Industries Ltd (supra) has held that Rule 8 of Valuation Rules is applied only if entire production is for captively consumed. Therefore, the duty demand of Rs. 15,10,815.00 along with interest and equivalent penalty is not sustainable and the same is hereby dropped. 6.2 Second part of the demand comprises of Rs. 2,12,180/-, where department says that assessee paid the duty on invoice price which was less than the revised MRP. On the other hand, the assessee appellant argues that valuation was based on correct MRP and the same was reflected correctly in the invoices. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on value at the time of sale from the depot is to be taken as assessable value for charging the duty of Central Excise. The facts in the case of CC & CE, Nagpur Vs Ispat Industries Ltd (supra) are different and, therefore, the ratio laid-down there is not applicable to the present facts. 6.4 For the present facts where goods have directly been stock transferred (without their sale) to the assessee's depot and when the goods are sold from the depot, Rule 7 of Central Excise Valuation Rules, 2000 is applicable. There is no instance that such goods were sold any time at the factory gate of the appellant. When sales have taken place only from the assessee's depots located at various parts of the country, 'transaction value' as per section 4 of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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