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TMI Blog2017 (7) TMI 488X X X X Extracts X X X X X X X X Extracts X X X X ..... e incurred for the said intermediate products. If the entire expenditure shown in the Trial Balance is taken for arriving at the overhead rate, then this will definitely reflect the overhead for the manufacture of the final product viz., Tyre in this case and will not represent the overhead rate for the intermediate goods - appeal dismissed - decided against appellant. - E/756/2005 - 41012/2017 - Dated:- 15-6-2017 - Smt. Sulekha Beevi C.S., Member (Judicial) And Shri V. Padmanabhan, Member (Technical) Shri S. Govindarajan, AC (AR) for the appellant Shri Karthik Sundaram, Advocate for the respondent ORDER Per Bench 1.1 The respondents are manufacturers of tyres and tubes and also manufacturing airbags, bladder ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.2003. Aggrieved by this order, the respondents filed appeal before the Commissioner (Appeals) on 08.01.2004. The Commissioner (Appeals) vide order-in-Appeal No. 36/2004 dated 12.2.2004, held that such expenses are not includible in the cost of production. 1.2 In the meanwhile, against the very same order-in-original No. 30/2003 dated 18.11.2003, the department filed appeal before the Commissioner (Appeals), putting forward the following grounds: a) Working sheet submitted by the respondents was attested by an employee and not certified by a Chartered Accountant. b) Board's Circular dated 30.06.2000 clarifies that general cost accounting principles should be followed while determining the cost of commodity. The method adopt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -original No.30/2003 dated 18.11.2003 has merged with the order-in-appeal dated 12.02.2004. He submitted that the original authority has not verified the worksheet submitted by the respondents properly and the overhead rate furnished by the respondents ought not to have been accepted since the method adopted by them is incorrect. 3. We have heard the submissions made by both sides. 4.1 At the outset, we have to say that we are surprised how the Commissioner (Appeals) admitted the appeal filed by the department against the order-in-original dated 18.11.2003. The department has filed the appeal only on 30.11.2004 and that too after the appeal filed by the respondent has been disposed of. We see that even though the Commissioner (Appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trative expense, advertisement expense, interest expense in the cost of production. The Commissioner (Appeals) has also stated that the rate arrived by the department on the basis of Trial Balance of the unit is incorrect, for the reason that what is to be taken into account for finding out the cost of production on the intermediate goods is only the related expenditure incurred for the said intermediate products. If the entire expenditure shown in the Trial Balance is taken for arriving at the overhead rate, then this will definitely reflect the overhead for the manufacture of the final product viz., 'Tyre' in this case and will not represent the overhead rate for the intermediate goods. The Commissioner (Appeals) has thus in our v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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