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TMI Blog2017 (12) TMI 1077X X X X Extracts X X X X X X X X Extracts X X X X ..... eld that: - Pre-condition in said Rule 8 is that it is applicable when the goods are not sold but consumed captively - SCN dated 30.11.2005 nowhere established that the goods were not sold but they were cleared on stock transfer basis without involvement of sale. There was no case of invocation of Rule 8 of Central Excise Valuation Rules, 2000 - penalties also not warranted - appeal allowed. - APPEAL Nos. E/1954 to 1958/2007-EX[DB] - Final Order Nos. 71910-71914/2017 - Dated:- 5-9-2017 - Mr. Anil Choudhary, Member ( Judicial ) And Mr. Anil G. Shakkarwar, Member ( Technical ) Shri B.L. Narasimhan for Appellant Shri Rajeev Ranjan ( Joint Commr. ) AR for Respondent ORDER Per: Anil G. Shakkarwar Above stated appeals are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... related to supply agreement dated 20.08.1998 between M/s MAL and appellant. It was agreed through the said agreement dated 20.08.1998 that the prices of products other than 2 stroke and four stroke OHC products shall be set by negotiation between the parties, except that prices for service part sold to buyer for the 2 stroke products during the first two years after the joint venture agreement is executed shall be equal to the sellers cost + 40% of amount by which buyers selling prices for the parts exceeds sellers cost. It was contended by Revenue in the said show cause notice that the parts which were sold by the appellant to M/s MAL were sold by M/s MAL to their buyers and 40% of such difference in sales price and purchase price by M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... included the expenditure incurred in the realisation of proceeds on clearance of the goods and, therefore, the demand itself is not sustainable in so far as it relates to demand of ₹ 3,82,08,262/- Further in respect of allegations of profit sharing the Learned Counsel has submitted that the Clauses in the agreement dated 20.08.1998 was not related to goods manufactured by the appellant but the agreement was related to the goods agreed to be traded by the appellant and they have no connection with the goods manufactured and cleared by the appellant, therefore, the sharing of profit under traded goods cannot be added to the assessable value for demand of Central Excise duty. He has also submitted that the show cause notice is time barr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Excise duty is charged on the basis of cost of manufacture under Rule 8 of Central Excise Valuation Rule, 2000. Pre-condition in said Rule 8 is that it is applicable when the goods are not sold but consumed captively. We find that said show cause notice dated 30.11.2005 nowhere established that the goods were not sold but they were cleared on stock transfer basis without involvement of sale. Therefore, we do not find that there was any case of invocation of Rule 8 of Central Excise Valuation Rules, 2000. In view of our such finding we hold that show cause notice is totally misconceived in so far as the demand of ₹ 3,82,08,262/- is concerned. In so far as demand of profit sharing is concerned the said show cause notice nowhere es ..... X X X X Extracts X X X X X X X X Extracts X X X X
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