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TMI Blog2019 (2) TMI 754X X X X Extracts X X X X X X X X Extracts X X X X ..... f the adjudicating authority are unsustainable on the face of it. If the revenue authorities are not finding fault with the assessable value on which Central Excise duty is paid, when cleared to independent buyers, the said value needs to be considered as a correct assessable value. In the case in hand, there being no dispute of the assessable value cleared to independent buyers, the same value having been considered by the appellant for the clearances made to the sister concern is correct and cannot be called out for revaluating the clearances made to sister unit. Revenue neutrality - Held that:- The clearances which were made by the appellants to the sister unit on payment of duty and sister concern is availing the CENVAT credit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Valuation Rules, 2000 by arriving at cost construction basis and add to that profit margin. The said show cause notice alleges that the value of goods cleared to rerolling division was undervalued inasmuch as that the cost construction of the goods cleared based on balance sheet figures is very high. Show cause notice was issued for the demand for the differential duty along with interest and also for imposition of equivalent amount of penalty under Sec.11AC of the Central Excise Act, 1944. Appellant contested the show cause notice on merits as well as on limitation. The adjudicating authority, after following due process of law, confirmed the demands so raised along with interest and also imposed equivalent amount of penalty. 3. Learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n is worked out by the revenue from the balance sheet. It is his further submission that the valuation rules are very clear inasmuch the value of goods which are consumed captively should be based on cost construction method only. It is his submission that the larger bench decision may not apply in the case in hand as in this case appellant has cleared 92% of the goods manufactured by them to their sister concern and only 8% is sold to independent buyers. He relies upon the decision of the Tribunal in the case of Jindal Stainless Ltd [2009 (246) ELT 597], Sicgil Industrial Gases Ltd [2009 (245) ELT 693] and Sundaram Fasteners Ltd [2009 (237) ELT 55] to submit that the valuation of goods cleared to sister unit is to be done under Rule 8 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essable value. This is the law which has been decided by the larger bench in the case of Ispat Industries Ltd (supra) wherein in Para 5 and 6 the larger bench held as under: 5. We have considered the rival submissions and are of the view that the assessee is correct in contending that provisions of Rule 8 would apply only in a case where its entire production of a particular commodity is captively consumed. This is evident on a plain reading of Rule 8 of the valuation rules, which reads as under Where the excisable goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value shall be one hundred and ten per cent of the cost of production or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d separately assessed to duty. Since the assessee in the present case is the Dolvi plant and it is not the revenue s case that the other three units of the company to whom HR coils were transferred were undertaking further manufacturing operations on behalf of the Dolvi Unit, the provisions of Rule 8 will not apply. We, therefore, hold that Rule 8 is inapplicable in the instant case. 6. We also note that in the present case the application of Rule 4 is being disputed by the Revenue not on the ground that the said rule is inapplicable to the present case but on the ground that a more specific provision in Rule 8 is available to enable determination of the assessable value. As discussed above, the provisions of Rule 8, in our view, are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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