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TMI Blog2007 (8) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... avi Shankar and K.S. Naveen Kumar, the learned Advocates, appeared for the appellant and Shri Anil Kumar, the learned JDR, for the Revenue. 3. We heard both the parties. 4. The issue involved in both these appeals is one and the same. Hence, we are passing a common order. As the issue lies within a narrow campus, we take up both the stay petition and the appeals together for a decision. 5. The appellants manufacture Cars. Normally, they are cleared on the basis of the Transaction Value. In certain instances, the appellants clear the vehicles before launching a new model to the show room. In these cases, there is actually no Transaction Value. However, the appellants clear these goods on payment of duty on the basis of the value prevailin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, which is less than the original duty paid by them at the time of removal of the vehicles to the show room. The learned Advocate forcefully argues that whenever there is a removal, it is the Transaction Value, which is the basis for payment of duty, and the provisions of the Rule cannot override the Section. We find that the lower authorities have not accepted the contention of the appellants. They have interpreted Rule 16(1) and 16(2) as they are. We have to examine these Rules and give a finding whether Rule 16 is against the provisions of Section 4. "RULE 16. Credit of duty on goods brought to the factory. — (1) Where any goods on which duty had been paid at the time of removal thereof are brought to any factory for being re-made, ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory and on which the duty has been paid. At this time, we have to pause and assure ourselves that when any item is removed from a factory, duty has to be paid even in the absence of sale and how to pay the duty? Payment of duty is based normally on Section 4(1)(b) read with Central Excise Valuation Rules. That means, even at the time of removal of the goods, on payment of duty, Section 4 has been invoked in spite of the fact that there was no sale for the reason that when the goods are removed, in terms of the Central Excise Valuation Rules, the duty has to be paid. In the present case, we need not go into which Rule had been applied. So long as the goods have been removed from the factory on payment of duty, Section 4 has already been invo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule, whatever Cenvat credit has been taken on the returned goods, the same has to be paid at the time of removal of these goods. Now, we have to question whether this particular provision is against Section 4. We have already made it clear that Section 4 has already come into play at the time of original removal and only in special circumstances, where the goods are received back into the factory for various purposes, there is a provision for taking the credit and again paying back the amount equal to the credit at the time of removal of these goods. 5.4 The sub-rule (2) of Section 16 speaks of the cases, where these goods are subjected to process of manufacture Only in such cases, since the identity of the goods changes, there is a fresh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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