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TMI Blog2023 (6) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... of M/s. Mira Textiles. The price adopted by the appellant was only the cost of production at their hand as evidenced from the cost sheet prepared. The goods were sold by Mira to other customers. There was a difference in the sale price of the goods adopted by M/s.Mira Textiles when compared with the sale price of the appellant to M/s. Mira Textiles. The department was of the view that amount received by the appellant was only compensation of the expenditure incurred by them and received by them through the sale invoices raised. 3. It appeared to the department that the appellant had simply been acting as a job worker for M/s. Mira Textiles (who is the principal manufacturer) and the value adopted for payment of duty was not the sole consideration for sale as required under Section 4 (1) (a) of Central Excise Act, 1944. Hence the valuation was required to be determined as per Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 under Section 4 (1) (b) of Central Excise Act, 1944. The appellant though was doing job work for Mira for the period May 2008 to September 2009 had failed to disclose these aspects and the correct value of their clearances in thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Textiles and the finished products are also sold to M/s. Mira Textiles, it cannot be considered that the appellant is a job worker to M/s. Mira Textiles. 6. Ld. Counsel adverted to Section 4 (1) (a) of Central Excise Act, 1944 and submitted that the appellant has satisfied all the conditions set out in the above section. The section specifies the following conditions to be satisfied for adopting the transaction value for payment of excise duty : (a) the finished goods must be sold for delivery at the time and place of removal. (b) seller and buyer should not be related and (c) price must be the sole consideration for the sale. In the present case, the department has invoked Rule 10A to determine the assessable value and the liability to pay duty. The said Rule 10A can be invoked only if Section 4 (1) (a) fails. Rule 10A (i) of the Valuation Rules 2000 has no application, since in the instant case, the goods manufactured and sold by the appellants are not on job work basis. The department alleges the appellant to be a job worker without any proper evidence to substantiate the allegation. 7. Ld. Counsel has also argued on the ground of limitation. The period involved is fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra Textiles & Industries (I) Ltd. and M/s. Mohan Breweries under the instructions of M/s. Mira on the basis of transaction value as per Section 4 (1) (a) of Central Excise Act, 1944 is correct or whether Rule 10A of Valuation Rules, 2000 has to be applied. For better appreciation Section 4 (1) (a) and 4 (1) (b) of Central Excise Act, 1944 are reproduced as under : "SECTION 4. Valuation of excisable goods for purposes of charging of duty of excise. - (1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to their value, then, on each removal of the goods, such value shall - (a) in a case where the goods are sold by the assessee, for delivery at the time and place of the removal, the assessee and the buyer of the goods are not related and the price is the sole consideration for the sale, be the transaction value; (b) in any other case, including the case where the goods are not sold, be the value determined in such manner as may be prescribed. Explanation. - For the removal of doubts, it is hereby declared that the price-cum-duty of the excisable goods sold by the assessee shall be the price actually paid to him for the goods sold and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed or manufactured by a job-worker, on behalf of principal manufacturer. In the present case, the department alleges the appellant to be a job worker for the reason that the kraft paper (raw material) is supplied by M/s. Mira Textiles. It has to be noted that there is no free supply of raw materials to the appellant by M/s. Mira Textiles and it is actually purchased by raising invoices and paying the value of the raw material along with duty and applicable Sales Tax / VAT. The ownership of the raw material is therefore transferred from M/s. Mira Textiles to the appellant. Such kraft paper is used for manufacture of carton boxes which are finished product and cleared to M/s. Mira Textiles and M/s. Mohan Breweries under the instructions of M/s. Mira Textiles. The department has relied upon a statement of Shri G. Hari Hara Subramanian, General Manager of appellant-company to allege that appellant is a job worker. The documentary evidence in the nature of invoices for purchase of raw materials, invoices for clearances of finished products indicate that the appellant is an independent manufacturer. Documentary evidence prevails over oral statement which is not put to the test of examina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the activity undertaken by the appellant is controlled by Sigmakalon from the stage of procurement of raw materials; that the equipment I supplied free of charge for the manufacture of the products, the installation of which will be done by Sigmakalon at the appellant's premises while retaining the ownership and also the repair & maintenance for the same will be taken up by Sigmakalon; control over the inventory of inputs and process of manufacture and there is a finding in the impugned order to the extent that the raw material/packing material was to be obtained from the persons identified by Sigmakalon. Further, the whole process as to how the advances were paid and the suppliers of raw material/packing material were appointed by Sigmakalon to circumvent the actual transaction of supply of raw material; as to how the price shown in the invoices is not the sole consideration and there are various other considerations as per the terms of the agreement was explained in the impugned order. I do not find any infirmity in the impugned order to cause any disturbance of the decision." 10. We find that the entire thrust of the findings of ld. Commissioner (Appeals) is the definiti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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