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TMI Blog2023 (6) TMI 691X X X X Extracts X X X X X X X X Extracts X X X X ..... -transferred goods under Rule 8 of the Central Excise Valuation Rules by adopting 110% of the cost of production. In determining the value the Appellant adopted CAS-4 method. Later on, the CERA audit took place and value was re - determined and accordingly, the demand was raised. Further, the Revenue referred the matter to Additional Director (Cost), who determined the assessable value for the respective year by adopting CAS-4 method but taking into consideration the cost of various overheads arrived at the value which was higher for the period 2005-06 and 2007-08 as per the value determined by the Appellant. But for the period 2006-07, 2008-09 and 2009-10, the assessable value determined was less the value which they had paid duty. Therefore, it was contended by the Appellant that they have paid excess duty on their clearances on stock-transfer basis to their sister unit. But the Adjudicating authority confirmed the differential demand of duty along with interest and imposed penalty on the Appellants. Against the said order, the Appellants are before us. 3. It is the contention of the Ld.Consultant appearing on behalf of the Appellant that at the time of clearance of goods they h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Ltd. v. Raipur-1 - 2016 (342) E.L.T. 253 (Tri. - Delhi) and Essar Steel India Ltd. v. CCE, Raipur - 2017 (345) E.L.T. 139 reversed the order, holding : "7. We have considered the submissions made by both sides. The goods have been cleared by the appellant to their own sister unit located in tax exempted areas. Consequently, the appellant is require to pay excise duty on goods so cleared. The basis of valuation is also required to be done in terms of Rule 8 of the Central Excise Valuation Rules, 2000 following the Cost Accountant Standards (CAS-4). It is not in dispute that valuation has been done properly as per CAS-4. However, such valuation has been done on the basis of CAS-4 certificate prepared on the basis of annual cost of production. The appellant has paid duty on a month to month basis on the basis of the cost of the goods for the previous month. When the valuation is finalised on an annual basis, there has been short payment of duty in some months as well as excess payment in other months. The appellant has already paid the excess duty wherever the value as per CAS-4 is more than the value adopted for payment of duty, but after adjusting the excess paid duty in other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eraging of cost for a period, considering all the parameters. It is neither the case of the appellant nor there is such an approved standard for arriving at cost of excisable goods for each individual clearance. 7. Now, the question remains when at the time of each clearance of excisable goods for captive consumption the exact transaction value could not be arrived at the relevant time the duty has to be paid on a provisional basis and upon arriving at the costing applying CAS-4 and the assessable value in terms of Rule 8 of Valuation Rules final determination of duty liability has to be made. In the present case, admittedly no provisional assessment was resorted to by the appellant. Hence, the determination of actual cost much later on the clearance resulted in certain adjustments and payments by the appellant. 8. The appellants referred to guidelines issued by the institute of Cost & Works Accountants of India on CAS-4. We have perused the same. Para 8 deals with periodicity of CAS-4 Certificates. The guidelines state that the frequency of revising the certificate of cost of production will depend upon the significance in the changes in the cost due to various factors like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the duty paid in excess in certain months has been availed as credit by sister unit hence, cannot be adjusted towards short payment also not tenable. The demand arose based on annual costing. Such cost price in terms of Rule 8 will apply to all clearances made during the relevant year. Admittedly, duty already discharged has to be considered for arriving at overall short payment. Selectively applying the said cost price only for months when the clearances were below such cost price is not legally sustainable." 10. The appellant has claimed that they have already paid the short-paid duty payable after deducting adjusting the excess. The adjudicating authority is directed to verify the same and recover only the differential, if any, after such adjustment." b. M/s. Finolex Industries Ltd. v. Commissioner of Customs-Pune [EA- 1540/2012 Order No.A/85967/2022-CESTAT MUMBAI] - wherein it has been held as under:- "4.3 Undisputedly Appellants submitted the CAS-4 certificates along with their ER-1 returns. The CAS-4 certificate mentions that valuation was done on the basis of previous year's figures and adjustment on account of inflation was done. They had adopted the above method ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods cleared to sister concern, whatever duty payable available as credit to own unit (sister concern) hence entire exercise revenue neutral - Grievance now that undervaluation not considered by Tribunal - HELD : Grievance acceptable if ultimate exercise benefited Revenue by collection of duty - No such benefit accrues to exchequer - Tribunal chosen not to determine academic issue - No legal infirmity in impugned order of Tribunal - Sections 4 and 11A of Central Excise Act, 1944. - If the Tribunal has chosen not to determine an academic issue, it is not possible to state that any legal infirmity exists in the impugned order of the Tribunal. [para 4] 16. We find the above decisions are squarely applicable to the Appellant. As the entire exercise would be revenue neutral, there is no loss of revenue to the exchequer. 17. In view of the above discussion, we hold that the demand confirmed in the impugned order is not sustainable. Since the demand itself is not sustainable, the interest demanded and the penalty imposed against the Appellant in the impugned order is also not sustainable. In view of the above, we set aside the Impugned Order and allow the Appeal filed by the Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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