Excise valuation of inputs cleared as such: settled precedent and circular made the demand unsustainable.

Clearance of inputs as such was examined under the excise valuation and Cenvat credit rules, with the applicable valuation base disputed as 115% of purchase value or landed cost. Earlier Tribunal decisions and a Board circular were treated as settling the issue, and the demand was found inconsistent with that settled position. The order also notes that the lower authority failed to follow binding judicial discipline despite the relevant precedent and circular. The demand was therefore held not sustainable and the appeal was allowed in favour of the appellant.

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Issues: Whether duty, on clearance of inputs as such, was payable on 115% of the purchase value or landed cost under the applicable excise valuation and Cenvat credit rules.

Analysis: The liability on clearance of inputs as such was treated as a settled question by earlier Tribunal decisions and was further clarified by the Board circular. The impugned demand was therefore inconsistent with the existing settled position governing valuation and credit reversal. The order also records that the lower authority ignored binding judicial discipline despite the availability of the relevant precedent and circular.

Conclusion: The demand was not sustainable and the appeal was allowed in favour of the appellant.

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