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of <h1>Tribunal sets aside duty assessment based on non-applicability of Valuation Rule 9</h1> <h3>TECHNOWELD ALLOYS (P) LTD. Versus COMMISSIONER OF C. EX., CHENNAI</h3> TECHNOWELD ALLOYS (P) LTD. Versus COMMISSIONER OF C. EX., CHENNAI - 2008 (224) E.L.T. 83 (Tri. - Chennai) Issues:1. Assessment of differential duty and penalty on the appellant for sales to a related buyer.2. Applicability of Rule 9 of the Central Excise (Valuation) Rules in determining assessable value.Analysis:Issue 1: Assessment of differential duty and penaltyThe case involved the appellant selling Wear Resistant Plates (WRP) to a buyer, M/s. Sudarshan Trade Syndicate (STS), owned by a director of the appellant-company. The department sought to assess the goods cleared to STS at a higher price charged by STS to a Thermal Power Station, Tuticorin. This assessment led to a demand for differential duty and penalties on the appellant. The original authority upheld this decision, resulting in the appellant challenging the assessment through the present appeal.Issue 2: Applicability of Rule 9 of the Valuation RulesThe lower authorities invoked Rule 9 of the Central Excise (Valuation) Rules to demand differential duty, considering STS related to the appellant under Section 4(3)(b) of the Central Excise Act. The appellant argued against the applicability of Rule 9, citing various precedents, including the case of Aquamall Water Solutions Ltd. v. Commissioner and C.C.E v. Arofine Polymers Ltd. These cases established that Rule 9 was not applicable when sales were made to both related and unrelated buyers. The appellant contended that since the majority of clearances were to unrelated buyers, Rule 9 should not be applied. The Tribunal, in agreement with the appellant's arguments and supported by legal precedents, set aside the impugned order and allowed the appeal with consequential reliefs.In conclusion, the Tribunal found in favor of the appellant, setting aside the assessment of differential duty and penalties. The decision was based on the non-applicability of Rule 9 in the given circumstances, where the majority of clearances were made to unrelated buyers, aligning with established legal precedents.
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