Tribunal includes amortised cost of moulds in aluminum die-castings value

The Tribunal upheld the inclusion of the amortised cost of moulds and dies in the assessable value of aluminum die-castings. The case was remanded to the Commissioner (Appeals) to assess whether the demand was time-barred.

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Issues Involved:
1. Inclusion of the cost of moulds and dies in the assessable value of aluminum die-castings.
2. Whether the demand is barred by the limitation of time.

Summary:

Issue 1: Inclusion of the Cost of Moulds and Dies
The primary issue was whether the cost of moulds and dies manufactured by the appellant and sold to their customers should be included as an amortised cost when used in the appellant's factory for manufacturing aluminum die-castings for those customers. According to Rule 6 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 (CVR), the value of such goods includes the transaction value and the money value of any additional consideration flowing directly or indirectly from the buyer to the assessee. The Tribunal concluded that the amortised cum-duty cost of the dies/moulds supplied free of cost to the appellant by their buyer-customers should be included in the assessable value of the aluminum die-castings. The Tribunal also referenced the Larger Bench judgment in Mutual Industries Ltd., which held that the additional value of the moulds must be included in assessing the duty payable on the finished product under excise law.

Issue 2: Limitation of Time
The second issue was whether the demand is hit by the limitation of time. The appellant argued that the issue of non-amortization of the mould cost had been raised by CERA in June 2004 and by the internal audit party in September 2006, and both objections were settled. The Tribunal noted that the lower authority had not examined these submissions and that this issue impacts the duty and interest demanded along with the penalty imposed. Therefore, the Tribunal remanded the matter to the Commissioner (Appeals) to examine the issue of limitation/time-bar and pass a reasoned order as per law.

Conclusion:
The impugned order was upheld on merits, confirming that the amortised cost of moulds and dies should be included in the assessable value of aluminum die-castings. However, the matter was remanded to the Commissioner (Appeals) to determine whether the show cause notice was time-barred.

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