Rule for value of Excisable Goods.

[Kunal Pawar]

Sir,

If a manufacturer clearing 95% of his finished goods to the related buyer and remaining 5% to other independent buyers, then under what Rule of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000, the value of the Excisable goods will be determined.

AI Summary

Supreme Court clarifies Rule 9: Interest, depreciation, and profit margin excluded in valuation for related party sales. A manufacturer sells 95% of goods to a related buyer and 5% to independent buyers. The valuation of goods sold to the related buyer is governed by Rule 9 of the Central Excise Valuation Rules, 2000, amended in 2013, requiring valuation based on CAS-4 plus 10% of production cost. Goods sold to independent buyers are valued at transaction value. A Supreme Court ruling clarified that interest, depreciation, and profit margin should not be included in cost calculations. The discussion further explored the implications of related party sales and marketing expenses on valuation.