AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
1998 (11) TMI 248
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....ed that the appellants cleared more than 90% of the hoses in bare condition on payment of duty on the value of hoses. They received orders from customers, mostly public sector undertakings, for supply of rubber hoses fitted with end fittings/couplings. They used to send hoses to the job workers who attached the end fittings to the bare hoses and sent them back to the appellants. They paid duty only on the value of bare hoses. They used to prepare two invoices - one for the bare hose and the other for coupling or fittings. A show cause notice dated 25-8-1992 was issued to them for demanding differential duty amounting to Rs. 12,04,581.32 for the period from 29-5-1987 to 21-5-1992 in respect of hoses fitted with couplings/end fittings/flanges....
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....e value of the hoses. He relied upon the following decisions. (i)  Metal Box of India Ltd. v. CCE - 1983 (13) E.L.T. 956 (Tribunal) (ii)  The Appeal against the above decision filed by the Revenue was dismissed by the Supreme Court as reported in 1990 (45) E.L.T. A33 (iii) Extrusion Process Pvt. Ltd. v. U.O.I. - 1987 (31) E.L.T. 866 (Bom.) (iv) Col Tubes Pvt. Ltd. v. CCE - 1994 (72) E.L.T. 342 (Tribunal) (v)  The Appeal against Col Tube decision filed by the Revenue has been dismissed by the Supreme Court as reported in 1997 (90) E.L.T. A63. 2.3. He also relied upon the following decisions in support of his contention that if bought out items are optional, their cost cannot be included in the assessable v....
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....entral Excise Tariff Act covers "tubes, pipes and hoses of vulcanised rubber, other than hard rubber with or without their fittings", the Revenue cannot contend that the attachment of fittings to the hoses would amount to manufacture. Reliance was placed on the decision in the case of Prabhat Sound Studio v. Additional Collector - 1996 (88) E.L.T. 635 in which the Apex Court rejected the argument that since the tariff item covered both recorded as well as unrecorded tapes, the process of recording on the tapes would constitute manufacture. In any case even if the process of attaching the end fittings to the bare hose amounts to manufacture resulting in the emerging of `composite hoses', such composite hoses had emerged at the job workers pr....
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....ubes Ltd. v. CCE - 1996 (82) E.L.T. 399 in which it was held that for the purpose of value for assessment, expenses incurred on account of several factors contributing to the enrichment of the value of the goods and its marketability have to be considered. That a particular process is not one amounting to manufacture will not be relevant when what is sought to be done is to determine the value of the goods for assessment. The Tribunal held that the cost of galvanising is one of the components which is related to the value of galvanised product and this has to be taken into account in its valuation for the purpose of excise duty. On the contention regarding demand being time barred, the ld. DR mentioned that the appellants had not mentioned ....
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....the hoses fitted with end fittings/couplings/flanges. The ld. Advocate also submitted a statement which show the percentage of hoses removed with fittings during the period from 1987-88 to 1988-89; such percentage varies from 0.83% in 1992-93 to 10.49% in 1989-90. This clearly goes to show that the fittings of couplings/end fittings etc. to the hoses was optional and as per the requirement of the Customers. The Revenue has not controverted also this submission of the appellants. The Appellants have also contended that the couplings, etc. were not fitted by them in their factory premises but in the premises of the job worker. This is apparent from the statements of Shri K.J. Josline and Shri V.M. Shrotri, both working with the appellants. Sh....