2008 (12) TMI 556

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... in the manufacture of motor vehicles and parts thereof. During the relevant period, they were clearing parts of tractors to their sister units. Duty was paid on the goods cleared to their sister units for further use in the manufacture of tractors. Duty was paid on these parts on the basis of value determined under Rule 8 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000. The value was so determined as 110% of the cost of production of the goods. However, the appellants were not possessed of the correct cost of production at the time of clearance. Their practice was to adopt the cost of production obtaining prior to 1st of April of the financial year during which the goods were cleared, and then estima....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e assessee's unit and verified the costing data submitted by them for the year 2006-07 for clearance of the subject goods for captive consumption. The verification report was submitted to the Dy. Commissioner of Central Excise having jurisdiction over the factory. This report stated thus : "In this regard, the cost of production of various products of Tractor Division was verified from the SAP accounts as per CAS-4 Guidelines and the CAS-4 statements for the year 2006-2007 duly certified by M/s. Y.R. Doshi and Co., Cost Accountants, were also reviewed and based on the clarifications and explanations furnished by the assessee on certain variation in cost of production between the value of clearance and cost as per CAS-4 statements in resp....