TaxTMI 
TaxTMI 
TaxTMI 
2013 (12) TMI 451
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.... is loaded to beam warpers and warps are prepared, 3. Pirn winding - winding of twisted yarn on wooden pirns, 4. Weaving of twisted yarn into fabrics (gray stage) 5. Dipping - the grey fabrics are dipped in resorcinol formaldehyde latex solutions and 6. Drying. The names of five such parties who got job-work done are mentioned in the SCNs. The appellants were also manufacturing such fabrics on their own account out of raw materials imported by them and clearing such manufactured goods on payment of duty based on sale price of the goods. The assessable value at which duty was discharged for job-work goods were lower than the assessable value of goods which were manufactured by appellants on their own account and sold to customers. 3. The appellant had worked out the assessable value of the fabrics manufactured on job-wok basis based on cost construction certified by a chartered accountant and paid duty on such assessable value. The dispute involved in the present appeal is that the appellant did not include bank charges for opening of letter of credit, to-bond and de-bond charges and C&F charges incurred by their customers while importing yarn and process loss of yarn for arriving ....
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....ibunal the matter was challenged mainly on the issue whether the extended period of 5 years period could be invoked in this case alleging suppression of facts on the part of the appellants. The Tribunal vide Final Order No.537 & 538/98 dt. 24.2.98 ordered as under: "8. In order to give a finding in this aspect, the, annexures are necessary, which are not with the appellants. The annexures will be only in the original file. In order to invoke longer period of limitation, it is necessary for the department to specifically show as to which of the various commissions or omissions stated in the Proviso to Section 11A of the Central Excises and Salt Act had been committed by the appellant. This can be done with reference to the annexures to the show cause notice and such a conscious finding is not coming out in the impugned order. These are principles laid down by the Supreme Court in the decision reported in 1995 (76) ELT 497. In the decision, their lordships held that show cause notice must contain an averment to the effect pointing out specifically as to which of the commissions or omissions stated in Proviso to Section 11A of the Central Excises and Salt Act had been co....
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....he order does not examine the issue with reference to each job-work done by the appellant. It is pointed out that the original authority or the first appellate authority did not look into each job-work as directed by the Tribunal. 9. The orders of the lower authority do not demonstrate how mis-declaration or suppression has been made in respect of each work order. 10. It is further contended that the Commissioner (Appeal) himself acknowledges the fact that the appellant has no means to know the price of the material supplied by the customers but has to go by the declarations of such parties. Against such a finding the charge that appellant suppressed the landed cost of materials is not sustainable is not sustainable. 11. Further it is argued that during the period prior to 04-11-88 when the Apex Court gave its decision in the case of Ujagar Prints reported at 1988 (38) ELT 535 (SC) there was considerable confusion as to the principles to be followed for arriving at the assessable value of goods manufactured on job-work. Even the decision needed further clarification which was given by the Apex Court only on 27-01-89 as reported at 1989 (39) ELT 493 (SC). The Ld. Advocate submits....
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....not in a position to clearly explain this marginal difference. At any rate such minor variation for one party for one consignment cannot be reason to confirm demand in respect of job-work done for all the five parties for all the job-work orders. 15. Further he argues that the question whether the cost of wasted raw material would form part of cost of final product itself was under dispute. He points the decision of the Tribunal in the case of Mahindra Ugine Steel Co Ltd - 2003 (157) ELT 435 (Tri-Mum) in this regard. (This decision was however subsequently reversed). The argument of the Ld. Advocate is that considering the fact that the legal position and method of working out cost of job-work goods were not quite clear at the relevant time there could be no charge of suppression against the appellant. He points that the method of CAS-4 based costing was prescribed only in Feb 2003 and the impugned clearances were made during the period June 83 to June 88 and the principles now settled cannot be invoked for such past period to allege suppression with intention to evade duty. 16. We have considered submissions on both sides. We have perused the annexures to Show Cause Notice dated....