TaxTMI 
TaxTMI 
2014 (8) TMI 137
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....o registry to list the same in its due course, while take up connected appeals nos.E/11205,11298/2013 filed by department for disposal. 3. For brevity sake, we take the facts from impugned order Nos.4 & 5/COMMR/2013, dt. 15.01.2013. 4. The relevant facts that arise for consideration are during the scrutiny of records of M/s. Reliance Industries Ltd. (hereinafter referred to as 'RIL'), it appeared to the CERA Audit that the appellants were transferring excisable goods to their own manufacturing unit on a value determined based on the factory gate sale of the same product to independent buyers; CERA Audit were of the view that RIL had to discharge duty liability on such transfers to their own units based on the valuation of goods under Rule 8 of the Central Excise Valuation Rules, 2000 read with Board Circular dt. 13.02.2003. Based on such a audit report show cause notices were issued to M/s. RIL by invoking extended period. M/s. RIL contested the issue on merits as well as on limitation. Adjudicating authority after following the due process of law confirmed the demands raised along with interest but did not impose any penalty on M/s. RIL. Aggrieved by such an order, appellant is ....
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....t that the adjudicating authority was correct in coming to the conclusion that the duty liability on the goods cleared from the factory premises during the material period, for captive consumption in appellants own unit has to be done as per the provision of Rule 8 of the Central Excise Valuation Rules, 2000. He would draw our attention to the Board Circulars which indicates that valuation has to be done based upon the provisions of Rule 8 of the Central Excise Valuation Rules, 2000. He would then submit that Hon'ble High Court of Madras in the case of Lakshmi Mills Co. Ltd. Vs. Assistant Commissioner of Central Excise, Coimbatore-III - 2009 (245) ELT 126 (Mad.) has held that value of goods captively consumed has to be determined, when the price is not sole consideration for sale, in accordance with Rule 8 of the Central Excise Valuation Rules, 2000. It is his further submission that the department has filed appeals against the impugned order for not imposing penalties on M/s. RIL. It is his submission that when adjudicating authority has held that M/s. RIL is liable to pay duty and interest, he should have imposed penalties as proposed in the show cause notice. 8. We have conside....
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....ith the words 'where the excisable goods are not sold'. This view is also supported by the judgment of the jurisdictional High Court in the case of Indian Drug Manufacturers Association v. Union of India, wherein the Court held that Rule 8 applies in a situation where goods are not sold but are cleared 'exclusively' to be used in consumption or for manufacture of other articles. We also agree with the contention of the assessee that Rule 8 will apply only in two situations, (a) where the goods are consumed by him in the same factory (captive consumption) or (b) where such goods are transferred to another factory for consumption in the manufacture of other articles on behalf of the assessee. In this case, it is not the case of the revenue that the goods were transferred to other units for manufacture of other articles on behalf of the assessee/appellant, i.e. the Dolvi Unit. We agree with the assessee's contention that the expression 'assessee', wherever it appears in the Central Excise Rules, applies to a particular factory, which is why different units belonging to one company are separately registered and separately assessed to duty. Since the assessee in the present case is the ....
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.... ultra vires the Act. 27. ................. 36. In our opinion, the Gunapradhan principle is fully applicable to the interpretation of Rule 9(2). Rule 9(2) is subservient to Section 14. We must, therefore, interpret it in such a way as to make it in accordance with the main object that is contained in Section 14 of the Customs Act. It may be that in isolation Rule 9(2) conveys some other meaning, but when it is read along with Section 14 of the Act, it must be given a meaning which is in accordance with the object of Section 14. The object of Section 14 is 'primary' whereas the conditions in Rule 9 (2) are the 'accessories'. The 'accessory' must, therefore, serve the 'primary'. 9. In view of what we have observed above, we answer the reference in the following terms : (a) the provisions of Rule 8 of the Valuation Rules will not apply in a case where some part of the production is cleared to independent buyers; (b) the provisions of Rule 4 are in any case to be preferred over the provisions of Rule 8 not only for the reason that they....