TaxTMI 
TaxTMI 
2010 (8) TMI 906
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....mmon order. 2. The relevant facts that arise for consideration are during the relevant period (July 2002 to March 2003) the appellants were manufacturing cotton yarn and were clearing the same to their own unit who consumed the same in the manufacture of other articles on behalf of the appellants. The appellants have been discharging the duty liability on the said goods based upon and in accordance with Rule 8 of the Central Excise Valuation Rules, 2000 (herein after called as Rules). On scrutiny of the annual cost audit report of the assessee, the lower authorities felt that the assessable value adopted by the appellant for discharging duty liability for clearances of cotton yarn to their own unit, was found to be lesser, compared ....
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....onciliation with the financial accounts and the cost of production which is arrived at is only after considering the various miscellaneous incomes. It is his submission that determination of the value of the goods manufactured on job work basis is in terms of Rule 11 of the Central Excise Rules read with the principle laid down by the Hon'ble Supreme Court in the case of Ujagar Prints etc. v. UOI [1989 (39) E.L.T. 493 (S.C.)] and further clarificatory judgment. It is his submission that the value determined in terms of Rule 11 of the said rules would in fact be less than the value considered by the assessee for the discharge of the duty liability. It is his submission that the larger bench decision of the Tribunal in the case of Prafful Ind....
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.... the appellants themselves. It is his submission that duty liability is on a monthly basis and cost audit report is available only after the end of the financial year hence the proper method should have been to adopt the provisional costing method and then pay the differential duty after getting the cost audit report. It is his submission that the responsibility is entirely on the assessee and if they did not do it, it is clear case of malafide with intent to evade duty. He would submit that the job work valuation as per CBEC Circular No. 619/10/02-CX., dated 19-2-2002 which is relied upon by the appellant is also to be done under provisions of Rule 11 read with Rule 6 and consequently the liability has been correctly upheld by the first ap....
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....ed rule that this rule comes into play when the goods are cleared for consumption to their own unit or on their behalf. Since it is undisputed that the processed yarn cleared from the appellant's factory is consumed by their own sister concern, provisions of Rule 8 of the said rules will apply. The appellants have been submitting the cost certificates to the authorities. The said cost certificates were of the cost of production on the manufacture of such goods. Both the lower authority's finding that the said CAS-4 certificates could not be computed for each consignment at the time of clearance, does not mean that the assessee is at liberty to remove the goods to a related person on an approximate value, seems to be incorrect as if it is un....
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....penses etc., and as per clarifications given, provisions of Rule 8 of the said rules, mandated discharge of duty on the cost of production as per CAS-4, which considers expenses incurred in the factory of production and the cost of production worked out by CAS-4 should be adopted for discharge of duty liability. To our mind the reliance placed by the lower authorities on the cost of production of the products i.e. processed yarn seems to be improper as that includes various other expenses which are not to be considered for the purposes of arriving at the cost of production of the processed yarn cleared for captive consumption or on job work basis. In view of this, we are of the considered view that the cost adopted by the assessee based upo....