2017 (9) TMI 1056

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....anufacture of ultra-marine blue (bulk) falling under Chapter Sub-heading No.3206.90 of the Central Excise Tariff Act, 1985. Vide the impugned order, the Commissioner has confirmed a demand of duty amounting to Rs. 1,05,13,140/- with interest and equivalent penalty for the period October 1997 to June 2000 in respect of Ultramarine Blue Laundry grade in bulk pack of 50 kgs sent upon payment of Central Excise duty to the appellant s processor M/s Ultrapack at Hyderabad. According to Department, the appellant should have paid duty in terms of Rule 6 (b) (ii) of the Central Excise (Valuation) Rules, 1975. With reference to cost of production plus 10% notional profit and not in terms of Rule 6 (b)(i) of the Valuation Rules with reference to the p....

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....se, the proper officer shall make such adjustments as appear to him reasonable, taking into consideration all relevant factors and, in particular, the difference, if any, in the material characteristics of the goods to be assessed and of the comparable goods ; (ii) if the value cannot be determined under sub-clause (i), on the cost of production or manufacture including profits, if any, which the assessee would have normally earned on the sale of such goods." 5. The case of the appellant is that Rule 6 (b)(i) will be applicable. The appellant had purchased ultramarine blue in bulk from M/s Laxman Chemicals, who manufactured the goods according to the appellant s specification and value was adopted for payment of duty. However, the Dep....