TaxTMI 
TaxTMI 
2018 (7) TMI 159
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.... independent buyers. However, a small portion of the goods manufactured are also sold by the appellant to M/s. Caldyne Automatics Ltd. which is a subsidiary unit of the appellant. The dispute during the period April, 2001 to December, 2006 relates to the valuation of goods cleared by the appellant to its subsidiary. The duty on such clearances was paid on the basis of mutually agreed price. The department was of the view that since the subsidiary has further sold the batteries at higher price, excise duty was required to be paid at the price at which said subsidiary is selling the goods to independent buyers. Accordingly, show cause notice was issued. The demand of central excise duty has been confirmed along with interest and penalty. Aggr....
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....n has sold the goods at higher price, but duty has been paid at the time of clearance at mutually agreed price which is claimed to be the price at which goods are sold to independent persons. The view of the department is that central excise duty is required to be paid, in terms of Rule 10 of the Valuation Rules, 2000 at the price at which the subsidiary sells the goods to independent buyers. In this connection we note that the applicability of Rule 10 of the Central Excise Valuation Rules, 2000 and the circumstances in which it can be applied have been clarified by the CBEC vide their Circular dated 01.07.2012, in question No.12 which is reproduced here for ready reference. 12. How will valuation be done when godos are sold parly to relat....