TaxTMI 
TaxTMI 
2025 (8) TMI 1139
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....ority took the view that the appellant should have followed the assessable value applicable to the 3rd party sales while clearing the goods to the related person. On this basis, he has confirmed the demand along with interest and penalty. Being aggrieved, the appellant is before the Tribunal. 2. The Learned Counsel appearing on behalf of the appellant submits that since the goods have been used by the related sister concern, the Adjudicating Authority is in error in taking the stand that assessable value should be based on the 3rd party transaction value. As a matter of fact, the Dept. should have taken the view that the price to be adopted should be as per Rule 8 of the Valuation Rules, 2000 which states that the price should be based on the total costing plus 10% profit margin since it is a clearance for captive consumption by the related person. 3. Further, he takes a stand that the duty paid by the appellant has been taken as Cenvat Credit by the receiving unit and the same was utilized for payment of Excise Duty for their finished goods. To this effect, he also produces a copy of the Chartered Accountant's Certificate stating that in respect of all the goods cleared by t....
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....gets clarified that the goods have been used for their own consumption by the receiving unit and they have taken the Cenvat Credit. Therefore, we agree with the submission of the appellant that this results in the Revenue neutral situation. In such cases, the appellant company would not derive any additional benefit on account of Excise Duty payment being lower as is being claimed by the Revenue. 10. On a similar issue, this Bench in the case of Shyam Sel & Power Ld. Vs. Commr. of CGST & Central Excise, Durgapur vide Final order No. 76865/2025 dated 09th July 2025 has held as under:- 7. Admittedly, there is no dispute that the clearances of the appellant is to their sister units. It is not also disputed by the Revenue that the Excise Duty paid by the appellant accrues as Cenvat Credit to the other units. The only dispute is with the regard to the Assessable Value adopted by the appellant. The Rule 8 of the Valuation Rules 2000, during the period of dispute reads as under: Rule 8. Where the excisable goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value shall be one h....
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....neutral. 9. We also find force in the Appellant's submissions that the Department has issued the Show Cause Notice in a belated way though all the details were available with the Department in view of their Monthly Returns being filed. Since the issue is that of revenue neutrality, in such a case, it has been held that the question of suppression would not arise. 10. Therefore, in view of the foregoing, we allow the appeals both on merits as well as on limitation. The Appellant would be eligible for consequential relief, if any, as per law. 15. Following the ratio of the cited case laws, we set aside the impugned order and allow the Appeal. (2024) 21 Centax 368 (Tri.-Cal) JSL LTD. Versus COMMISSIONER OF CENTRAL EXCISE, BHUBANESWAR-I Final Order No. 75264/Kol/2024 in Appeal No. E/70110/2013, decided on 9-2-202 9. We find that it is an admitted fact that it is a case of revenue neutrality, which means whatever duty has been paid by the appellant and the same is entitled as cenvat credit to the appellants themselves. 10. As it is a revenue neutral situation, we hold that no interest is payable by....
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....und on merits. 16. Coming to the submissions of the appellant on account of time bar, we find that for the period 2002 to 2005, the Show Cause Notice has been issued on 2.1.2007. It is not the case of the Dept. that the appellants have not been filing their statutory Returns like ER 1,wherein the value adopted by them would be reflected for the clearances made. Thus, there cannot be a case of suppression on their part. Further, the appellant has always been maintaining that since they are having third party independent clearances, they are not required to adopted costing plus 10 /15 percent procedure under Rule 8 of the Valuation Rules 2000. This stand is also supported by various case laws cited supra. Finally, when the situation is revenue neutral, there would be no specific gain to the appellant by adopting any lower assessable value. On this issue, the Supreme Court in the case of Nirlon Ltd Vs CCE Mumbai - 2015 (320) ELT 22 (SC), has held as under : 9. We have ourselves indicated that the two types of goods were different in nature. The question is about the intention, namely, whether it was done with bona fide belief or there was some mala fide intentions in....