TaxTMI 
TaxTMI 
2026 (5) TMI 750
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....her the Appellant is liable to include the cost of such free supply of goods in the assessable value. 2. The brief facts are on scrutiny of the documents, it is observed that for the period from August, 2010 to August, 2013, the Appellant has not included the value of parts /components /accessories supplied by their customer for computing the assessable value for payment of central excise duty which are used by them in the activity of designing, manufacturing and clearance of excisable goods like 'CNC machines' and 'Grinding' machines of various types. Thus, alleging undervaluation, proceedings were initiated and show cause notice dated 12.08.2014 was issued demanding duty and proposing penalty under various provision of ....
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....roduct, in this case TELCO, would therefore, be entitled not only to adjust the credit on the inputs supplied by it to the intermediate purchaser such as the appellant but also to the credit for the duty paid by the intermediate purchaser on its products. The reliance on the decision in Burn Standard Company Ltd. (supra) by the Tribunal was misplaced. That case has no doubt held that the value of the free inputs were to be included in the final product. In that case, the final product was wagons and the question was whether the items which were supplied free by the Railway Board to the assessee could be included in the value of the wagons. This Court came to the conclusion that it could. The first distinguishable feature is that this Court ....
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....inal product. In this regard, the Learned Chartered Accountant (CA) relied on the judgment of the Hon'ble Madras High Court in the matter of M/s. Madura Coats Pvt. Ltd Vs. CESTAT -2023 (7) CENTAX 144 (Mad) wherein it is held that Appellate Authority cannot go beyond the proposals made in the show cause notice. 5. The Learned CA further submits that when job worker clears the goods from their factory under Rule 4(5) of CENVAT Credit Rules, it is not necessary to follow the procedure laid down under Notification No. 214/86-CE dated 25.03.1986. The Appellant placed reliance on the decision of the Tribunal in the matter of M/s. Trico Process Pvt. Ltd Vs. CCE -2005 (189) E.L.T (126) for the above preposition. Reliance is also placed on follow....
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....s Plus GYR Ltd Vs. CCE 2013 (290) ELT 447 where it is held that:- "6. Heard both sides and perused the record. Undisputedly the appellant had received input services viz. GTA and Business Auxiliary Service and used the same in or in relation to the manufacture and trading of Electric Meters. It is also not in dispute that credit of Rs. 3,41,397/- availed by the appellant on the said input services were not exclusively used in or in relation to the manufacture of Electricity Meters, but also used for trading purposes. Admitting the said wrong availment of credit, being pointed out by C.E.R.A. Audit, the appellant had reversed it and also paid the interest on the same. It is also not in dispute that the show cause notice was issued t....
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....me Court in the case of Uniworth Textiles Ltd. -2013 (288) E.L.T. 161 wherein it was held that mere non-payment of duties is not equivalent to collusion or willful mis-statement or suppression of facts. When there is a bonafide belief, extended period of limitation cannot be invoked. Further it was held that the burden to prove that there was fraud, collusion, etc. lies on the department. In the instant case, the department has failed to discharge the burden. 9. Learned Chartered Accountant (CA) further submits that the Appellant has been regularly filing the monthly excise return. The details of such clearance were included in the monthly return filed for the period August 2010 to August, 2013. Thus, when the relevant details are disclo....
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....d the finding in the impugned order. 12. Heard both sides and perused the records. 13. As regards confirming the demand by invoking extended period of limitation, we find that as per the judgment of the Hon'ble Supreme Court in the case International Auto Ltd (supra), if the appellant had a bona fide belief that the value of material supplied by customers under Rule 4(5) of Cenvat Credit Rules, 2004 need not be included, extended period of limitation cannot be invoked. Further we find that as per the finding in the impugned order, it is held that Appellant had manufactured final products. However, there is no such allegation in the show cause notice that the intermediate product manufactured by the Appellant is final product. As r....