TaxTMI 
TaxTMI 
2026 (6) TMI 948
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.... which sometimes extended beyond one year; at the initial stage the cost of the coaches was not ascertainable and hence, for initial clearances the assessable value at 110% of the cost of such coaches was adopted. After finalization of the cost reports for specific batches, the Appellant had claimed refund of the excess duty paid as the value of coaches after finalization was less than the value adopted in the invoice during relevant periods. 2. Entertaining a belief that the Appellant did not furnish any cost report signed by the registered Accountant, some of the claims were hit by time-bar, invoice did not have batch numbers or other particulars and that the Appellant had collected Proforma charges from Indian Railways which was not included in the value of coaches, for which reasons the refund claims required to be rejected, Show Cause Notices came to be issued. It appears from the record that the Appellant filed detailed explanation and also participated in the personal hearing granted while considering the refund claims and thereafter, vide various Orders-in-Original the Adjudicating Authority partly allowed and partly rejected the refund claims. Against the rejected claim....
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..... The coaches manufactured by the Appellant are supplied to Indian Railways for deployment in railway operations. The supplies are valued under Rule 8 of the Central Excise Valuation Rules, 2000 on cost of production basis. The value adopted at the time of clearance is based on estimated cost and remains liable to revision upon final determination of actual cost. The excess duty claimed as refund is thus a consequence of subsequent cost finalization and not on account of any commercial price variation. 9. The coaches supplied by the Appellant are not sold by Indian Railways as marketable goods. They are utilized as rolling stock for transportation operations. The Appellant has placed reliance on cost records and final cost statements to demonstrate that the excess duty arose solely on account of downward revision of the cost of production after finalization of batch costing. It is not the case of the Revenue and nor has the Revenue brought on record any material to establish that the incidence of such excess duty was recovered from any independent buyer or that the Appellant derived any commercial gain therefrom. 10. This Tribunal, in the Appellant's own case in Excise Ap....
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....f production. It is the case of the Appellant that the excess payment became ascertainable only upon finalization of actual cost and, therefore, refund ought to be considered with reference to such date. Though the submission has considerable and equitable force, but the statutory scheme under Section 11B does not permit acceptance thereof in the facts of the present case for the following reasons : 14. Section 11B prescribes a limitation period of one year from the relevant date. In the absence of provisional assessment under Rule 7, the assessments made at the time of removal are required to be treated as 'final assessments'. Refund of excess duty paid in such circumstances could thus be claimed only under Section 11B subject to fulfilment of the conditions and limitation prescribed therein. 15. No statutory provision has been brought to notice under which the date of finalization of actual cost could be treated as the 'relevant date' for the purposes of Section 11B where assessments were never made provisional in accordance with Rule 7. The substantive right to seek refund may survive; however, in the absence of provisional assessment, the remedy can only be pursued under ....
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....ant of correlation between invoices and batch-cost records. It is the case of the Revenue that the refund claims are not capable of verification since the invoices did not contain batch numbers or cost-sheet references and, therefore, the excess duty paid cannot be correlated with the clearances in question. We are unable to accept this contention as a ground for outright rejection of the refund claims. It is not in dispute that the Appellant has consistently followed a batch-costing system under which the final cost of production is determined only after completion of manufacture and clearance of the relevant batch of coaches. It is also not in dispute that whenever such finalization resulted in enhancement of cost the consequential differential duty liability was accepted and discharged on the basis of the same costing methodology and supporting records. Hence, having accepted the very same methodology for determination and recovery of differential duty, the Department cannot reject the methodology itself for refund purposes solely on the ground that batch numbers were not reflected on the invoices, unless it is demonstrated that the claims are incapable of verification or that t....
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....lways but however, such internal/departmental instructions cannot override the valuation framework prescribed under the Central Excise Act and the Valuation Rules framed thereunder. 25. Excise duty being a levy under a fiscal statute, assessable value must necessarily be determined in accordance with the statutory provisions governing valuation. Accordingly, we hold that valuation for the purposes of Rule 8 is required to be determined on the basis of CAS-4 alone and certainly not on the sole basis of Chapter 13 of the Indian Railway Code. 26. Last issue is about the Refund relating to spares. We find from the records that the Commissioner (Appeals), while passing the impugned order, has held that the Appellant was not eligible for refund in respect of spares amounting to Rs.34,44,404/- for which he has placed reliance upon TRU Letter F. No. 334/1/2012-TRU dated 01.06.2012. We find that the Appellant has not specifically assailed the said finding in the present Appeals. No independent ground has been raised challenging denial of refund in respect of spares, nor were any substantive submissions advanced before this Tribunal on that issue. In the absence of any specific challen....