PRAKASH INDUSTRIES LTD. Vs. CCE

JUDGEMENT

(1.) THE Appellant is a manufacturer of Iron & Steel products namely Sponge iron, MS Blooms/Billets, Ingots, MS Runners & Risers etc. chargeable to Central Excise Duty under Chapter 72 of the Central Excise Tariff which are manufactured in their factory at Champa in District Janjgir -Champa. They are availing the benefit of Cenvat credit of duty paid on inputs and capital goods under Cenvat Credit Rules. They also have a factory at Raipur which uses the goods manufactured by the Appellant in their factory at Champa as inputs for manufacture of various steel products. The goods manufactured by the Appellant in their factory at Champa are partly sold by them at the factory gate to independent buyers and are partly cleared to their factory at Raipur for use in the manufacture of some finished products. The Appellant, during the period from 1.4.04 to 31.12.07 in respect of clearances to their unit at Raipur for captive consumption paid duty at the price at which the goods were sold to other independent buyers, while according to the Department, since as per the provisions of Section 4 of the Central Excise Act, 1944 (hereinafter referred to as the Excise Act), transaction value has to be determined for each removal, in respect of clearances for captive consumption to their unit at Raipur, assessable value should have been determined under proviso to Rule 9 read with Rule 8 of the Central Excise Valuation Rules, 2000 (hereinafter referred to as CEVR, 2000) on the basis of 110% of the cost of manufacture. It is on this basis that two show cause notices - SCN dt.14.1.2008 for 1.4.2004 to 28.2.2007 period and SCN dt.11.12.08 for 1.3.07 to Dec'07 period were issued for -

(2.) HEARD both the sides.

(3.) THE relevant portion of Section 4(1) of the Excise Act during the period of dispute is as under: