TARA INDUSTRIES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) These two appeals raise a common question. The method of valuation of goods produced on job work basis.

(2.) The appellants manufacture 'Wool Tops' on job work basis out of raw wool received from parties for whom the job work is undertaken. They worked out the assessable value (for Central Excise purposes) of wool tops as the aggregate of the cost of raw material and their job work charges and paid duty on the basis of such assessable value. Under the impugned order, differential duty has been demanded on the basis that the goods should have been valued under Rule 8 of the Central Excise Valuation Rules, 2000 which came into force w.e.f. 1 -7 -2000. We read that Rule :

(3.) It is clear from the above two paras of the Circular that goods produced on job work basis are required to be valued according to the rule laid down by the Apex Court's judgment in the case of Ujagar Prints Ltd. - [1989 (39) E.L.T. 493 (S.C.)] even after 1 -7 -2000. The original valuation and payment of duty took place according to the principle of valuation approved by the Apex Court. The impugned orders are contrary to the specific provisions of valuation rules as well as clarification issued by the Central Board of Excise and Customs. They are required to be set aside. We do so and allow the appeals. In view of our disposing of the appeals themselves, stay petitions do not survive.