S. PETER Vs. COMMISSIONER OF C. EX., BELGAUM

JUDGEMENT

(1.) THIS appeal arises from Order -in -Original No. 8/2005, dated 15 -2 -2005 by which the demands have been confirmed by the Commissioner including imposition of penalty on the ground of allegation of clandestine removal of goods; valuation of the goods declared by them has not been accepted as normal price in terms of Section 4(1)(b) of the C.E. Act. The evidence pertaining to clandestine removal is the difference of figures shown in RG -1 Register and the Balance Sheet for the years 1994 -95 to 1998 -99. With regard to the allegation of valuation, there has been escalation of prices and as such the Revenue has proceeded to enhance the value on the allegation of suppression of facts.

(2.) THE contention of the appellant is that they are paying the duty on the ex -factory price as determined by the Cost Construction Method and Provisions of 4(i)(a) of Valuation Rules (sic). They contended that the Department was aware of the fact that the assessable value of their products had been based on Cost Construction Method and the RT -12 returns were duly assessed. They pointed out that the certificates issued by the Chartered Accountant disclosed that there was revision on the higher side in the each year and that designing, drawing, etc., was done at the site, laying, jointing, commissioning, testing, etc., were done at the site after clearance and that nuts, hard crates and rings were also required at site and therefore, the said value cannot be added in the value of pipes. They also contended that the goods were not comparable and the data rate of PSC pipes cannot form the basis for determining the value of their product and there could be variation in the overhead charges, labour charges, etc., from manufacturer to manufacturer. They contended that escalation charges were not for manufacturing activity alone but for other items of work not connected with manufacture of PSC pipes. They also contested the allegation that figures shown in the Balance Sheet should not be the basis for ascertaining the allegation of clandestine removal. They also pleaded to treat the values cum -duty and grant them the benefit of time -bar. As the facts were known to the Department, there was no suppression or misdeclaration of facts and therefore, penalty and interest is not leviable. However, the Commissioner has rejected all their pleas by upholding the charges and confirming the demands and has imposed penalties.

(3.) THE learned Counsel submitted that in an identical matter of their competitor industry, similar allegations have been raised pertaining to allegation of clandestine removal of pipes and non -accountable in RG1 Register and the figures shown in the Balance Sheet were taken to show that there was clandestine removal. In that case also the valuation had been revised. He submits that this Bench after due consideration in the case of Karnataka Cement Pipes Factory v. CCE by Final Order Nos. 757 and 758/2005, dated 20 -10 -2005 [2006 (206) E.L.T. 215 (Tribunal)] disagreed with the assessees contention pertaining to the escalation charges not to be added in the assessable value. The Tribunal set aside the demands on allegation of clandestine removal based solely on the figures shown in the Balance Sheet in the light of several judgments of the Tribunal. The Tribunal also remanded the matter to grant the benefit of cum -duty and rework out the same. The learned Counsel submits that in this case, they are contesting the confirmation of duty on larger period, as all the details have been disclosed to the Department. Therefore, he submits that the benefit of the Final Order Nos. 757 and 758/2005, dated 20 -10 -2005 [2006 (206) E.L.T. 215 (Tribunal)] rendered in the case of Karnataka Cement Pipes Factory be granted to them.