IVRCL INFRASTRUCTURE AND Vs. C.C.E.

JUDGEMENT

(1.) As part of a work contract. the appellants manufacture pipes. They also discharge excise duty on the pipes at the time of removal from the factory of manufacture. Subsequently, the pipes were subjected to some processes like coating inner and outer side in order to prepare them for use in water supply scheme. Coating was at the work site. away from the factory of manufacturer. The Central Excise authorities have issued duty demand holding that cost of coating was also required to be included in the assessable value of the pipes. On account of that claim, duty demand of over Rs. 1.2 crores has been confirmed. There is also penalty of equal amount.

(2.) The contention of the appellant is that the duty demand is not legally sustainable inasmuch as costs incurred subsequent to removal of manufactured goods from a factory are not to form part of the assessable value of the goods. Learned counsel for the appellants has pointed out that this issue remains settled by the decision of the Hon'ble Supreme Court in the case of Siddharth Tubes Limited vs. C.C.E. 2002 -TAXINDIAONLINE -178 -SC -CX. Learned Counsel has also referred to Circular No. 139/08/2000 -CX.4 dated 3.1.2001 of the Central Board of Excise and Customs to show that the present duty demand is contrary to the legal position clarified in that Circular also.

(3.) We have perused the records and heard the learned SDR also. The method of valuation sought to be made in the present proceedings is clearly contrary to the aforesaid decision of the Supreme Court and the Circular of the C.B.E. and C. Such proceedings have to fail. Appeals are allowed after setting aside the impugned order.