Collector of C. Ex Vs. Jagatjit Cotton Textile Ltd. - Court Judgment

Excerpt:

.....has not earned any profit based upon their annual accounts for the years 1982-83 and 1983-84. shri vijay singh submitted that irrespective of the fact that the party has earned notional profit which was required to be added in terms of rule 6(b)(a) of the valuation rules. he contended that the collector (appeals) has not taken note of the appeal filed by the department in deciding the issue.shri vinod agarwal, learned advocate appearing for the respondent submitted that the issue of excisability referred to the items in question has already been decided by the tribunal as per order no.542/90-c, dated 29-5-1990 and accordingly, the item in question is not excisable. he also submitted it is not correct to say that the appeal filed by the department has not been taken note of by the collector (appeals) since same has already been disposed of by the collector (appeals) as per order no. 1405/ce/chd/91, dated 23-8-1991 wherein it was held that the item is not excisable.3. we have carefully considered the matter. in order no. 542/90-c, the tribunal has held that recovery of caprolactum does not amount to manufacture and accordingly, such caprolactum is not dutiable. since the item in.....

Judgment:

1. These are two Appeals filed by the Department against the common impugned order passed by the Collector (Appeals) involving a common issue and therefore, they are clubbed together and are being disposed of by the common order.

2. Shri Vijay Singh, the learned Senior Departmental Representative appearing for the Revenue submitted that the issue involved in this case is whether the margin of profit to be added to the goods captively consumed by the assessee, he submitted that the Assistant Collector had added 10% as margin of profit in determining the assessable value of the goods in terms of Rule 6(b)(2) of the Central Excise Valuation Rules but the Collector (Appeals) has accepted the plea of the party that margin of profit cannot be added in the instant case since the party has not earned any profit based upon their annual accounts for the years 1982-83 and 1983-84. Shri Vijay Singh submitted that irrespective of the fact that the party has earned notional profit which was required to be added in terms of Rule 6(b)(a) of the Valuation Rules. He contended that the Collector (Appeals) has not taken note of the appeal filed by the Department in deciding the issue.

Shri Vinod Agarwal, learned Advocate appearing for the respondent submitted that the issue of excisability referred to the items in question has already been decided by the Tribunal as per Order No.542/90-C, dated 29-5-1990 and accordingly, the Item in question is not excisable. He also submitted it is not correct to say that the Appeal filed by the Department has not been taken note of by the Collector (Appeals) since same has already been disposed of by the Collector (Appeals) as per order No. 1405/CE/CHD/91, dated 23-8-1991 wherein it was held that the item is not excisable.

3. We have carefully considered the matter. In order No. 542/90-C, the Tribunal has held that recovery of caprolactum does not amount to manufacture and accordingly, such caprolactum is not dutiable. Since the item in question is not dutiable, the question of adding profit does not arise as it was rightly argued by the party. Since the Department has not filed any appeal against the order of Tribunal and in view of the foregoing conclusion that recovery of caprolactum does not amount to manufacture, we accept the plea of the respondents and accordingly, we do not find any infirmity in the impugned order passed by the Collector (Appeals). In the result, these two Appeals filed by the Department are hereby dismissed.