Anuja Laboratories Vs. Commissioner of Central Excise - Court Judgment

Excerpt:
1. the above appeals have been taken up for consideration with the consent of both the parties after waiving the pre-deposit.2. these are appeals filed by job workers who manufacture ayurvedic medicaments. some of the goods they manufacture are ultra slim fast, love care, kvex gold. they obtain orders from loan licensee m/s. k.v.health care products pvt. ltd. m/s. k.v. health care products pvt. ltd. placed orders to produce the above items. they also supplied raw-materials. a price list was filed by the appellant giving price at which the goods were sold by m/s. k.v. health care products pvt. ltd. duty was paid at the rate of 10% of the value. show cause notices were issued and the asstt. commissioner confirmed the demands at an higher value that is the value on which the goods were sold by m/s. k.v.health care products pvt. ltd. appeals were filed before the collector (appeals), mumbai who by the impugned order rejected the contentions of the appellant. hence, the present 4 appeals.3. shri patil, ld. advocate along with shri arun metha, ld. advocate argued that the appellate authority has not passed a speaking order inasmuch as the grounds taken before him were not considered and they were not reflected in the impugned order. one of the grounds raised by them is regarding the application of rule 6(b)(ii) of valuation rules, 1975. he also raised other contentions.4. shri c.p. rao, the ld. sr. departmental representative adopts the reasonings of the lower authorities.5. we have considered the rival submissions. in cases of these types it is settled law that the value at which the goods should be assessed should be the value which the job worker makes on the manufactured goods. this is settled by the decision of the supreme court in ujagar prints v. union of india -1989 (39) e.l.t. 493 (s.c.). the lower authorities have failed to look into the aspect of rule 6(b)(ii) of the valuation rules. we, therefore, hold that the value for purpose of valuation would be the cost at which the goods are manufactured. in other words, the dictum laid down by the supreme court in ujagar prints referred to above has to be followed. we, therefore, set aside the impugned order and remand the matter to the jurisdictional asstt.commissioner for readjudication in the light of our observations above.appeals are allowed and sent back by way of remand to the jurisdictional asstt. commissioner.

Judgment:
1. The above appeals have been taken up for consideration with the consent of both the parties after waiving the pre-deposit.

2. These are appeals filed by job workers who manufacture ayurvedic medicaments. Some of the goods they manufacture are Ultra slim fast, Love care, Kvex gold. They obtain orders from loan licensee M/s. K.V.Health Care Products Pvt. Ltd. M/s. K.V. Health Care Products Pvt. Ltd. placed orders to produce the above items. They also supplied raw-materials. A price list was filed by the appellant giving price at which the goods were sold by M/s. K.V. Health Care Products Pvt. Ltd. Duty was paid at the rate of 10% of the value. Show cause notices were issued and the Asstt. Commissioner confirmed the demands at an higher value that is the value on which the goods were sold by M/s. K.V.Health Care Products Pvt. Ltd. Appeals were filed before the Collector (Appeals), Mumbai who by the impugned order rejected the contentions of the appellant. Hence, the present 4 appeals.

3. Shri Patil, ld. Advocate along with Shri Arun Metha, ld. Advocate argued that the Appellate Authority has not passed a speaking order inasmuch as the grounds taken before him were not considered and they were not reflected in the impugned order. One of the grounds raised by them is regarding the application of Rule 6(b)(ii) of Valuation Rules, 1975. He also raised other contentions.

4. Shri C.P. Rao, the ld. Sr. Departmental Representative adopts the reasonings of the lower authorities.

5. We have considered the rival submissions. In cases of these types it is settled law that the value at which the goods should be assessed should be the value which the job worker makes on the manufactured goods. This is settled by the decision of the Supreme Court in Ujagar Prints v. Union of India -1989 (39) E.L.T. 493 (S.C.). The lower authorities have failed to look into the aspect of Rule 6(b)(ii) of the Valuation Rules. We, therefore, hold that the value for purpose of valuation would be the cost at which the goods are manufactured. In other words, the dictum laid down by the Supreme Court in Ujagar Prints referred to above has to be followed. We, therefore, set aside the impugned order and remand the matter to the jurisdictional Asstt.

Commissioner for readjudication in the light of our observations above.

Appeals are allowed and sent back by way of remand to the jurisdictional Asstt. Commissioner.