No amortization on additional supplies when cost fully amortized on initial supply

Lakshmi Machine Works Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)

Cost fully amortized – additional casting cleared using same pattern – demanding continuation of amortization on additional casting legally unsustainable.

Facts-

The appellant received patterns from their customers to whom they supply the casting manufactured using the patterns. In one of the order the total cost of pattern was amortized and accordingly the appellant did not took into consideration the value of pattern while clearing the additional order.

To that, department contended that the appellant failed to include the amortized cost of patterns in respect of additional clearance in contravention of rule 4, 6 and 8 of Central Excise (No. 2) Rules, 2001.

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