Case Law Details
Star Boxes India (P) Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai held that differential duty demand unsustainable as invoices for purchase of raw materials and invoices for clearances of finished products indicate that the appellant is an independent manufacturer.
Facts- The appellants are engaged in manufacture of carton boxes falling under Chapter 48 of CETA, 1985. Based on the intelligence that the appellant was not adopting the correct assessable value in respect of their clearances made to M/s.Mira Textiles and Industries (I) Ltd., documents and records were verified. It was noticed that appellant was getting the kraft paper (raw material) under the cover of Central Excise invoices from M/s.Mira and after availing the credit of craft paper, the same was being converted into carton boxes (finished products).
The department was of the view that the appellant is manufacturing carton boxes as a job work for and on behalf of M/s.Mira Textiles. The price adopted by the appellant was only the cost of production at their hand as evidenced from the cost sheet prepared. The goods were sold by Mira to other customers. There was a difference in the sale price of the goods adopted by M/s.Mira Textiles when compared with the sale price of the appellant to M/s.Mira Textiles. The department was of the view that amount received by the appellant was only compensation of the expenditure incurred by them and received by them through the sale invoices raised.
It appeared to the department that the appellant had simply been acting as a job worker for M/s.Mira Textiles (who is the principal manufacturer) and the value adopted for payment of duty was not the sole consideration for sale as required u/s. 4 (1) (a) of Central Excise Act, 1944. Hence the valuation was required to be determined as per Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 u/s. 4 (1) (b) of Central Excise Act, 1944.
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