COMMR. OF C. EX. Vs. ELECTROLUS KELVINATOR LTD.

JUDGEMENT

(1.) THIS appeal has been preferred by the revenue proposing following question of law:

(2.) CASE of the revenue is that the assessee was clearing parts of washing machines to its own branches/service centres and such parts were being sold on actual cost of spares. Under Rule 8 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000, assessable value should be taken at 115% of the cost of goods if the goods are not sold in open market. There was short levy of excise duty. The assessee voluntarily debited the amount of short levy with interest. The assessee was receiving inputs from small scale manufacturers by paying concessional rate of Central Excise duty i.e. 9.6% though the rate applicable was 12.8%. There was, thus, short levy. The assessee debited the said duty with interest voluntarily. The adjudicating authority confirmed the demand of duty with interest and imposed penalty of Rs. 1,30,301/ -. The Commissioner (Appeals) upheld the view of the adjudicating authority. The Tribunal set aside the penalty holding that duty having been paid prior to issuance of show cause notice, imposition of penalty was not justified.

(3.) WE have heard learned Counsel for the revenue.