KALYANI FERROUS INDUSTRIES Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) M /s. Kalyani Ferrous Industries, have filed this Appeal against confirmation of demand and Central Excise duty and imposition of equivalent amount of penalty.

(2.) SHRI A.G. Kulkarni, learned Chartered Accountant, submitted that the Appellants manufacture pig iron on their account and also on conversion basis out of raw material supplied by the principal manufacturer namely Mukand Ltd. and M/s. Kalyani Steels Ltd.; that the South Regional Bench at Bangalore of Appellate Tribunal, vide Final Order No. 390 -94/2002, dated 15 -3 -2002 [2002 (148) E.L.T. 341 (T)] ordered issued that the valuation is required to be determined on the basis of costing data as per the Ujagar Prints - 1989 (39) E.L.T. 493 (S.C.) and not as per the sale price of goods sold on account of M/s. Kalyani Steel Ltd. by the Appellants to other independent buyers, since such prices would include the element of traders profit which can not be included in the assessable value to be determined on job work, goods as per clarificatory orders of the Supreme Court in the Ujagar Prints case. He, further mentioned that the assessable value determined by the Commissioner under the impugned order, is not being challenged by the Appellants; that they are only challenging the quantum of duty demanded from them and also that demand of duty is hit by time limit specified in Section 11A(1) of the Central Excise Act.

(3.) LEARNED Chartered Accountant submitted that the show cause notice was issued on 30 -6 -2000 for demanding Central Excise duty for the period from 19 -8 -1998 to 24 -1 -2000 and as such considerable period of demand of duty is beyond the normal period of six months; that the fact that they are the conversion job worker for both Mukund Ltd. and Kalyani Steels, was informed to the department in the form of price declaration dated 31 -8 -1998 i.e. before the very first transaction; that the said letter was acknowledged by the Department on 1 -9 -1998; that in the said declaration they had declared that the assessable value of Rs. 5,700 PMT has been considered on the basis of comparable market value of the goods; that further on 16 -6 -1999, the assessable value was revised to Rs. 5450 PMT due to change in the market price and declaration was also filed in the Department; that again the officers of Preventive Branch had sought for various details about transaction with their principal manufacturers which were furnished by them in the form of summary of pig iron and other items sold to the independent customers under their letter dated 15 -3 -1999; that in fact the Range Superintendent under letter dated 17 -2 -1999 had called upon the Appellants to furnish the details such as receipt of raw materials for conversion, agreement between the Appellants and the principal manufacturers and basis for fixing the assessable value of Rs. 5,700 by 26 -2 -1999 positively as a detailed report is to be submitted to the Divisional office; that details were submitted by them under their letter dated 11 -3 -1999 in which they also informed the basis for arriving at the assessable value of Rs. 5,700/ -; that in view of these letters, extended period of limitation can not be invoked.