I set aside the impugned Order and the respondent to finalise

the matter based on order of the larger Bench of Hon’ble CESTAT

in the case of Ispat Industries Ltd. vs Commissioner of C Ex.,

Raigad [2007 (209) ELT 0185 (T-LB)]. Appeal is accordingly

disposed off.”

2.1

The Appellants are, inter alia engaged in the manufacture

of Motor Vehicles and their parts thereof, falling under Chapter

E/85450/2013

2

84 and Chapter 87 of the First Schedule to the Central Excise

Tariff Act, 1985.

2.2

The Appellants cleared motor vehicle parts to their sister

units located at Nagpur, Rudrapur and Jaipur on inter-plant

transfer basis, which are captively used by them for manufacture

of final product. The Appellants cleared such parts of motor

vehicles to the sister units by paying excise duty on values

arrived at under Rule 8 of the Central Excise Valuation

(Determination of Price of Excisable Goods) Rules, 2000 [in short

Valuation Rules] i.e., 115% of cost of production.

2.3

The Appellants were issued a Show Cause Notice, wherein

duty demand of Rs. 6,96,943/- was raised on the parts of motor

vehicles cleared to sister units on the ground that the Appellants

have not included the element of R&D Expenses, Head office

Administrative overheads, Interest, and proportionate profit

margin of these elements, while determining the assessable

value of their manufactured goods cleared to their own unit for

captive consumption. The said proposal of demand was

confirmed vide Order-in-Original dated 8.10.2002. However, the

Commissioner (Appeals) remanded the matter for de novo

adjudication, allowing exclusion of the Head Office expenses

from

assessable

value

vide

Order-in-Appeal

31.7.2003.

2.4

Deputy Commissioner passed Order-in-Original dated

1.10.2004 and re-determined the assessable value after adding

the expenses such as interest, R&D expenses and proportionate

profit margin on such amount and confirmed the demand of Rs.

4.16.942/- with interest and imposing equal amount of penalty.

The Commissioner (Appeals) upheld the Order dated 1.10.2004

vide Original-in-Appeal dated 26.8.2005. However, the Hon'ble

Tribunal vide Order dated 15.12.2005 remanded the matter back

to the original authority for re-determination of the assessable

value as per CAS-4 in the light of the case of National Aluminium

Co. Ltd. Vs. CCE-2005(184) ELT 183.

2.5

Thereafter, vide Order-in-Original dated 7.9.2006, the

Deputy Commissioner allowed deduction of only interest and

confirmed a demand of Rs. 1,93,463/- with interest and penalty,

holding

that

Research

and

Development

cost

and

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3

proportionate profit margin are includable in the assessable

value of the goods manufactured and transferred by the

appellants to their other units.

2.6

Appellant challenged the order before Commissioner

(Appeals). By the impugned Commissioner (Appeals) disposed of

the appeal filed. Aggrieved appellants have filed this appeal.

3.1

We have heard Shri Rajesh Ostwal, Advocate for the

Appellant and Shri P K Acharya, Superintendent, Authorized

representative for the revenue.

3.2

Arguing for the appellant learned counsel submits that:

 The present issue is no longer res integra in view of the

Hon'ble Tribunal's judgment passed in the Appellant's own

case vide Final Order No. A/86265-86269/2022 dated

22.11.2022. The facts and allegations in the said judgment

cited supra are identical to the facts and allegations of the

present case. The Hon'ble Tribunal in the judgment cited

supra decided the matter in favour of the Appellant.

 Hon'ble CESTAT in the following decisions including

judgments in the Appellant's own case, has considered the

issue whether goods manufactured, and stock transferred

to the sister unit has to be valued as per Rule 8 or Rule 4

of Valuation Rules, 2004. Period involved in the following

decision is prior to November 2011. In these decisions, the

Hon'ble CESTAT after considering Rule 8 as existing pre

and post amendment as well as decision of Larger Bench

of Hon'ble CESTA