2026-VIL-596-CESTAT-BLR-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise – Valuation, Import of plastic granules and sale of job-worked finished goods - The appellants imported plastic granules duty-free through the Target Plus Scheme and sent them to job workers for conversion into various plastic products. The finished goods were then sold to the job workers themselves - Department rejected the transaction value declared by the appellants and redetermined the assessable value under Rule 11 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - Whether the transaction value declared by the appellants on sale of job-worked finished goods to the job workers should be determined under Rule 10A(i) or Rule 11 of the Central Excise Valuation Rules - HELD - The method of valuation to be adopted in the present case, where the finished goods are sold to the job workers, is Rule 10A(i) of the Central Excise Valuation Rules. This rule provides that where the excisable goods are produced or manufactured by a job-worker on behalf of a principal manufacturer, and the goods are sold by the principal manufacturer to the buyer who is not related and the price is the sole consideration, the value shall be the transaction value. There was no bar under the Rules to sell the finished goods to the job worker after charging the full price, which includes the cost of material, conversion charges and margin of profit as agreed. The price charged by the appellants was duly supported by CAS-4 certificates, and the addition of profit margin by the Department by adopting lowest purchase price and highest selling price to determine the margin of profit cannot be sustained being not supported by the law laid for valuation or supported by the accounting principles - The impugned order is set aside and the appeal is allowed
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