ORDER
U.L. Bhat, J. (President)
1. Appellant is absent inspite of notice of hearing but has sent a request for decision on merits. We have heard Shri K. Srivastava, SDR and perused the papers.
2. Appellant received duty paid Motor Vehicle Parts specifically for industrial purpose under Chapter X procedure. The surplus motor vehicle parts left after use for specific industrial purpose were removed from the factory paying duty on the assessable value on which the manufacturer had paid duty earlier. Show cause notice was issued stating that duty should have been determined and paid on the assessable value of the surplus parts on the basis of wholesale price on the respective dates of removal and proposing demand of differential duty on that basis. Though, appellant resisted the notice, the Assistant Collector confirmed the demand and his order has been confirmed by Collector (Appeals). Hence the present appeal.
3. The appellant has relied on Final Order Nos. 768 and 769/86-B1, dated 3-12-1986 passed by the Tribunal in Appeal Nos. E/540/82-B1 and 2481/81-B1. The lower authorities held that order was passed in the light of Rule 196 on the Central Excise Rules, 1944 while the present case is governed by Rule 196A of the Rules and therefore the unreported order would not govern the facts of the present case. According to the appellant, the principle laid down in the unreported order would apply to the present facts also.
4. We will examine the Final Order Nos. 768 & 769/86-B. In that case, the present appellant obtained permission under Chapter X of the rules to bring non-duty paid Motor Vehicle Parts for use as original equipment in engines and Motor Vehicles. Rule 196 requires duty to be paid on those parts not duly accounted for. Some of the parts were used and rest were sold in the market and therefore duty became payable under Rule 196. Sub-rule (2) of Rule 196 of the Rules reads thus :-
“Where the duty becomes chargeable in terms of Sub-rule (i) on any excisable goods, the rate of duty and the tariff valuation, if any, applicable to such goods shall be the rate and valuation in force –
(i) in the case of actual removal of goods from the premises, on the date of such removal;
(ii) in the case of…, on the date on which the goods are received in the applicant’s premises;
(iii) in the case of…, on the date on which such loss is discovered by the proper Officer or made known to him;
(iv) in all other cases, on the date on which the notice of demand of duty is issued or on the date on which duty is paid, whichever is earlier.”
The four clauses prescribe different dates on which the rate of duty or tariff valuation is to be adopted. In the case of actual removal of goods, the date prescribed is the date of such removal. The Rule and the prescription are in respect of “rate of duty” and “tariff value” and not assessable value under Section 4(1) of the Central Excise Act, 1944. The Rule does not indicate on what assessable value or on the assessable value as on what date duty is to be paid. The absence of any such provision precludes the valuation of goods at any price except the price prevailing on the date of clearance of the goods by the manufacturer of the goods. This was what the Tribunal held in Order Nos. 768 &769/86-B1.
5. The question is whether the above principle is to be applied to a situation governed by Rule 196A of the Rules. Rule 196A(i) read as follows :-
“If any excisable goods obtained under Rule 192 become surplus to the needs of the applicant for any reason, the applicant may, with the previous approval of the proper Officer –
(i) Clear the goods on payment of duty, the rate of duty and the tariff valuation, if any, applicable to such goods being the rate and valuation, if any, in force on the date of actual removal of the goods from the appellant’s premises”;
6. Admittedly the present case is governed by Rule 196A since appellant cleared the surplus parts on payment of duty with the previous approval of the proper Officer. According to Clause (i) of Rule 196A, for the purpose of determining the duty payable on removal, the rate of duty and tariff valuation, if any, applicable to the goods will be the rate and valuation in force on the date of actual removal. Rule 196A(i) also does not indicate the date as on which the assessable value of the parts should be determined. In these circumstances, the price prevailing on the date of clearance by the manufacturer should be the basis for determination of assessable value on which the person removing the surplus goods to pay due. This principle laid down by the Tribunal in the earlier case of appellant under Rule 196 of the Rules would apply equally to the present case governed by Rule 196A of the Rules also. Therefore the demand for differential duty cannot succeed.
For the reasons indicated above, we set aside the impugned order and allow the appeal.