Central Excise (Valuation) Rules,1975

From Advocatespedia, ASSN: 24869
Jump to navigation Jump to search
Central Excise (Valuation) Rules,1975
Total Sections 11
Enforcement Year 1975
State or Central Central
Editor Template:USERNAME
ASSN: 24869


CENTRAL EXCISE (VALUATION) RULES, 1975

CONTENTS 
CHAPTER 1 :- PRELIMINARY 
1. Short title and commencement
2. Definitions
CHAPTER 2 :- DETERMINATION OF VALUE 
3. Rule 3 
4. Rule 4 
5. Rule 5
6. Rule 6 
7. Rule 7 
8. Rule 8 
9. Rule 9 
10. Rule 10 
10A. Rule 10A 
11. Rule 11 

CENTRAL EXCISE (VALUATION) RULES, 1975

In exercise of the powers conferred by Section 37 of Central Excises and Salt Act, 1944 (1 of 1944), the Central Government hereby makes the following rules, namely:

CHAPTER 1 PRELIMINARY 
1. Short title and commencement :

(1) These rules may be called the Central Excise (Valuation) Rules, 1975 . (2) They shall come into force on the 1st October, 1975.

2. Definitions :

In these rules, unless the context otherwise requires, (a) Act means the 1 [ Central Excise Act, 1944 ) (1 of 1944); (b) "proper officer means the proper officer as defined in clause (xi) of rule 2 of the Cental Excise Rules, 1944 ; (c) value means the value under Section 4 of the Act; (d) words and expressions used in these rules and not defined but defined in the Act shall have the meanings respectively assigned to them in the Act.

1. Substituted by M.F. (D.R.B.) Notification No. 258/76-C.E., dated 9th October, 1976.

CHAPTER 2 DETERMINATION OF VALUE

3. Rule 3 :

The value of any excisable goods shall, for the purposes of clause (b) of sub-section (1) of Section 4 of the Act, be determined by the proper officer in accordance with these rules.

4. Rule 4 :

The value of the excisable goods shall be based on the value of such goods sold by the assessee for delivery at any other time nearest to the time of the removal of goods under assessment, subject, if necessary, to such adjustment on account of the difference in the dates of delivery of such goods and of the excisable goods under assessment, as may appear reasonable to the proper officer.

5. Rule 5 :

Where the excisable goods are sold in the circumstances specified in clause (a) of sub-section (1) of Section 4 of the Act except that the price is not the sole consideration, the value of such goods shall be based on the aggregate of such price and the amount of the money value of any additional consideration flowing directly or indirectly from the buyer to the assessee.

6. Rule 6 :

If the value of the excisable goods under assessment cannot be 1 Central Excises and Salt Act, 1944 renamed by Section 71 of the Finance (No. 2) Act, 1996 (33 of 1996). determined under rule 4 or rule 5, and (a) where such goods are sold by the assessee in retail, the value shall be based on the retail price of such goods reduced by such amount as is necessary and reasonable in the opinion of the proper officer to arrive at the price at which the assessee would have sold such goods in the course of wholesale trade to a person other than a related person : [Provided that in determining the amount of reduction, due regard shall be had to the nature of the excisable goods, the trade practice in that commodity and other relevant factors;] (b) where the excisable goods are not sold by the assessee but are used or consumed by him or on his behalf in the production or manufacture of other articles, the value shall be based (i) on the value of the comparable goods produced or manufactured by the assessee or by any other assessee : Provided that in determining the value under this sub-clause, the proper officer shall make such adjustments as appear to him reasonable, taking into consideration all relevant factors and, in particular, the difference, if any, in the material characteristics of the goods to be assessed and of the comparable goods; (ii) if the value cannot be determined under sub-clause (i), on the cost of production or manufacture including profits, if any, which the assessee would have normally earned on the sale of such goods; (c) where the assessee so arranges that the excisable goods are generally not sold by him in the course of wholesale trade except to or through a related person and the value cannot be determined under clause (iii) of the proviso to clause (a) of sub-section (1) of Section 4 of the Act, the value of the goods so sold shall be determined- (i) in a case where the assessee sells the goods to a related person who sells such goods in retail, in the manner specified in clause (a) of this rule; (ii) in a case where a related person does not sell the goods but uses or consumes such goods in the production or manufacture of other articles, in the manner specified in clause (b) of this rule; (iii) in a case where a related person sells the goods in the course of wholesale trade to buyers, other than dealers and related persons, and the class to which such buyers belong is known at the time of removal, on the basis of the price at which the goods are ordinarily sold by the related person to such class of buyers.

7. Rule 7 :

If the value of excisable goods cannot be determined under the foregoing rules, the proper officer shall determine the value of such goods according to the best of his judgment, and for this purpose he may have regard, among other things, to any one or more of the methods provided for in the foregoing rules.

1 [THE SCHEDULE***] 1. Omitted by M.F. (D.R.B.) Notification No. 258/76-C.E., dated 9th October, 1976.

8. Rule 8 :

Where the excisable goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value shall be one hundred and ten per cent of the cost of production or manufacture of such goods.

9. Rule 9 :

When the assessee so arranges that the excisable goods are not sold by an assessee except to or through a person who is related in the manner specified in either of sub-clauses (ii), (iii) or (iv) of clause (b) of sub-section (3) of section 4 of the Act, the value of the goods shall be the normal transaction value at which these are sold by the related person at the time of removal, to buyers (not being related person); or where such goods are not sold to such buyers, to buyers (being related person), who sells such goods in retail : Provided that in a case where the related person does not sell the goods but uses or consumes such goods in the production or manufacture of articles, the value shall be determined in the manner specified in rule 8.

10. Rule 10 :

When the assessee so arranges that the excisable goods are not sold by him except to or through an inter-connected undertaking, the value of goods shall be determined in the following manner, namely : (a) If the undertakings are so connected that they are also related in terms of sub-clause (ii) or (iii) or (iv) of clause (b) of sub-section (3) of section 4 of the Act or the buyer is a holding company or subsidiary company of the assessee, then the value shall be determined in the manner prescribed in rule 9. Explanation. - In this clause "holding company" and "subsidiary company" shall have the same meanings as in the Companies Act,1956 (1 of 1956). (b) in any other case, the value shall be determined as if they are not related persons for the purpose of sub-section (1) of section 4.

10A. Rule 10A :

Where the excisable goods are produced or manufactured by a jobworker, on behalf of a person (hereinafter referred to as principal manufacturer), then, (i) in a case where the goods are sold by the principal manufacturer for delivery at the time of removal of goods from the factory of jobworker, where the principal manufacturer and the buyer of the goods are not related and the price is the sole consideration for the sale, the value of the excisable goods shall be the transaction value of the said goods sold by the principal manufacturer; (ii) in a case where the goods are not sold by the principal manufacturer at the time of removal of goods from the factory of the job-worker, but are transferred to some other place from where the said goods are to be sold after their clearance from the factory of job-worker and where the principal manufacturer and buyer of the goods are not related and the price is the sole consideration for the sale, the value of the excisable goods shall be the normal transaction value of such goods sold from such other place at or about the same time and, where such goods are not sold at or about the same time, at the time nearest to the time of removal of said goods from the factory of job-worker; (iii) in a case not covered under clause (i) or (ii), the provisions of foregoing rules, wherever applicable, shall mutatis mutandis apply for determination of the value of the excisable goods : Provided that the cost of transportation, if any, from the premises, wherefrom the goods are sold, to the place of delivery shall not be included in the value of excisable goods. Explanation. - For the purposes of this rule, job-worker means a person engaged in the manufacture or production of goods on behalf of a principal manufacturer, from any inputs or goods supplied by the said principal manufacturer or by any other person authorised by him.

11. Rule 11 :

If the value of any excisable goods cannot be determined under the foregoing rules, the value shall be determined using reasonable means consistent with the principles and general provisions of these rules and sub-section (1) of section 4 of the Act.