15 April 2016

Valuation – Cost of process carried out at job-worker’s premises after clearance

The Supreme Court has held that cost relating to bullet proofing of jeeps, undertaken outside the factory by job-workers after clearance of the not-yet bullet-proofed jeeps, is not to be included in the value of jeeps for the purpose of levy of Central Excise duty.

Affirming the Order of the CESTAT, the Apex Court in its order in the case of Commissioner v. Mahindra & Mahindra Ltd. in this regard noted that in the normal course, the jeeps are manufactured by the assessee without any such bullet proofing and it was only on a specific request by the Police department, jeeps were supplied after getting the bullet-proofing done from outside.


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