Commissioner Of Central Excise, Jaipur vs M/S.Rajasthan Spg. & Wvg. Mills ...

The Supreme Court upheld the tribunal's decision that Rajasthan Spinning and Weaving Mills Ltd. (RSWML) was the real manufacturer and correctly invoked the cost method under Rule 6(b)(ii) of the Central Excise (Valuation) Rules, 1975. The Court noted that the lease agreement with Bhilwara Spinners Limited was genuine, rejecting the Department's claim that it was a sham to alter the basis of valuation. The Court clarified that even under the comparable goods method, as per Rule 6(b)(i), RSWML's valuation was appropriate under Section 4(1)(a) of the Central Excise Act, which defines the normal price for excisable goods.