Assessable value under excise law excludes excess freight and insurance unless it forms part of the goods' price.

Excess freight and insurance charges collected by an assessee are not includible in assessable value under Section 4 of the Central Excise and Salt Act, 1944 unless the department establishes that the excess forms part of the price of the goods. The Tribunal treated excise as a levy on manufacture, not on profit earned from transportation, and found no evidence that the excess freight represented any component of goods value. The point was also considered covered by earlier decisions and the departmental circular distinguishing excise assessable value from F.O.B. value for customs and export incentive purposes, so the departmental appeal failed.

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Issues: Whether excess freight and insurance charges collected by the assessee were includible in the assessable value under Section 4 of the Central Excise and Salt Act, 1944.

Analysis: The assessable value under Section 4 was the only issue in dispute. The record showed no evidence that the excess freight represented any part of the value of the goods. Excise duty is a levy on manufacture and not on profit earned by a dealer on transportation. The Tribunal also noted that the point stood covered by earlier decisions and the departmental circular, which distinguished assessable value for excise purposes from F.O.B. value for customs and export incentive purposes.

Conclusion: The excess freight and insurance charges were not includible in the assessable value, and the departmental appeal failed.

Ratio Decidendi: Excess freight and insurance collected in excess of actual expenditure are not includible in assessable value unless the department establishes that such excess represents part of the price of the goods.

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