Excise valuation at time of removal governs assessable value; later deterioration does not reduce duty liability.

For excisable goods, assessable value under Section 4 of the Central Excise Act, 1944 is determined by the normal price prevailing at the time and place of removal. Later deterioration in storage and a lower resale price on domestic sale do not alter the assessable value or duty liability, because central excise is a levy on production and valuation must follow the ex-factory price at original removal. The revenue authorities' valuation was therefore consistent with the statutory scheme, and the challenge to the duty demand failed.

---

---

Issues: Whether the assessable value of the goods was to be determined on the basis of the normal price prevailing at the time of original removal from the factory or on the later sale price realised after deterioration during storage.

Analysis: Duty on excisable goods is a levy on production, and where valuation is ad valorem, Section 4 requires adoption of the normal price at which such goods are ordinarily sold at the time and place of removal. The relevant price was therefore the ex-factory price prevailing when the goods were originally removed for export. Subsequent deterioration of the goods and the reduced price obtained on domestic sale later did not affect the assessable value or the duty liability. The valuation adopted by the lower authorities accordingly conformed to the statutory scheme.

Conclusion: The assessable value was correctly fixed with reference to the price prevailing at the time of removal, and the challenge to the duty demand failed.

Final Conclusion: The appeal was rejected as the valuation adopted by the revenue authorities was held to be in accordance with Section 4 of the Central Excise Act, 1944.

Ratio Decidendi: For excisable goods, assessable value under Section 4 is determined by the normal price at the time of removal, and later deterioration or depreciation in value is irrelevant to valuation.

---