Notional interest on buyer deposits excluded from assessable value absent proof of nexus with manufacture or clearance.

Notional interest on deposits collected from prospective buyers and dealers was held not includible in the assessable value unless the department proved a nexus between the interest element and the manufacturing or clearance activity. The record showed no evidence linking the deposits to the value of the goods, so the burden of establishing includibility was not discharged. On that basis, the valuation claim failed and the notional interest could not be added to assessable value.

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Issues: Whether notional interest on deposits collected from prospective buyers and dealers was required to be included in the assessable value of the goods.

Analysis: The issue was treated as settled by the binding law on valuation, under which notional interest can be added only where the department establishes a nexus between the interest element and the manufacturing or clearance activity. The record disclosed no evidence of such nexus. In the absence of proof linking the deposits to the assessable value, the department failed to discharge its burden.

Conclusion: Notional interest on the deposits was not includible in the assessable value, and the appeal succeeded.

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