Normal factory-gate price and quantity discount were accepted for tile valuation under Section 4, defeating Revenue's challenge.

Normal factory-gate wholesale price was treated as the assessable value for ceramic glazed tiles under Section 4, because a small proportion of higher-priced sales to other buyers did not make the normal price unascertainable or require a different valuation method. Quantity discount was also deductible where the discount scheme was known at clearance, and the fact that some discount was granted after clearance did not defeat deduction when the scheme had been established and the discount was actually passed on. The valuation adopted by the appellate authority was therefore upheld, and the Revenue's challenge failed.

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Issues: (i) whether the normal factory-gate sale price could be taken as the assessable value for ceramic glazed tiles under Section 4, despite a small percentage of sales to other buyers at higher prices; and (ii) whether quantity discount, including discount granted after clearance and the manner in which the discount scheme operated across varieties of tiles, was deductible from the assessable value.

Issue (i): whether the normal factory-gate sale price could be taken as the assessable value for ceramic glazed tiles under Section 4, despite a small percentage of sales to other buyers at higher prices.

Analysis: The appellate authority's view was founded on the settled principle that where normal wholesale factory-gate sales are available, that price constitutes the basis of valuation. A small proportion of sales to other classes of buyers at higher prices does not make the normal price unascertainable or justify resort to the expanded valuation method. The order also drew support from the distinction between normal wholesale sales and isolated sales to other buyer classes.

Conclusion: The normal factory-gate sale price was correctly adopted as the assessable value, and the Revenue's challenge on this issue failed.

Issue (ii): whether quantity discount, including discount granted after clearance and the manner in which the discount scheme operated across varieties of tiles, was deductible from the assessable value.

Analysis: Quantity discount was held to be deductible when the scheme was known at the time of clearance, and the Board's circular clarified that duty is chargeable on the net price actually paid or payable. The fact that in some instances the discount was granted after clearance did not, by itself, displace the deduction where the scheme was otherwise established. The Tribunal also accepted that the structuring of the discount offer, including its application where different varieties were purchased, was within the assessee's commercial discretion and could not be faulted by Revenue once the discount was actually passed on.

Conclusion: The quantity discount was allowable as a deduction and the Revenue's objection to the discount scheme was rejected.

Final Conclusion: The valuation adopted by the appellate authority was upheld in full, and the Revenue's appeal was dismissed.

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