Depot transaction value governs excise assessment where goods are sold from depots to independent buyers; demand and penalty stayed.

Goods transferred from depots to dealers or consignment agents were to be assessed on the normal transaction value at the depot, because the assessee also sold goods from those depots to independent buyers. The assessable value therefore could not be based on the subsequent disposal of goods at dealers' or agents' premises. Relying on the Board circular, the demand and penalty were treated as not prima facie sustainable, and recovery was stayed pending disposal of the appeal.

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Issues: Whether the duty demand and penalty were prima facie sustainable where the assessee transferred goods from its depots to dealers or consignment agents and sold goods from the depots to independent buyers.

Analysis: The assessable value for goods transferred to a depot was to be determined by the normal transaction value at that depot. As the assessee was making sales from the depots to independent buyers, the goods transferred to that depot were to be assessed on the depot sale price and not on the basis of subsequent disposal at the dealers' or agents' premises. The Board circular supporting this position was relied upon, and on that basis the demand and penalty were viewed as not prima facie sustainable.

Conclusion: The stay application was allowed and recovery was stayed until disposal of the appeal.

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