Packing charges in excise valuation depend on when the depot becomes the place of removal, with pre-date exclusions upheld.

Packing charges were excluded from assessable value for clearances made before 13-5-2003 because the depot was treated as a place of removal only from that date, so the relevant transaction value was the depot selling price on the date of removal. For the period after 13-5-2003, once the depot became a place of removal, no error was found in applying Section 4(1)(a) of the Central Excise Act, 1944 and including packing cost in the transaction value. The limitation objection was not entertained because it had not been raised in the appeals. The rectification application was therefore allowed only partly.

---

---

Issues: Whether the depot could be treated as a place of removal only from 13-5-2003 for the purpose of valuation and inclusion of packing charges in the assessable value, and whether any apparent error existed in applying Section 4(1)(a) of the Central Excise Act, 1944 for the subsequent period.

Analysis: The depot was recognized as a place of removal only with effect from 13-5-2003. For the period prior to that date, the goods were cleared from the factory for sale in the depot, and packing charges were not required to be included in the assessable value. The transaction value for that period was the selling price at the depot on the date of removal. For the period after 13-5-2003, once the depot became a place of removal, no error could be found in adopting the transaction value including packing cost under Section 4(1)(a). The plea on limitation did not survive because it had not been raised in the appeals.

Conclusion: The rectification application succeeded only to the extent that packing charges were excluded for the period prior to 13-5-2003. The rest of the order was left undisturbed, and the applications were allowed in part.

---