Assessable value under excise includes retained exemption relief not actually payable as duty

A manufacturer's 25% excise relief retained under an exemption notification was held to form part of the assessable value. The retrospective amendment to the excise valuation provisions clarified that only the effective duty of excise, after full effect to any exemption, counts as duty payable under the Act. Amounts recovered as duty but not actually payable under the Act cannot be excluded from valuation. As the retained amount was not shown to be any other deductible item, it was included in the assessable value against the assessee.

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Issues: Whether the 25% excise relief retained by the manufacturer under the exemption notification formed part of the assessable value for excise duty purposes.

Analysis: The relief notification was intended to encourage higher production, but the later retrospective amendment to the excise valuation provisions clarified that the duty payable under the Act is only the effective duty of excise after giving full effect to any exemption. Money recovered by the manufacturer as duty, but not actually payable as duty under the Act, cannot be treated as duty for valuation. Since the amount retained by the manufacturer was not shown to be any other deductible item such as sales tax, it had to be included in the assessable value.

Conclusion: The 25% amount retained by the manufacturer was not deductible as duty and was correctly included in the assessable value, against the assessee.

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