Assessable value excludes optional post-clearance transformer placement and handling charges when not part of the sale price.

Outward handling charges and separately collected charges for placing transformers on the plinth were not includible in the assessable value where the sale contract treated them as optional extras payable only when applicable. Because the placement activity was undertaken after clearance at the buyer's request and was not a condition precedent to sale, it did not form part of the manufactured goods' assessable value under Section 4(1)(a) of the Central Excise Act, 1944. The resulting demand and penalty were not sustainable.

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Issues: Whether outward handling charges and charges for placement of transformers on the plinth, collected separately and undertaken optionally after clearance, are includible in the assessable value under Section 4(1)(a) of the Central Excise Act, 1944.

Analysis: The sale contract specifically showed extra charges for placement of the transformer on the plinth as payable only whenever applicable. The charges were not a condition precedent to sale, and the installation activity was undertaken after clearance at the buyer's request. Optional post-clearance charges of this nature do not form part of the assessable value of the manufactured goods.

Conclusion: The charges were not includible in the assessable value, and the demand and penalty were not sustainable.

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