Packing material value in excise assessment depends on whether wooden containers are durable and returnable.

The value of packing material forms part of the assessable value for excise duty unless the packing containers are proved to be durable and returnable. Applying that principle, the Court held that the earlier view excluding wooden containers could not stand without evidence on their character, and the matter required fresh examination on that limited factual issue. The appeals succeeded and the case was remitted to the High Court to determine whether the wooden containers were durable and returnable and whether their value was deductible.

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Issues: Whether the value of wooden containers used for packing glass products could be excluded from the assessable value for excise duty under Item 23-A, and whether the containers were durable and returnable so as to permit such deduction.

Analysis: The prior view that the value of wooden containers could not form part of the value of the glass products could not be sustained in the light of the later decision governing inclusion of packing material value, unless the containers were shown to be durable and returnable. The authorities had negatived that contention, but the High Court had not examined it because it proceeded on the law as then understood. The question therefore required fresh examination on the evidence to determine whether deduction of the value of the wooden containers was permissible.

Conclusion: The matter was remitted to the High Court to decide whether the containers were durable and returnable and whether the assessee was entitled to deduction of their value.

Final Conclusion: The appeals succeeded and the case was sent back for reconsideration on the limited factual issue concerning the nature of the wooden containers.

Ratio Decidendi: The value of packing material forms part of the assessable value unless the packing containers are established to be durable and returnable.

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