Excise valuation and extended limitation turn on actual tax payable and disclosure of Central Sales Tax collections.

Central Sales Tax collected but not actually remitted was treated as part of the excise assessable value, because deduction is available only for taxes actually payable or legally deductible. The analysis applied the principle in Modipon Fibre Company and noted that the Board circular relied on did not specifically cover Central Sales Tax. It also stated that non-disclosure of such CST collection in returns or otherwise supported invocation of the extended limitation period. The discussion therefore links valuation relief to actual tax liability and disclosure of material facts to the department.

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Issues: (i) Whether Central Sales Tax collected but not actually paid could be excluded from the assessable value for excise duty purposes; (ii) Whether the extended period of limitation was invocable on account of non-disclosure of the collection of Central Sales Tax.

Issue (i): Whether Central Sales Tax collected but not actually paid could be excluded from the assessable value for excise duty purposes

Analysis: The assessable value under the excise law is governed by the amount actually payable, and deductions are permissible only for taxes that are actually paid or legally deductible in law. The Board circular relied upon by the assessee did not specifically cover Central Sales Tax, and the principle stated by the Supreme Court in Modipon Fibre Company was applied to hold that the relevant test is the actual tax payable. Since the Central Sales Tax amount was collected but not paid, it could not be excluded from the assessable value on the basis claimed by the assessee.

Conclusion: The claim for deduction of Central Sales Tax from the assessable value was rejected and the finding was against the assessee.

Issue (ii): Whether the extended period of limitation was invocable on account of non-disclosure of the collection of Central Sales Tax

Analysis: The assessee did not intimate the department in the prescribed returns or otherwise that it was collecting Central Sales Tax from buyers without remitting it. In the absence of disclosure of the relevant facts, the plea against invocation of the extended period could not be sustained.

Conclusion: The extended period of limitation was held to be invocable, against the assessee.

Final Conclusion: The appeal failed in full, and the orders below were sustained on both valuation and limitation.

Ratio Decidendi: For exclusion from assessable value, a tax must be actually payable and the relevant facts must be disclosed to the department; otherwise, deduction is not allowable and the extended period may be invoked.

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