Excise valuation excludes post-clearance bullet proofing cost where jeeps were cleared from the factory without that processing.

For excise valuation, the cost of bullet proofing carried out after factory clearance of jeeps was not includible in transaction value because the goods were removed from the factory without that processing and the value addition arose only from post-clearance work performed outside the factory premises by job workers. The assessable value therefore could not be increased by the bullet proofing cost, and the appeal failed.

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Issues: Whether the cost of bullet proofing carried out after clearance of jeeps from the factory could be added to the transaction value for the purpose of excise duty.

Analysis: The jeeps were cleared from the factory without bullet proofing and were sent outside the factory premises for bullet proofing by job workers only after clearance. Since the value addition arose from post-clearance processing and not from the condition of the goods at the time of factory clearance, the cost of bullet proofing did not form part of the transaction value.

Conclusion: The cost of bullet proofing could not be included in the assessable value, and the appeal failed.

Ratio Decidendi: For excise valuation, post-clearance processing undertaken outside the factory premises is not includible in transaction value when the goods are cleared from the factory without such processing.

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