Marketing expenses excluded from captive consumption valuation where they lacked nexus with manufacture under the valuation rules.

Marketing expenses were held not includible in the assessable value of goods cleared for captive consumption on cost construction basis because such expenses have no nexus with manufacture under the applicable valuation rules. The Tribunal followed its earlier orders in the assessee's own case and reaffirmed the settled position that only manufacturing-related costs form part of the assessable value. On that basis, the assessee's valuation method was found to be in line with the law, and the Revenue's challenge failed.

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Issues: Whether marketing expenses were includible in the assessable value of goods cleared for captive consumption on cost construction basis under the valuation rules.

Analysis: The Tribunal followed its earlier orders in the assessee's own case and reiterated that, for valuation of captively consumed goods, marketing expenses have no nexus with manufacture and therefore cannot form part of the assessable value. The assessee's valuation was thus in line with the settled position under the applicable valuation rules.

Conclusion: Marketing expenses were not includible in the assessable value. The Revenue's challenge had no substance and the appeal was dismissed in favour of the assessee.

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