Sales tax remission under an incentive scheme is excluded from excise valuation because it remains tax actually payable, not extra consideration.

Sales tax remitted under the Gujarat incentive scheme was held not includible in the assessable value of excisable goods because the valuation of central excise is based on transaction value and excludes sales tax actually paid or actually payable. The Tribunal treated remission as distinct from exemption: tax remained payable at removal and was later remitted by the State authority, so it did not become additional consideration from buyer to seller. Following its earlier ruling on an identical scheme, the Tribunal found the duty demand unsustainable.

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Issues: Whether sales tax remitted under the Gujarat incentive scheme was includible in the assessable value of excisable goods for levy of central excise duty.

Analysis: The amount in question arose from a remission scheme under the Gujarat Value Added Tax regime and was granted by the competent authority as part of a capital incentive for industrial investment. The price relevant for central excise valuation is the transaction value, and the statutory exclusion covers sales tax and other taxes if actually paid or actually payable. Remission was distinguished from exemption: in a remission scheme, tax is initially payable and is later remitted by the State authority, so the amount does not become an additional consideration from the buyer to the seller. The Tribunal also followed its earlier decision on an identical scheme, which had taken the same view.

Conclusion: The sales tax remission was not includible in the assessable value, and the demand of duty could not survive.

Ratio Decidendi: Tax remitted under a statutory incentive scheme, where it was otherwise payable at the time of removal, is excluded from central excise valuation as sales tax actually payable and does not constitute additional consideration.

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