Freight Exclusion from Assessable Value upheld where Revenue failed to prove any flow back to the manufacturer.

Freight incurred for removal of goods from the factory gate to the consignment agent was held not includible in assessable value where Revenue failed to prove any flow back of the freight amount to the manufacturer. The Tribunal applied its earlier view in the assessee's own case and found no evidence that the freight paid by the buyer to the transporter reached the manufacturer in disguised form. On that basis, the declared assessable value could not be disturbed, and the associated duty demand and penalty were unsustainable.

---

---

Issues: Whether the freight incurred for removal of goods from the factory gate to the consignment agent was includible in the assessable value and whether the consequent duty demand and penalty were sustainable.

Analysis: The dispute was covered by the Tribunal's earlier decision in the assessee's own case on the same valuation question. It was found that the Revenue had not established that the freight paid by the buyer to the transporter had any flow back to the manufacturer. In the absence of proof that the freight element reached the manufacturer in disguise, the declared assessable value could not be disturbed.

Conclusion: The freight component was not includible in the assessable value, and the duty demand and penalty were not sustainable. The appeals were allowed.

Ratio Decidendi: Freight paid for transportation is not includible in assessable value unless Revenue proves that the amount flowed back to, or benefited, the manufacturer.

---