Excise valuation must exclude post-manufacturing costs when billing price includes freight, insurance and selling expenses.

Excise valuation under Section 4 of the Central Excises and Salt Act, 1944 is based on the wholesale cash price at the factory gate or time and place of removal, not automatically on the full depot billing price. The text explains that post-manufacturing elements such as freight, insurance and selling-related expenses are not part of the assessable value and must be deducted where included in the billing price. It also notes that the wholesale cash price can be ascertained even without an actual physical market at the place of manufacture. The practical effect is that assessable value must exclude non-manufacturing costs and selling profits.

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Issues: Whether ad valorem excise duty under Section 4 of the Central Excises and Salt Act, 1944 had to be computed on the billing price charged to depot purchasers, or whether it had to be confined to the manufacturing cost plus manufacturing profit after excluding post-manufacturing expenses such as freight, insurance and selling promotion costs.

Analysis: Section 3 is the charging provision, while Section 4 requires the ascertainment of the wholesale cash price at the time and place of removal from the factory or other place of production. The wholesale cash price is not confined to an actual physical market and may be ascertained even where goods are capable of being sold at the place of manufacture. On the facts, the billing price included elements beyond manufacturing cost and manufacturing profit, including freight, insurance and selling-related expenses. The price therefore could not automatically be treated as the assessable value under Section 4. The correct approach was to start from the billing price and deduct those post-manufacturing elements that were not legitimately part of the wholesale cash price at the factory gate.

Conclusion: The billing price was not the assessable value in full, and the duty had to be worked out by excluding post-manufacturing and selling expenses from that price. The appeals failed.

Ratio Decidendi: For excise valuation under Section 4, the assessable value is the wholesale cash price at the factory gate, excluding post-manufacturing costs and selling profits, and not the entire depot billing price if it includes such excluded elements.

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