Assessable value for excise excludes packing cost and freight; refund suit lies where duty was levied without authority.

Assessable value under Section 4 of the Central Excises and Salt Act, 1944 is confined to the wholesale cash price at the factory gate and does not include post-manufacturing elements unless the statute expressly so provides. On that principle, the cost of tin containers and freight could not be added to the value of vanaspati for excise duty, as packaging was not treated as part of manufacture under the Act then in force. A civil suit for refund of duty was also maintainable because Sections 35, 36 and 40 did not bar recovery of duty levied wholly without authority of law, and civil court jurisdiction is not excluded by implication.

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Issues: (i) Whether the cost of tin containers and freight could be included in the assessable value of vanaspati for levy of excise duty under Section 4 of the Central Excises and Salt Act, 1944. (ii) Whether the civil suit for refund of duty was barred by Sections 35, 36 and 40 of the Central Excises and Salt Act, 1944.

Issue (i): Whether the cost of tin containers and freight could be included in the assessable value of vanaspati for levy of excise duty under Section 4 of the Central Excises and Salt Act, 1944.

Analysis: The excise levy was chargeable only on the excisable goods, namely hydrogenated vegetable oil, and not on the tin containers in which it was packed. The Court applied the principle that the assessable value under Section 4 is confined to the wholesale cash price at the factory gate and excludes post-manufacturing expenses and charges not forming part of the manufactured product. The Act, as it then stood, did not treat packaging of vanaspati as an integral part of manufacture, unlike provisions expressly made for other goods. Freight was also held to be a post-manufacturing expense and not part of the value of the excisable goods.

Conclusion: The inclusion of the cost of tin containers and freight in the assessable value was not permissible and the finding was in favour of the assessee.

Issue (ii): Whether the civil suit for refund of duty was barred by Sections 35, 36 and 40 of the Central Excises and Salt Act, 1944.

Analysis: The appellate remedy and revisional remedy under Sections 35 and 36 did not govern a suit for recovery of duty collected without authority of law. Section 40, properly construed, protected acts done in good faith and did not bar a suit for refund of illegally levied duty. The Court also applied the principle that exclusion of civil court jurisdiction is not readily inferred, and where the levy itself is wholly outside the statute, a civil suit for refund remains maintainable.

Conclusion: The civil suit was maintainable and the plea of bar of jurisdiction failed, in favour of the assessee.

Final Conclusion: The decree for refund was upheld and the appeal by the Union of India failed in its entirety.

Ratio Decidendi: In the absence of an express statutory inclusion, assessable value for excise excludes post-manufacturing elements such as packing cost and freight, and a suit for refund lies where duty has been levied wholly without authority of law notwithstanding a general bar provision protecting acts done in good faith.

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