Excise valuation based on buyer's price set aside where the authority ignored the agreement and surrounding circumstances.

An excise valuation order under section 4 treating the buyer's price as the assessable value was found unsustainable because it was passed without considering the agreement between the parties and the surrounding circumstances. The Court held that the existence of an appellate remedy did not justify of relief where the impugned order was cryptic and had ignored material facts relevant to valuation. The order was set aside and the matter was remanded to the Assistant Collector for fresh decision after hearing the petitioners and considering all relevant circumstances, including the agreement.

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Issues: Whether the excise valuation order under section 4 of the Central Excises and Salt Act, 1944, which treated the buyer's price as the assessable value, could be sustained when it was passed without considering the agreement and surrounding circumstances, and whether the writ petition should be entertained despite the availability of an appeal.

Analysis: The order under challenge was found to be cryptic and to have ignored the relevant circumstances bearing on the relationship between the parties and the terms of the agreement. The availability of an appellate remedy did not persuade the Court to refuse relief, because the matter required proper consideration on the basis of all relevant facts and the agreement between the parties. The Court therefore directed that the issue be reconsidered afresh by the Assistant Collector after giving the petitioners an opportunity of being heard.

Conclusion: The impugned order was set aside and the matter was remanded for fresh decision after considering all relevant circumstances, including the agreement between the parties; the petitioners succeeded.

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