Assessable value for excisable goods may be based on arm's-length wholesale prices, making related-person inquiry unnecessary.

Where excisable goods are sold partly to independent wholesale buyers at arm's length, the assessable value may be determined by reference to those independent sale prices. On that basis, the enquiry whether appointed distributors are related persons becomes unnecessary if the arm's-length wholesale price is otherwise applicable. The stated result is that the assessable value must be redetermined using the prices charged to independent wholesale buyers, and the related-person issue is treated as irrelevant for that exercise.

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Issues: Whether the assessable value of the excisable goods was to be determined on the basis of the prices charged to independent wholesale buyers, and whether it was necessary to examine the distributors as related persons.

Analysis: The bulk of the sales during the relevant period was made to appointed distributors, while a smaller portion was sold to independent wholesale buyers at arm's length. The price charged to such independent buyers was treated as the proper basis for arriving at assessable value. On that approach, the question whether the distributors were related persons was held to be unnecessary for decision.

Conclusion: The assessable value was required to be redetermined on the basis of the prices charged to independent wholesale buyers, and the related-person issue was held irrelevant.

Final Conclusion: The order-in-appeal was set aside and the matter was concluded in favour of reassessment on the basis of independent wholesale sale prices.

Ratio Decidendi: Where excisable goods are sold partly to independent buyers at arm's length, the assessable value may be determined by reference to those independent sale prices, rendering the related-person enquiry unnecessary if that basis is otherwise applicable.

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