Notional excise duty shown on invoices was not deductible from assessable value under valuation rules.

During the exemption period under Notification No. 33/71, the sale price was treated as inclusive of the duty element shown on invoices, but that amount was regarded as notional rather than an actual deductible component. Section 4 of the Central Excises and Salt Act did not allow exclusion of such notional duty from assessable value, and the earlier review order on the same issue supported that position. The duty element separately charged but retained by the assessee was therefore not deductible, and the Department's valuation computation was upheld.

---

---

Issues: Whether, while computing the value of clearances made during the exemption period under Notification No. 33/71, the duty element separately charged on invoices but retained by the assessee was liable to be excluded from the assessable value under Section 4 of the Central Excises and Salt Act.

Analysis: The actual sale price during the exemption period was inclusive of the amount shown as Central Excise duty, and the duty element so shown was treated as notional rather than actual. Section 4 of the Central Excises and Salt Act did not permit deduction of any notional amount for valuation purposes. The earlier review order on an identical issue was also relied upon to hold that such notional deduction was not warranted in law.

Conclusion: The duty element was not deductible from the assessable value and the computation made by the Department was upheld.

---