Assessable value excludes separately traded bought-out items supplied with a lattice mast for site installation.

Bought-out items supplied with a manufactured lattice mast were held not includible in the assessable value for central excise duty because they were purchased separately as trading goods, were not used in manufacture, and did not form part of the excisable product. Their use was only for erection, installation, or functioning at site, and optional supply at the customer's choice did not amount to additional consideration for the manufactured goods. The demand was therefore unsustainable.

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Issues: Whether the value of bought-out items supplied along with manufactured lattice mast was includible in the assessable value of the manufactured goods for central excise duty.

Analysis: The bought-out items were purchased separately and sold as trading goods. They were not used in the manufacture of the lattice mast, nor were they parts or accessories of the mast itself. The manufacture of the lattice mast was complete independently of those items, and their use was only for erection, installation, or functioning of the high mast tower at site. The value of optional bought-out items supplied at the customer's choice could not, therefore, be treated as additional consideration for the manufactured goods. The principle applied was that goods not manufactured by the assessee and not forming part of the excisable product cannot be added to its assessable value merely because they are supplied along with it.

Conclusion: The value of bought-out items was not includible in the assessable value of the lattice mast, and the demand was unsustainable.

Ratio Decidendi: Goods bought and sold separately as trading items, which are neither used in manufacture nor form part of the excisable product, cannot be added to the assessable value of the manufactured goods merely because they are supplied together for installation or use at site.

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