Freight charges beyond the factory gate are excluded from assessable value where removal is at the factory gate.

Freight charges separately shown in invoices and recovered from buyers were not includible in the transaction value of excisable goods where, on an identical FOR sales factual matrix, the place of removal was the factory gate. Transportation beyond the factory gate was treated as post-removal activity, so the freight element did not form part of the assessable value for excise duty. The duty demand was therefore unsustainable.

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Issues: Whether freight charges shown separately in the invoices and collected from buyers are includible in the transaction value of excisable goods for the purpose of charging excise duty.

Analysis: On the identical factual matrix of FOR sales, the place of removal was treated as the factory gate. Freight charges separately recovered from customers for transportation beyond the factory gate were therefore not part of the assessable value for levy of excise duty.

Conclusion: The freight charges were not includible in the assessable value, and the demand was unsustainable.

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