Quantity discounts on pesticide sales were deductible for excise purposes when fixed in advance and reflected in invoices.

Free supplies given with pesticide sales were treated as quantity discounts where they were granted at fixed rates on purchases above a specified quantity and were shown in the invoices at the time of removal. Because the discount was known when the goods were cleared, it was admissible as a deduction for excise duty purposes. The text distinguishes such pre-determined quantity-linked concessions from a mere sales promotion device and treats the free supplies as part of the discount structure rather than taxable value.

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Issues: Whether free supplies given along with sales of pesticides constituted quantity discounts admissible for excise duty purposes.

Analysis: The free supplies were granted at fixed rates on purchases above a specified quantity and were reflected in the invoices at the time of removal. On the facts, they were treated as quantity discounts and not as a mere sales promotion device. Since the discount was known when the goods were removed, it was admissible for deduction.

Conclusion: The free supplies were allowable as quantity discounts and no excise duty was payable on them. The appeal was allowed.

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