Assessable value excludes vehicle accessories like jack assemblies and tool kits; corresponding Modvat credit remains available.

Jack assemblies and tool kits supplied with motor vehicles were treated as accessories, not components or integral parts of the automobiles, because they were neither statutory requirements for registration or use nor necessary for marketability. On that basis, their value was held not includible in the assessable value under section 4 of the Central Excise Act. The same treatment supported Modvat credit on duty paid on such bought-out items where otherwise admissible.

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Issues: Whether the value of jack assemblies and tool kits supplied with motor vehicles is includible in the assessable value of the automobiles; and whether the manufacturer is entitled to Modvat credit on duty paid on such goods.

Analysis: The determining test under section 4 of the Central Excise Act is whether the items form part of the manufactured product or are merely accessories. The materials on record showed that jack assemblies and tool kits were not statutory requirements for registration or running of the vehicles, were not essential for marketability, and were not components or integral parts of the cars. The reasoning adopted in earlier decisions that similar items were accessories rather than constituent parts of the vehicle was applied. On that basis, the Department could not add their value to the assessable value of the automobiles. Consistently, duty paid on such bought-out items could be taken into account for Modvat credit where otherwise admissible.

Conclusion: The value of jack assemblies and tool kits is not includible in the assessable value of the automobiles, and the assessee is entitled to the corresponding Modvat credit treatment.

Ratio Decidendi: Accessories which are neither components nor integral parts of the manufactured automobile, and which are not necessary for its marketability, are not includible in assessable value under section 4 of the Central Excise Act.

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