Shared advertisement reimbursements were held outside assessable value for central excise duty under a common marketing arrangement.

Shared advertisement expense reimbursements received under an agreed formula between co-manufacturers of the same soft drinks were not consideration attributable to the assessee's clearances. The reimbursement was treated as a common marketing arrangement benefiting both manufacturers, not as payment for the goods manufactured by the assessee. On that basis, the amount was held not includible in assessable value for central excise duty, and the issue was decided in favour of the assessee.

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Issues: Whether the amount reimbursed by a co-manufacturer towards shared advertisement expenses could be treated as consideration attributable to the assessee's clearances and subjected to central excise duty.

Analysis: The manufacturers produced the same soft drinks and both derived benefit from the common advertisements. The reimbursement represented a shared advertisement arrangement under an agreed formula and was not the assessee's receipt for the goods manufactured by it. In these circumstances, the other party's contribution towards advertisement expenses could not be treated as if the assessee alone had borne the cost for its own manufacturing activity.

Conclusion: The reimbursed advertisement amount was not includible in the assessable value for central excise duty and the issue was decided in favour of the assessee.

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