Assessable value includes octroi on raw materials used in manufacture; input taxes remain part of finished goods cost.

Octroi paid on raw materials used in manufacturing forms part of the cost of the finished excisable goods and is includible in the assessable value. Section 4(4)(d)(ii) of the Central Excises and Salt Act, 1944 excludes only taxes paid on the goods under assessment, not taxes paid on inputs used to produce them. The Tribunal applied the same valuation principle previously affirmed in earlier adjudication and held that octroi on raw materials cannot be excluded from assessable value.

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Issues: Whether octroi paid on raw materials used in manufacture is includible in the assessable value of the finished excisable goods.

Analysis: The price of finished goods must reflect the full cost of the raw materials used in their manufacture, and tax payable on such raw materials forms part of that cost. Section 4(4)(d)(ii) of the Central Excises and Salt Act, 1944 permits exclusion only of taxes paid on the goods under assessment, not of taxes paid on inputs used in the manufacture of those goods. The Tribunal applied the same principle previously affirmed in earlier adjudication.

Conclusion: Octroi on raw materials is includible in the assessable value of the finished goods, and the appeal fails.

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