FOR destination contracts include freight and insurance in assessable value when sale concludes at buyer's premises.

In FOR destination contracts, the assessable value for central excise includes freight, insurance and allied charges incurred up to delivery where the contractual terms show that ownership and sale conclude only on receipt of goods at the buyer's premises. The place of removal is determined by the actual point at which the sale is completed, not by an ex-works assumption. On the stated facts, the buyer's premises were correctly treated as the place of removal, so destination-based charges formed part of the assessable value.

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Issues: Whether freight, insurance and allied charges collected from customers under FOR destination contracts were includible in the assessable value for central excise duty by treating the buyer's premises as the place of removal.

Analysis: The contracts and purchase orders showed that delivery was to be completed only on receipt of goods at the customer's stores in good condition, with ownership remaining with the appellant until such delivery. On that factual matrix, the sale was not ex-works but concluded at the destination. For FOR basis clearances, the place of removal has to be determined from the contractual terms and actual point of sale, and where the sale is completed at the buyer's premises, transportation and insurance charges incurred up to that point form part of the assessable value. The earlier view treating the issue under ex-works conditions was found inapplicable on the present facts.

Conclusion: Freight, insurance and related destination-based charges were rightly included in the assessable value, and the finding that the buyer's premises constituted the place of removal was upheld.

Ratio Decidendi: In FOR destination contracts, where ownership and sale conclude only upon delivery at the buyer's premises, expenses incurred up to delivery, including freight and insurance, are includible in the assessable value under central excise valuation.

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