Excise valuation of bulk-packed paints depends on condition at removal, not later retail-pack price after repacking.

Paints and enamels cleared from the factory in bulk packing were valued for excise duty by reference to their condition at the time and place of removal under Section 4 of the Central Excises and Salt Act, 1944. Repacking after clearance into smaller retail containers did not create a new commercial commodity, so the later retail-pack price could not be adopted for the bulk clearances. The duty assessment therefore remained confined to the bulk-packed goods as removed from the factory, and the higher resale value after repacking was irrelevant to valuation on the original clearance.

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Issues: Whether paints and enamels cleared in bulk packing on payment of duty were chargeable on the price at which they were subsequently sold after repacking into smaller retail packs.

Analysis: The goods had already been cleared from the factory in bulk packing on payment of duty. For valuation under Section 4 of the Central Excises and Salt Act, 1944, duty is to be assessed with reference to the condition of the goods at the time and place of removal. Repacking after clearance did not create a new commercial commodity, and the goods remained the same excisable products despite being put into smaller containers. Accordingly, the higher retail-pack price could not be adopted for duty on the bulk clearances.

Conclusion: The bulk-cleared paints and enamels were not chargeable to duty on the price realised after repacking into smaller packs, and the assessee succeeded on this issue.

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