Ex-factory price governs excise valuation for depot sales when factory-gate price is ascertainable and predominant.

Where an ascertainable ex-factory price exists and the major part of the goods is sold at the factory gate on approved price lists, that price governs valuation under section 4 of the Central Excises and Salt Act, 1944 even for clearances through depots. The contention that depot sales form a separate class of buyers was rejected, and depot clearances were not treated as a distinct basis for valuation. The stated principle is that valuation follows the available factory-gate price when it can be ascertained.

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Issues: Whether, where the ex-factory price is ascertainable and the major portion of the goods is sold at the factory gate, that price forms the basis for valuation under section 4 of the Central Excises and Salt Act, 1944 even in respect of goods cleared through depots.

Analysis: The major part of the goods was sold at the factory gate on approved price lists. The contention that depot sales constitute a separate class of buyers was not accepted. Reliance was placed on the principle that, when the ex-factory price is ascertainable, valuation must proceed on that basis notwithstanding that some clearances are made through depots.

Conclusion: The ex-factory price is the basis for determining the value of the goods even for depot sales, and the issue is decided in favour of the assessee.

Ratio Decidendi: Where an ascertainable ex-factory price exists, it governs valuation under section 4 of the Central Excises and Salt Act, 1944 even for depot sales.

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