Assessable value for excise duty follows the price actually contracted with the buyer who received the goods; excess duty was refundable.

Where goods cleared for one buyer were ultimately delivered to another under a separate contract at a lower price, the assessable value for excise duty followed the contractual price of the buyer who actually received the goods. Because the lower price was the operative sale price and not a post-clearance concession, duty paid on the higher intended price constituted excess duty. Refund claims were therefore properly allowed, and the challenge to that relief failed.

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Issues: Whether excess central excise duty paid on consignments diverted to another buyer at a lower contractual price was refundable on the basis of the price actually realised from the buyer who took delivery.

Analysis: The goods had been cleared for one buyer at a higher contract price, but delivery was ultimately taken by another buyer under a separate contract at a lower price. The lower price was not a negotiated post-clearance reduction caused by market pressure; it was the contractual price applicable to the buyer who actually received the goods. In such a situation, the assessable value for duty purposes followed the price under the contract with the buyer to whom the goods were in fact supplied, and the duty paid on the higher intended price represented excess duty.

Conclusion: The refund claims were rightly allowed, and the challenge to that relief failed.

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