Site erection charges excluded from excise assessable value where machines were first assembled in the factory and re-erected after transport.

Charges for erection and installation of machines at the customer's site were not part of the assessable value for central excise because the goods came into existence when first assembled and erected in the factory, and were then dismantled for transport in knocked-down condition. Re-erection at the buyer's premises merely restored the machines after transit and did not form part of the value at which the goods were cleared from the factory. On that basis, site erection charges were excluded from valuation, and the demand for differential duty was unsustainable.

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Issues: Whether charges collected for erection and installation of machines at the customer's site were includible in the assessable value of the goods for central excise purposes.

Analysis: The machines were first assembled and erected in the factory, where the excisable goods came into existence, and only thereafter dismantled for transport in knocked-down condition to the customer's premises. Re-erection at site was undertaken merely to restore the machines after transport. On these facts, the site erection charges were not part of the value at which the goods were cleared from the factory.

Conclusion: Site erection charges were not includible in the assessable value. The demand of differential duty on that basis was unsustainable.

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