Deductibility of additional sales tax from excise assessable value upheld where statutory collection from buyers was barred.

Additional sales tax payable under the Tamil Nadu General Sales Tax Act was deductible from the sale price for central excise valuation because the approved price lists showed the assessee bore that liability on local sales and the buyers were not charged the tax due to a statutory bar on collection. The tax therefore formed part of the price realised and had to be excluded from the assessable value. The refund granted on that basis was in accordance with law and was upheld in favour of the assessee.

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Issues: Whether additional sales tax payable under the Tamil Nadu General Sales Tax Act was deductible from the sale price while determining the assessable value for central excise purposes, and whether the refund granted on that basis was justified.

Analysis: The approved price lists showed that the appellant was to bear additional sales tax in respect of local sales. The buyers had not been charged such tax because collection was statutorily barred. In these circumstances, the tax formed part of the price realised and had to be deducted from the sale price to arrive at the assessable value. The earlier grant of refund was therefore in accordance with law.

Conclusion: The deduction of additional sales tax was permissible and the refund was rightly granted in favour of the assessee.

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