Excise valuation under Section 4(1) follows when exemption fails, but unresolved pricing and limitation issues can justify remand.

Where Notification No. 120/75 was inapplicable, excise duty had to be assessed on the assessable value under Section 4(1) of the Central Excise Act, 1944. The assessee accepted that it was not entitled to the notification benefit, but the disputes on different factory gate prices, transport-related deductions, and limitation required factual examination not undertaken by the adjudicating authority. The impugned orders were therefore set aside and the matter was remitted for fresh adjudication, with evidence and hearing to be allowed on the unresolved valuation and limitation issues.

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Issues: Whether the assessee was entitled to the benefit of Notification No. 120/75 and, consequently, whether duty had to be assessed on the value determined under Section 4(1) of the Central Excise Act, 1944.

Analysis: The assessee did not dispute that, on the facts, it was not entitled to the benefit of Notification No. 120/75. In such a situation, duty was required to be paid on the assessable value under Section 4(1) of the Central Excise Act, 1944. The dispute regarding the existence of different factory gate prices for different classes of buyers, the treatment of transport-related deductions, and the limitation plea required factual examination that had not been undertaken by the adjudicating authority.

Conclusion: The assessee was not entitled to the notification benefit, and assessment had to proceed under Section 4(1) of the Central Excise Act, 1944; however, the matter required fresh adjudication on the additional factual and limitation issues.

Final Conclusion: The impugned orders were set aside and the matter was remitted to the jurisdictional adjudicating authority for fresh decision after allowing evidence and hearing.

Ratio Decidendi: Once the exemption notification is inapplicable, excise duty must be determined on the assessable value under Section 4(1), but unresolved factual questions affecting valuation and limitation may justify remand for de novo consideration.

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