Excise valuation excludes post-clearance installation and commissioning charges when the product is complete before clearance.

Where an excisable product comes into existence in the factory before clearance, assessable value is confined to the factory price and the manufacturing expenses incurred up to that stage. Charges incurred after clearance for transport, re-erection, installation and commissioning at the customer's premises are post-manufacture and post-clearance expenses, so they are not includible in assessable value. On that basis, the site-related charges for weighbridge installation and commissioning were held outside the excise valuation base, and the departmental challenge failed.

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Issues: Whether the charges for installation, re-erection and commissioning of weighbridges at the customer's premises were includible in the assessable value when the finished product had come into existence in the factory before clearance.

Analysis: The product was manufactured and came into existence in the factory itself, though it was cleared in knocked-down condition for ease of transport and was later re-erected at the customer's site. The value for excise purposes had therefore to be determined on the basis of the factory price, which would already reflect the manufacturing expenses incurred up to the stage of clearance. Charges incurred after clearance for transport, erection and commissioning at the buyer's premises were treated as post-manufacture and post-clearance expenses and were not part of the assessable value.

Conclusion: The installation and commissioning charges were not includible in the assessable value, and the assessee succeeded on this issue.

Final Conclusion: The departmental appeals failed because the disputed site-related charges were held to be outside the assessable value of the excisable goods.

Ratio Decidendi: Where a finished excisable product is manufactured and comes into existence in the factory before clearance, expenses incurred after clearance for transport, re-erection and commissioning at the customer's premises are post-manufacture costs and cannot form part of assessable value.

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