Assessable value must track factory clearance, while erection and commissioning charges for immovable property are excluded from valuation.

Excisability and assessable value must be determined with reference to the goods as removed from the factory, not the articles erected at site as immovable property. The Tribunal noted that later Supreme Court rulings on factory clearance, independent excisable goods, and the treatment of erection and commissioning charges had not been properly considered. It further indicated that component parts and accessories supplied for site erection required fresh factual examination to determine whether they formed part of the assessable value. The matter was remanded for de novo consideration, with reconsideration of duty, limitation and Modvat issues.

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Issues: Whether the duty demand and penalty required reconsideration in the light of the Supreme Court decisions on excisability of goods at the stage of removal from the factory, inclusion of erection and commissioning charges, and whether the matter should be remanded for de novo adjudication.

Analysis: The Tribunal found that the earlier disposal of the dispute had not examined the later Supreme Court rulings on the distinction between goods manufactured and removed from the factory and the articles erected at site as immovable property. It also noted that the question whether the spindle frames cleared from the factory were independent excisable goods, and whether the component parts and accessories supplied for erection at site could be treated as part of the assessable value, had not been properly appreciated. In view of the controlling legal position that valuation must be determined on the basis of the goods as they leave the factory and that erection and commissioning charges for what becomes immovable property are not includible, fresh examination of the facts and evidence was necessary.

Conclusion: The matter was remanded for de novo consideration, with opportunity to the assessee and reconsideration of duty, limitation and Modvat issues as required.

Ratio Decidendi: Excisability and assessable value must be determined with reference to the goods as removed from the factory, and charges attributable to erection or commissioning of immovable property are not includible in the assessable value.

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