Packing cost under excise valuation is not includible when special packing is used only for transport protection.

Packing cost is includible in the assessable value only when excisable goods are removed in a packed condition under Section 4(4)(d)(i) of the Central Excise Act, 1944. Where glass sheets were cleared mainly without packing and the wooden or other special packing was used only to protect goods during transport, that packing did not form part of the normal condition of removal. On that basis, the cost of such transport-related packing was held not includible in assessable value, and the deduction claim was accepted in favour of the assessee.

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Issues: Whether the cost of wooden and other special packing used for transportation of glass sheets was includible in the assessable value under Section 4(4)(d)(i) of the Central Excise Act, 1944.

Analysis: Section 4(4)(d)(i) includes the cost of packing in value only where the goods are delivered at the time of removal in a packed condition. The record showed that more than 64% of the goods were cleared from the factory gate without any packing, and the packing in dispute was for protection during transport rather than a normal condition of removal. On that basis, the cost of such packing did not form part of the assessable value.

Conclusion: The claim for deduction of packing cost was held correct and was allowed in favour of the assessee.

Ratio Decidendi: Packing cost is includible in assessable value only when excisable goods are removed in a packed condition; special packing used merely for safe transport is not includible.

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