Assessable value and pre-deposit issues: notional interest, short-lifting compensation and land cost additions were not prima facie sustained.

At the pre-deposit stage, inclusion of notional interest on customer advances, compensation for short lifting, and notional interest on the cost of land in the assessable value was not prima facie justified. The record showed no material that the customer advance had depressed the price of the gases, and the price remained unchanged after the advance was exhausted. Compensation for failure to lift the contracted quantity was treated as separate from the price of the excisable goods, while the alleged benefit from rent-free use of land was considered too small to warrant the demanded deposit. Duty and penalty were waived for pre-deposit and recovery was stayed.

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Issues: Whether the duty demand could, at the pre-deposit stage, be sustained by including notional interest on customer advances, compensation for short lifting, and notional interest on the cost of land in the assessable value of the excisable goods, and whether waiver of deposit and stay of recovery were warranted.

Analysis: There was no material showing that the customer advance had depressed the price of the gases, and the price remained unchanged even after the advance was exhausted. Compensation for not lifting contracted quantity was treated as distinct from the price of the excisable goods. The alleged benefit arising from rent-free use of land was considered too small and, prima facie, insufficient to justify the demanded deposit, especially when the agreement had already been produced before the departmental officer.

Outcome: The duty and penalty were waived for the purpose of pre-deposit, and recovery was stayed.

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