Post-clearance cutting charges are excluded from excise assessable value where the goods were already cleared on factory price.

Cutting charges recovered for steel tubes cut at the depot after clearance from the factory were not includible in the assessable value for excise duty. Duty had already been discharged on the factory-clearance price, and the later cutting was done post-clearance to meet dealer requirements. Expenses incurred by a manufacturer after the goods leave the factory are not part of manufacturing cost for excise valuation. The duty demand and penalty therefore could not be sustained.

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Issues: Whether cutting charges recovered for cutting steel tubes at the depot after clearance from the factory were liable to be included in the assessable value for levy of excise duty.

Analysis: Duty had already been paid on the price at which the goods were cleared from the factory, and the subsequent cutting at the depot was carried out after clearance to meet dealer requirements. Expenditure incurred by a manufacturer after clearance of the goods from the factory is not to be added to the value of the goods for assessment under excise law. The post-clearance cutting charges therefore could not be treated as part of the manufacturing expenses for excise valuation.

Conclusion: The cutting charges were not includible in the assessable value and the duty demand and penalty could not be sustained.

Ratio Decidendi: Expenses incurred after clearance of goods from the factory are not includible in the assessable value for excise duty.

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