Assessable value for export-oriented unit goods turns on the place of removal and the true nature of disputed port charges.

For valuation of goods cleared into India by a 100% export-oriented unit, the applicable customs-based scheme requires identification of the legally relevant time and place of removal, because only expenses incurred up to that point can enter assessable value. The record did not clearly establish whether removal occurred before the port premises, within the port premises, or at loading into the ship, so the matter had to be re-examined. The amount described as port charges also required factual segregation, as its components included items beyond loading and handling; only the part, if any, relating to pre-removal loading or handling could be included, and the dispute was remanded for fresh determination.

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Issues: (i) Whether the time and place of removal of goods manufactured by a 100% export-oriented unit had been established for the purpose of valuation. (ii) Whether the amount described as port charges of Rs. 18 per M.T. was wholly includible in the assessable value or required factual segregation.

Issue (i): Whether the time and place of removal of goods manufactured by a 100% export-oriented unit had been established for the purpose of valuation.

Analysis: For valuation of goods produced by a 100% export-oriented unit and sold in India, the applicable statutory scheme required adoption of customs-based valuation principles. The relevant inquiry was the point at which the goods were removed and could be treated as deliverable, because all costs up to the place of removal could enter the valuation base. On the record, there was no clear finding as to whether removal occurred before the port premises, within the port premises, or at the stage of loading into the ship.

Conclusion: The issue was not finally determined on merits and was required to be re-examined by the appellate authority.

Issue (ii): Whether the amount described as port charges of Rs. 18 per M.T. was wholly includible in the assessable value or required factual segregation.

Analysis: The record showed competing descriptions of the amount, including engineering expenses, port dredging expenses, port management and secretarial expenses, and medical and welfare expenses, while the authorities below treated it as loading and handling charges. The nature of the charge had not been conclusively established. Only such component, if any, as related to loading or handling up to the relevant point of removal could be added to value, whereas charges of a post-removal character would not be includible.

Conclusion: The issue was remanded for determination of the true nature and component breakup of the amount.

Final Conclusion: The valuation dispute was sent back for fresh determination on the place and time of removal and on the includibility of the port-charge component, so the refund claim could be decided afresh in accordance with the correct valuation base.

Ratio Decidendi: In valuation of goods produced by a 100% export-oriented unit and cleared in India, only expenses up to the legally relevant place of removal are includible, and any amount whose character is disputed must be factually determined before deciding whether it forms part of assessable value.

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