Factory gate price controls depot valuation, and handling charges are excluded from assessable value in excise.

Where factory gate price was available for a substantial part of the clearances, depot clearances were to be valued on that basis for central excise purposes, and handling charges recovered on goods cleared from the sales depot were not includible in assessable value. The valuation dispute was confined to the present proceedings, while any separate grievance about recovery of duty on other price elements could be pursued, if at all, under Section 11D of the Central Excise Act, 1944. On that reasoning, the valuation adopted in the impugned order was set aside.

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Issues: Whether handling charges recovered on goods cleared from the sales depot were includible in the assessable value for central excise purposes.

Analysis: The factory gate price was available for a substantial part of the clearances, and the assessable value for depot clearances was to be determined on that basis. The dispute concerned only valuation in the present proceedings. Any separate grievance regarding recovery of duty on other price elements could be proceeded with, if at all, under Section 11D of the Central Excise Act, 1944.

Conclusion: Handling charges were not includible in the assessable value. The issue was decided in favour of the assessee.

Final Conclusion: The appeal succeeded and the valuation adopted in the impugned order was set aside.

Ratio Decidendi: Where factory gate price is available, depot clearances are to be valued on that price and handling charges are not includible in assessable value.

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