valution under central ecxise

[MOHAMED RAFIQ]

whether royalty paid to state govt.for extraction of ,minerals is a statutory levy or tax.if so,while calculating excisable value the value of royalty canbe excluded

[NEERAJ KUMAR, RANCHI]

Yes, value of royalty should be excluded while calculating total assessable value. Excise duty is paya ble excluding royalty.

[Vijay kumar]

As per Black's Law Dictionary, Royalty is compensation paid for use of natural resources. Hence it doesn't seem to be a tax to get exclusion in terms of Section 4 of the Central excise act under the definition of "transaction value". Accordingly, no deduction would be admissible while computation of  the AV for  payment of excise duty.

AI Summary

Royalty exclusion in excise valuation: competing views on whether mineral extraction royalty reduces assessable value. Whether royalty paid to a state government for mineral extraction is deductible from central excise assessable value is disputed: one view treats royalty as deductible from the total assessable value so excise is payable net of royalty, while a contrary view treats royalty as compensation for use of natural resources forming part of transaction consideration, so no deduction is admissible when computing assessable value.