Section 4 prior to 1.7.2000
- Valuation of excisable goods for purposes of charging of duty of
excise.-
- Where under this Act, the duty of excise is chargeable on any
excisable goods with reference to value, such value, shall, subject to
the other provisions of this section, be deemed to be—
(a) the normal price thereof, that is to say, the price at which such
goods are ordinarily sold by the assessee to a buyer in the course of
wholesale trade for delivery at the time and place of removal, where the
buyer is not a related person and the price is the sole consideration
for the sale:
Provided that—
(i) where, in accordance with the normal practice of the wholesale trade
in such goods, such goods are sold by the assessee at different prices
to different classes of buyers (not being related persons) each such
price shall, subject to the existence of the other circumstances
specified in clause (a), be deemed to be the normal price of such goods
in relation to each such class of buyers;
(ia) where the price at which such goods are ordinarily sold by the
assessee is different for different places of removal, each such price
shall, subject to the existence of other circumstances specified in
clause (a), be deemed to be the normal price of such goods in relation
to each such place of removal;
(ii) where such goods are sold by the assessee in the course of
wholesale trade for delivery at the time and place of removal at a price
fixed under any law for the time being in force or at a price, being the
maximum, fixed under any such law, then, notwithstanding anything
contained in clause (iii) of this proviso, the price or the maximum
price, as the case may be, so fixed, shall, in relation to the goods so
sold, be deemed to be the normal price thereof;
(iii) where the assessee so arranges that the goods are generally not
sold by him in the course of wholesale trade except to or through a
related person, the normal price of the goods sold by the assessee to or
through such related person shall be deemed to be the price at which
they are ordinarily sold by the related person in the course of
wholesale trade at the time of removal, to dealers (not being related
persons) or where such goods are not sold tosuch dealers, to dealers
(being related persons), who sell such goods in retail;
(b) where the normal price of such goods is not ascertainable for the
reason, that such goods are not sold or for any other reason, the
nearest ascertainable equivalent thereof determined in such manner as
may be prescribed.
- Where, in relation to any excisable goods the price thereof for
delivery at the place of removal is not known and the value thereof is
determined with reference to the price for delivery at a place other
than the place of removal, the cost of transportation from the place of
removal to the place of delivery shall be excluded from such price.
- The provisions of this section shall not apply in respect of any
excisable goods for which a tariff value has been fixed under
sub-section (2) of section 3.
- For the purposes of this section,—
(a) "assessee" means the person who is liable to pay the duty of excise
under this Act and includes his agent;
(b) "place of removal" means—
(i) a factory or any other place or premises of production or
manufacture of the excisable goods;
(ii) a warehouse or any other place or premises wherein the excisable
goods have been permitted to be deposited without payment of duty;
(iii) a depot, premises of a consignment agent or any other place or
premises from where the excisable goods are to be sold after their
clearance from the factory and, from where such goods are removed;
(ba) "time of removal", in respect of goods removed from the place of
removal referred to in sub-clause (iii) of clause (b), shall be deemed
to be the time at which such goods are cleared from the factory;
(c) "related person" means a person who is so associated with the
assessee that they have interest, directly or indirectly, in the
business of each other and includes a holding company, a subsidiary
company, a relative and a distributor of the assessee, and any
sub-distributor of such distributor.
Explanation.—In this clause "holding company", "subsidiary company" and
"relative" have the same meanings as in the Companies Act,1956 (1 of
1956);
(d) "value", in relation to any excisable goods,-
- where the goods are delivered at the time of removal in a packed
condition, includes the cost of such packing except the cost of the
packing which is of a durable nature and is returnable by the buyer
to the assessee.
Explanation.—In this sub-clause, "packing" means the wrapper,
container, bobbin, pirn, spool, reel or warp beam or any other thing
in which or on which the excisable goods are wrapped, contained or
wound;
- does not include the amount of the duty of excise, sales tax and
other taxes, if any, payable on such goods and, subject to such
rules as may be made, the trade discount (such discount not being
refundable on any account whatsoever) allowed in accordance with the
normal practice of the wholesale trade at the time of removal in
respect of such goods sold or contracted for sale.
Explanation.—For the purposes of this sub-clause, the amount of the
duty of excise payable on any excisable goods shall be the sum total
of -
- the effective duty of excise payable on such goods under
this Act; and
- the aggregate of the effective duties of excise payable
under other Central Acts, if any, providing for the levy of
duties of excise on such goods, and the effective duty of excise
on such goods under each Act referred to in clause (a) or clause
(b) shall be-
- in a case where a notification or order providing for
any exemption (not being an exemption for giving credit with
respect to, or reduction of duty of excise under such Act on
such goods equal to, any duty of excise under such Act, or
the additional duty under section 3 of the Customs Tariff
Act, 1975 (51 of 1975), already paid on the raw material or
component parts used in the production or manufacture of
such goods) from the duty of excise under such Act is for
the time being in force, the duty of excise computed with
reference to the rate specified in such Act, in respect of
such goods as reduced so as to give full and complete effect
to such exemption; and
- in any other case, the duty of excise computed with
reference to the rate specified in such Act in respect of
such goods.
(e) "wholesale trade" means sales to dealers, industrial
consumers, Government, local authorities and other buyers,
who or which purchase their requirements otherwise than in
retail.