In Brief
The Supreme Court addressed conflicting views on whether ancillary service charges (packing, facility, delivery, etc.) charged by manufacturers of industrial gases and allied products must be included in the assessable value for excise duty purposes. The Court held that the measure of a tax (its value base) is not controlled by its nature (being a manufacture duty), so long as reasonable nexus exists between the two. Section 4 'transaction value' properly includes value-adding services incurred up to the point of sale. The Court reconciled apparent conflicts in earlier decisions, confirming that Bombay Tyre International Ltd. (not Acer India Ltd.) states correct law: value additions enriching the product's marketability are includible, except where a non-dutiable item's value is added to a dutiable item.
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