In Brief
A manufacturer of chewing tobacco collected voluntary charitable donations called "Dharmada" from customers alongside the sale price and remitted these to charity. The Central Excise authority included Dharmada in the assessable value to levy excise duty, treating it as part of the transaction price. The Supreme Court held that Dharmada—being a voluntary charitable donation earmarked for charity and not consideration for the goods—cannot be included in the transaction value under the Central Excise Act. The seller acts merely as a conduit between buyer and charity. The purchase of goods is the occasion, not the consideration, for Dharmada. Therefore, such amounts cannot form part of the assessable value for excise duty purposes.
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