Presentation on Duty based on the value arrived at on basis of Valuation under Section 4.Sec 3(2),(Sec 4A). Most relevent and easily defined presentation.

1. Section – 4
Valuation of Goods under
Transactional Basis
Presented by:
Team 2

2. Basis of computing duty payable
Specific duty
Duty based on value
a)Duty based on the Tariff value{ Sec 3(2)}
b)Duty based on the value arrived at on basis of
Valuation under Section 4
c)Duty based on Maximum retail price (Sec 4A)
Compounded levy scheme
Duty based on capacity of production

3. Transactional value
It is the price actually paid or payable for the goods
when sold and includes in addition to the amount
charged as price, any amount that the buyer is liable
to pay to or on behalf of, the assesse, by reason of,
or in connection with sale, whether payable at the
time of sale or any other time, including but not
limited to, any amount charged for, of making
provision for advertising, publicity, storage or any
other matter; but does not include the amount of
duty of excise, sales tax or other taxes, if any
actually paid or actually payable to such goods.

4. Valuation under Section 4
• With the intention of making valuation mechanism
simple, from July 2000valuation mechanism based on
‘normal price 'was replaced by user friendly mechanism
based on transactional value. Sec 4 reads as under:
• Under the act the duty of excise chargeable on any
excisable goods with reference to their value , then , on
each removal of goods, such value shalla)In case where goods sold by assesse, for delivery at the
time and place of the removal, the assesse and buyer of the
goods are not related and price is the sole consideration for
sale, be transactional value
b) In any other case where the goods are not sold , be the
value determined in such manner as may be prescribed.

5. • Provisions of this section not apply in respect any
excisable goods for which tariff value fixed under
sub-section (2) of section 3.
• In this section assesse is a person who is liable to
pay excise duty includes his agent.
• Person shall deemed to be ‘related 'if
1. They are interconnected undertakings
2. They are relatives
3. Buyer is a relative and a distributer of assesse or
sub distributer of the distributer
4. They are associated having interest directly or
indirectly in the business of each other.

6. Scheme of Valuation under Central excise
Valuation
under central
excise
Are tariff fixed
under Sec
3(2)
Yes
Valuation
under Section
3(2)
Yes
Valuation
under Section
4A
No
Valuation with ref. to retail
sale price and noticed for
MRP based levy under law
No
Valuation
under Section
4

7. Scheme of Valuation under Section 4
Scheme under Section 4
Duty chargeable with reference to value
Where the value at which
goods are sold by assesse
to be the transactional
value
Delivery at
the time of
removal
Delivery at
the place of
removal
Goods not sold or any of
four conditions is not
fulfilled – Central excise
valuation(DPEG) rules
2000
Buyer being
not related
person
Price is the
sole
consideration

8. Situations where transactional value
does not apply
As given in chart for valuation scheme under section
4 there are 4 condition to be fulfilled.
1. There should be sale of good.
2. The goods should for delivery at the time and
place of removal
3. The assesse and buyer of goods are not related
person
4. The price should be sole consideration for sale.
In those case any of above conditions are missing
the assessable value shall be determined on basis of
the Central Excise Valuation dated 30.06.2000.

9. Thank
You