C. S. P. SINGH, J.

( 1 ) THE petitioner, which is a public limited company, manufactures dry cell batteries and torches of various types and sizes. The batteries are subject to ad valorem excise duty under the Central excises Act. For purposes of determining the excise duty, the petitioner has to submit a price that of torches and batteries for determination of their assessable value on which the excise duty has to be paid. The Assistant Collector or the Superintendent, Central Excise is entitled to approve the price list or modify it by enhancing the assessable value. In the year 1976, the petitioner submitted three price lists on account of the revision of the rate of duty on torches and batteries. The price lists submitted by the petitioner included the cost of packing batteries in card board cartons. It was stated in these price lists that in theevent of batteries being sent in wooden boxes at the request of the customers, extra packing charges were being recovered by the petitioner. The Assistant Collector, Central Excise, Allahabad, however, added the cost of packing charges in wooden boxes to the assessable value. He passed three orders in respect of the price lists submitted by the petitioner on 27-3-1976, 5-4-1976 and 10-8-1976. The petitioner filed three appeals against these orders under Section 35 of the Act. The Appellate Collector, Central excise, New Delhi disposed of the appeals by a common order dated 28-10-1976, holding in favour of the petitioner. On 11-4-1977 the Government of India acting in exercise of powers conferred under Section 36 (2) of the Act, issued a show cause notice to the petitioner as to why the appellate order should not be set aside, and the value of wooden boxes added to the assessable value. The petitioner sent a reply to the notice on 7-5-1977. The Central Government, however, by its order dated 9-5-1979 reversed the appellate order so far as exclusion of the cost of packing in wooden boxes, and held that these charges should be included in the assessable value for purposes of determination of the excise duty. The petitioner has challenged this order.

( 2 ) COUNSEL for the petitioner urged that excise duty can be charged only on the manufacturing cost of the article in question, and post-manufacturing expenses cannot be included in the assessable value. It was contended that the cost of manufacturing the batteries comes to a close after batteries are manufactured, and packed in card-board cartons for sale. The cost of packing in wooden boxes is not a part of the manufacturing cost, as it is incurred by the petitioner on the special request of the customers, who want to ensure that the articles are not damaged when they are taken to far out destinations. A large number of authorities have been cited in support of this contention. We will refer to them shortly. But before we do so, it is necessary to extract relevant provisions of Section 4 of the Central Excise Act as it stood at the relevant point of time. "4. Valuation of excisable goods for purposes of charging of duty of excise.- (1) 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. * * * * (4) For the purposes of this Section : * * * * (d) "value" in relation to any excisable goods (i) 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 or an

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