COLLECTOR OF CENTRAL EXCISE, DELHI vs KELVINATOR OF INDIA LTD.

The Supreme Court held that the optional four-year service contract for refrigerators, which is entered into after the initial one-year warranty period, is not includible in the assessable value under Section 4 of the Central Excises and Salt Act, 1944. The Court affirmed the Tribunal's decision, emphasizing that the service contract is an after-sale facility and that consumers are not compelled to purchase it. The judgment referenced Union of India v. Bombay Tyre International Ltd. and Assistant Collector of Central Excise v. Madras Rubber Factory Ltd. to support its conclusion.