BURN STANDARD COMPANY LTD. AND ANR. vs UNION OF INDIA AND OTHERS

The Supreme Court held that under Sections 3 and 4 of the Central Excise and Salt Act, 1944, excise duty is to be levied on the value of the complete wagon manufactured by the appellant, including components termed as 'free supply items'. The Court clarified that these items lose their identity and become part of the complete product, thus the duty is assessed based on the normal price of the complete wagon. The appeal was dismissed, affirming the lower court's decision that the appellant is liable for excise duty on the full value of the wagon.