MODI RUBBER LIMITED S ANOTHER vs UNION OF INDIA & OTHERS

The Supreme Court addressed the interpretation of the Explanation to Section 4(4)(d)(ii) of the Central Excises and Salt Act, 1944, clarifying that only the excise duty actually paid after exemptions qualifies for deduction from the wholesale price to determine the assessable value of goods. The Court upheld the view of the Delhi High Court in I.T.C. Limited v. Union of India, emphasizing that the assessable value must be determined before applying any exemption notifications. The judgment confirmed the legal principle that the duty of excise leviable must be calculated first, and the exemptions applied thereafter, thereby resolving the controversy surrounding the computation of excise duty.