This valuation method is used if all other methods are not applicable

(i.e neither tariff value nor compounded levy scheme nor duty based on production capacity or retail sales price are not applicable)

In this case only, transaction value method is used for valuation


What is transaction value in Excise?

Transaction Value means

Price actually paid/payable for goods

And includes

Any amount which buyer is liable to pay

by reason of or in connection to sale


It includes any amount charged for

  • Advertisement/Publicity
  • Marketing
  • Storage
  • Warranty
  • Commission etc


It does not include

  • Excise duty
  • Sales tax
  • Any other tax

Exam Questions

Question 14
Define the term ''transaction value" as per Central Excise Act, 1944.

As per section 4 of the Central Excise Act, 1944, transaction value means the price actually
paid or payable for the goods, when sold, and includes in addition to the amount charged as

  • any amount that the buyer is liable to pay to, or on behalf of, the assessee, by reason of,
    or in connection with the sale, whether payable at the time of the sale or at any other
    time, including, but not limited to,
  •  any amount charged for, or to make provision for, advertising or publicity, marketing and
    selling organization expenses, storage, outward handling, servicing, warranty,
    commission or any other matter;
  •  but does not include the amount of duty of excise, sales tax and other taxes, if any,
    actually paid or actually payable on such goods.
Go Ad-free
CA Maninder Singh's photo - Co-founder, Teachoo

Made by

CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 14 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.