According to an official release, transaction value-based assessment, however, will not be applicable if the goods were sold to a related person. "In such cases the valuation rules shall apply," said the release.

Under the new assessment system based on transaction value, it will be immaterial whether the goods were sold by the assessee in wholesale or retail.

Different transaction values for goods sold on commercial basis are permissible in the new system - each transaction can get value on its own merits.

The interest charged on delayed payments as per trade practice and on agreement between the buyer and seller will not form part of the assessable value.

The cost of transportation between the factory and the place of delivery, if charged and shown specifically, will also be excluded from the assessable value.

Goods transferred to depots will assessed to duty at normal transaction value prevailing at the depot under the new system.

Discounts allowed as per trade practice and passed on to the buyers will be excluded, whereas, the cost of packing from the buyer, service charges, warranty charges realised from the buyer will be included in transaction value.

The release said that separate instructions had been issued for valuation of petroleum products. It has been prescribed that even after the assessable value gets increased for any situation because of technical interpretation, the assessment should be done at pre July 1, 2000, assessable value on professional basis.

This was to ensure that no price increase took place in respect to price administered products like HSD, motor spirit and kerosene, and that there was no cause for disruption in the movement of petroleum products.

Finance ministry sources said that the new system would make the calculation simpler and will remove the problems related to interpretation. It was expected to make the valuation for assessment of excisable goods more systematic and in tune with international practices, said the release.