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2020 (12) TMI 504 - CESTAT NEW DELHIInterpretation of statute - rule 3 of Central Excise Rules - Provisions Applicable to Packages Intended for Retail Sale - Method of Valuation - wall putty in packages of 40kg - to be valued under section 4 of the Central Excise Act, 1944 or under section 4A of the Excise Act? - Extended period of limitation - Legal Metrology Department clarified to the Appellant that “if wall putty is packed in packages above 25 kgs, as per Rule 3(a) of the said Rules, the provisions of Chapter II including Rule 6(1)(e), (requiring printing of MRP) do not apply to such packages” and further that “packages of 40 kg and 50 kg of all the goods other than cement & fertilizer, are exempted from affixing of MRP declaration. HELD THAT:- Merely because MRP was declared on the package will not mean that the valuation of the excisable goods for the purposes of charging of duty of excise should be carried out under section 4A of the Excise Act, if otherwise in law, the valuation is required to be undertaken under section 4 of the Excise Act. The Board by a Circular dated February 28, 2002, has also clarified that section 4A of the Excise Act will not be attracted when there is no statutory requirement of affixing MRP on the goods in question, even though an assessee may have voluntarily affixed the MRP on such goods. As the appellant had cleared wall putty in packages of 40 kg, the provisions of rule 6 contained in Chapter II of the Rules will not apply and if this be so, the provisions of section 4A of the Excise Act under which the value of goods is deemed to be the retail sale price declared on such goods, would not be applicable. The appellant was, therefore, justified in determining the value of the goods under section 4 of the Excise Act. In H & R JOHNSON (INDIA) LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, RAIGAD [2014 (6) TMI 453 - CESTAT MUMBAI] the assessee cleared tiles in retail packages to real estate developers after affixing MRP and paid duty on MRP basis under section 4A of the Excise Act. The Department contended that since the sales were made to institutional/industrial consumers, the Rules would have no application and duty must be paid under section 4. The Tribunal held that there is no difference in respect of packages sold to retail customers and sold to the alleged industrial consumers. The Tribunal also held that the clarifications issued by the Legal Metrology Department, cannot be disregarded. The decision would have no application in the present case since there is no requirement to examine whether the 40 kg packages are capable of being sold in retail since such packages are outrightly excluded from the purview of the Rules. The Principal Commissioner was not justified in concluding that the valuation of wall putty in packages of 40 kg was required to be determined under section 4A of the Excise Act - Appeal allowed - decided in favor of appellant.
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