2004 (9) TMI 103 - SUPREME COURT

Whether the declaration made by an assessee on a package of cigarettes disempowered the revenue from going behind the declaration?

Held that:- In our opinion the outcome of this would be equally illogical. It envisages an excise officer in one part of the country determining what would be the reasonable market price through out the country for that particular brand, an exercise which the Tribunal itself concedes would require the examination of the cost data and market considerations and would be a "very complicated and time consuming impractical exercise which was rightly not provided for". And yet according to the Tribunal's and the Revenue's interpretation of the notification the 1985 and the 1983 , the Excise Officer would have had to do just that. Apart from the patent ipracticability of the matter, the question whether the price so fixed by the Excise authority is 'reasonable' or not would itself be justiciable with the consequent blockage of revenue in the quagmire of litigation. That is precisely what the Notification had sought to avoid.

The certainty of specific rates which was sought to be achieved by the notification has been undone by the adjudicating authority and the Tribunal. The notification had introduced a system for levy of excise duty on an experimental basis. If the experiment was a failure for whatever reason, it was open to the respondents to do away with it and replace the system by some other as it did in 1987. But as long as the notification stood, it had to be given effect to. In the view we have taken, there is no need to go into other questions debated before us