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TMI Blog2020 (7) TMI 488X X X X Extracts X X X X X X X X Extracts X X X X ..... ual amount of penalty was imposed; goods valued at Rs. 1,18,59,330/- were confiscated; redemption fine of Rs. 20,00,000/- was imposed on M/s Microtrack Business Systems Pvt Ltd. Penalty of Rs. 3,00,000/- was imposed on Shri Rajiv Tibrewal under Section 112 (a) of the Customs Act, 1962. 2. Brief facts of the case are that the appellant M/s Microtrack Business Systems Pvt Ltd are engaged in the business of sugar confectionary of various types such as soft chocolates, candies and other confectionary items; they have their own sales outlets operated as 'Candy Bar' at Delhi, Kolkata, Mumbai, Bangalore, Cochin, Ludhiana and Jaipur operated by their own sister concern viz M/sToras Confectionary India Pvt Ltd. or by their exclusive franchisees; di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned order dated 19.11.2010, confirming the duty and penalty as above. Being aggrieved with the said impugned order, the appeals were preferred as above. 3. The learned Advocate appearing for the appellants submitted that the goods in question were never sold to the ultimate buyers in packaged form and thus, the provisions of Standards of Weights and Measures (Packaged Commodities) Rules, 1977 would not be applicable for determination of value under Section 4A of the Central Excise Act, 1944. He has relied upon the Circular No. 625/16/2002- CX., dated 28.02.2002 issued by the CBEC to state that since the retail sell of confectionary items was effected to the ultimate consumers in loose form, the appellant was not under any statutory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... short, the "SWM Rules"). 7. Valuation of excisable goods with reference to retail sale price is contained in Section 4A of the Central Excise Act, 1944. The said statutory provisions mandate that in case of sale of the excisable goods in packaged form, where the packages are required to be mentioned with the price thereof under the SWM Act, SWM Rules or any other law, then the valuation would be determined on the basis of the retail sale price of such goods declared in the packages. Various expressions namely, 'retail dealer', 'retail package', 'retail sale', 'retail sale price' etc. have been defined in Rule 2 of the SWM Rules, 1977. The phrase 'sell of such packages/commodities' are commonly findi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircular dated 28.02.2002 has clarified that if there is no statutory obligation under the provisions of SWM Rules to declare the retail sale price of the packages, then the provisions of Section 4A would not be applicable. 9. The issue arising out of the present dispute with regard to determination of the value under Section 4A of the Act has been dealt with by the Hon'ble Apex Court in the case of Jayanti Food Processing Pvt. Ltd. (Supra), wherein it has been held that Section 4A of the Central Excise Act, 1944 would not be applicable in cases where the goods are sold in retail in loose or unpackaged condition. The relevant paragraphs in the said judgment are extracted herein below: "9. The assessee is engaged in manufacturing of ic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts appearing in the orders of the authorities below which suggest that at one point of time the assessee used to display the MRP on the four litres pack voluntarily. Shri Subba Rao very heavily relied on this fact. We do not think that merely because the assessee displayed the MRP on the four litres pack, that would negate the case of the appellant altogether. We have already shown in the earlier part of the judgment the conditions required for application of Section 4A. The plain language of Section 4A(1) unambiguously declares that for its application there has to be the "requirement" under the SWM Act or the Rules made thereunder or any other law to declare the MRP on the package. If there is no such requirement under the Act and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere as the 4 litre pack is not meant to be sold to the consumer directly. We would have to essentially go through to the definition of "retail package" and one look at Rule 2(p) would show that in order to be covered under that definition such package must have been intended for "retail sale" for consumption by an individual or a group of individuals. In our view these two definitions would have to be read together to properly understand the scope thereof. In order that the package should be properly described as a "retail package", the sale has to be through the "retail sale" for consumption by an individual or a group of individuals. In the present case, admittedly, the sale of the package was only to the hotel. It may be that the hotel m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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