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Issues: (i) Whether a multi-pack of three soaps, each bearing a visible MRP on the individual pack, was assessable under Section 4A on the MRP printed on the multi-pack or on the aggregate MRP of the individual packs. (ii) Whether penalty was imposable in the circumstances.
Issue (i): Whether a multi-pack of three soaps, each bearing a visible MRP on the individual pack, was assessable under Section 4A on the MRP printed on the multi-pack or on the aggregate MRP of the individual packs.
Analysis: The individual packs carried visible MRPs and were not shown to have their MRPs scored out or deleted. The Board's circular on valuation of multi-piece packages clarified that where the individual items in a multi-pack do not state that they are not to be sold separately and are capable of being sold separately at the MRP printed on them, the aggregate MRP of the pieces is to be adopted for duty under Section 4A. The wrapper arrangement did not alter the fact that the individual MRPs remained visible, and the case law relied upon for the assessee was distinguishable on facts.
Conclusion: The valuation was correctly taken on the basis of the aggregate MRP of the individual soap cakes, and the assessee's challenge failed.
Issue (ii): Whether penalty was imposable in the circumstances.
Analysis: The dispute turned on valuation and interpretation of the applicable valuation provision. No fraud, collusion, wilful misstatement, suppression of facts, or deliberate contravention with intent to evade duty was established.
Conclusion: Penalty was not imposable and was waived.
Final Conclusion: The duty and interest demand were sustained on the valuation issue, but the penalty was set aside, resulting in partial relief to the assessee.
Ratio Decidendi: For multi-piece packages, where the individual items bear visible MRPs and remain capable of separate sale without any declaration that they are not to be sold separately, duty under Section 4A is to be computed on the aggregate MRP of the individual items, and penalty is not warranted in the absence of any allegation of fraud or intent to evade duty.
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