MRP-based excise valuation applies to notified retail packs even when goods are moved in outer cartons for repacking.

Section 4A of the Central Excise Act applies to notified goods sold in packages that are required by law to bear retail sale price. Chocolates cleared as individually packed retail packs bearing MRP remained covered by the MRP-based valuation regime even when placed in cardboard outers for repacking into assortment packs. The claim that the outer carton was a wholesale package under the Package Commodities Rules did not succeed because the movement was not a bulk sale to an intermediary for further distribution in smaller quantities. The exemption from MRP marking under Rules 29 and 34 was not established, so duty was payable on MRP-based value and the demand and penalty were sustained.

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Issues: Whether the chocolates cleared in cardboard outers to a job worker for repacking into assortment packs were liable to duty under Section 4A of the Central Excise Act, 1944 on the basis that the individual retail packs already bore MRP and there was a statutory requirement to declare MRP on the package.

Analysis: Section 4A applies only where the goods are sold in packages and the relevant law requires declaration of retail sale price on the package. The chocolates in question were individually packed retail packs bearing MRP, were covered by the notification under Section 4A, and were cleared in outers without any marking showing that they were not meant for sale to the ultimate consumer. The plea that the outer carton was a wholesale package under Rule 2(x)(ii) of the Standards of Weights and Measures (Package Commodities) Rules, 1977 did not help the appellant because the clearances were not bulk sales to an intermediary for distribution in smaller quantities, but movement of one retail pack for repacking into another retail assortment pack. The exemption from MRP marking under Rules 29 and 34 was not established.

Conclusion: Section 4A was applicable and duty was correctly payable on the MRP-based value.

Final Conclusion: The demand and penalty were sustained and the appeal failed.

Ratio Decidendi: Where a notified commodity is cleared in a package that is required by law to bear MRP, Section 4A applies notwithstanding that the goods are further packed or repacked in a larger outer carton for convenience of distribution.

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