Procedural price-declaration lapse cannot sustain differential excise duty without proof of faulty assessable value; penalty upheld.

Mere non-filing of a revised price declaration under Rule 173C did not, by itself, justify a demand for differential central excise duty when the department produced no evidence that the assessable value failed the requirements of Section 4(1)(a) of the Central Excise Act, 1944; the duty demand was therefore unsustainable. The statutory obligation to file the price declaration remained binding, however, and the penalty for that procedural lapse was upheld. The matter thus reflects a distinction between substantive valuation requirements for duty liability and separate compliance-based penalty consequences for breach of the declaration rule.

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Issues: (i) Whether differential duty could be demanded merely because the assessee did not file a revised price declaration under Rule 173C despite selling goods at a lower price; (ii) Whether the penalty for non-fulfilment of the declaration requirement was sustainable.

Issue (i): Whether differential duty could be demanded merely because the assessee did not file a revised price declaration under Rule 173C despite selling goods at a lower price.

Analysis: The only basis for the demand was non-filing of a revised price declaration. The absence of such procedural compliance, by itself, could not justify a duty demand unless there was evidence that the price or assessable value adopted by the assessee did not satisfy the requirements of Section 4(1)(a) of the Central Excise Act, 1944. In the absence of any such evidence, the demand for differential duty could not be sustained.

Conclusion: The differential duty demand was not sustainable and is set aside in favour of the assessee.

Issue (ii): Whether the penalty for non-fulfilment of the declaration requirement was sustainable.

Analysis: Filing of the price declaration under Rule 173C was a statutory obligation. That requirement had not been complied with, and the record justified sustaining the penalty imposed for that lapse.

Conclusion: The penalty was upheld against the assessee.

Final Conclusion: The appeal succeeded on the duty demand but failed on the penalty, resulting in partial relief to the assessee.

Ratio Decidendi: Mere breach of a procedural price-declaration requirement cannot sustain a demand for differential duty unless the department establishes that the assessable value fails the substantive valuation requirements under Section 4(1)(a) of the Central Excise Act, 1944.

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