Revised MRP stickers and denied cross-examination shaped excise valuation and demand sustainability in LPG stove clearances.

A revised MRP sticker affixed before clearance can be acted on for valuation under Section 4A of the Central Excise Act, so duty was to be based on the lower sticker MRP and not the higher originally printed MRP. A demand alleging clearance of LPG stoves as bio-gas stoves, where it substantially depended on dealer statements, could not be sustained when cross-examination was denied; that matter was remanded for de novo adjudication after cross-examination. A demand based on duplicate impressions from a blank invoice book and alleged clandestine removals also failed for want of sufficient supporting evidence, and was set aside.

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Issues: (i) whether duty on LPG stoves cleared with a revised MRP sticker was liable to be computed on the originally printed higher MRP under Section 4A of the Central Excise Act, 1944; (ii) whether the demand based on alleged clearance of LPG stoves in the guise of bio-gas stoves could be sustained without affording cross-examination of the dealers; (iii) whether the demand based on impressions from a blank invoice book and alleged clandestine removals was sustainable.

Issue (i): whether duty on LPG stoves cleared with a revised MRP sticker was liable to be computed on the originally printed higher MRP under Section 4A of the Central Excise Act, 1944.

Analysis: The cartons bore an originally printed MRP, but the assessee affixed a sticker showing a lower revised MRP before clearance. The Tribunal held that affixing a sticker indicating the revised MRP is permissible under Rule 6 of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977, and that such affixation does not amount to declaration of two MRPs. The assessable value, therefore, had to be determined on the revised MRP shown on the sticker and not on the higher MRP originally printed.

Conclusion: The demand on this ground was not sustainable and was set aside in favour of the assessee.

Issue (ii): whether the demand based on alleged clearance of LPG stoves in the guise of bio-gas stoves could be sustained without affording cross-examination of the dealers.

Analysis: The allegation rested mainly on the statements of dealers, while the supply orders on record indicated supply of bio-gas stoves and suggested that the dealers dealt in such goods. Since the assessee sought cross-examination of the dealers, and the demand substantially depended on their statements, denial of cross-examination was held to be improper. The matter required fresh adjudication after allowing cross-examination.

Conclusion: The demand on this ground was set aside and remanded for de novo adjudication in favour of the assessee.

Issue (iii): whether the demand based on impressions from a blank invoice book and alleged clandestine removals was sustainable.

Analysis: The demand was founded on duplicate impressions from a blank invoice book found in the factory. Except for one dealer, no meaningful inquiry was made with the other alleged buyers, and the supporting evidence was found insufficient to sustain the charge of clandestine clearance.

Conclusion: The demand on this ground was not sustainable and was set aside in favour of the assessee.

Final Conclusion: The Tribunal set aside the confirmed demands except that one allegation was sent back for fresh adjudication after permitting cross-examination, resulting in only partial relief to the assessee.

Ratio Decidendi: A revised MRP sticker affixed before clearance can supersede the originally printed MRP for valuation under Section 4A, and a demand substantially founded on witness statements cannot be sustained where cross-examination is wrongly denied.

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