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Issues: Whether goods cleared with maximum retail price marked on the packages were liable to assessment under section 4A of the Central Excise Act, 1944 when the supplies were made for onward distribution to the Canteen Stores Department and were not intended for retail sale.
Analysis: Section 4A applies only where the goods are both specified in the relevant notification and covered by the Standards of Weights & Measures (Packaged Commodities) Rules, 1977. The obligation to declare maximum retail price is connected with packages intended for retail sale, and the Rules themselves contain exclusions, including goods covered by rule 34 and pre-packaged goods sold to institutional consumers under rule 2A(b). The mere printing of maximum retail price does not by itself attract section 4A if the goods are not meant for retail sale. On the facts, the goods were supplied for distribution through the Canteen Stores Department, which functions as an institutional procurement and distribution mechanism rather than a retail outlet, and the clearances were made pursuant to supplies meant for that restricted clientele. The circular relied upon by the assessee was held applicable, and the departmental view that only bulk supplies were excluded was rejected.
Conclusion: Section 4A was not applicable; the assessable value had to be determined under section 4 of the Central Excise Act, 1944, and the duty demand could not survive.
Ratio Decidendi: Section 4A can be invoked only when the goods are intended for retail sale and are required to comply with the packaged commodities rules; mere affixation of maximum retail price on goods supplied to an institutional consumer does not make them assessable under section 4A.
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