Section 4 valuation applies to free promotional talcum powder packs not intended for retail sale, not Section 4A.

Talcum powder cleared in 25 gram packs as free goods with bathing bars, and marked as not intended for retail sale, was held to fall outside Section 4A valuation because no MRP was required on the packages. Rule 3 of the Packaged Commodities Rules excludes goods not intended for retail sale, and the Board circular recognised that free promotional supplies without a statutory MRP obligation are not assessable under Section 4A. The goods were therefore correctly valued under Section 4, and the demand was unsustainable.

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Issues: Whether talcum powder cleared in 25 gram packages, marked as free with bathing bars and not intended for retail sale, was liable to valuation under Section 4A of the Central Excise Act, 1944 or under Section 4.

Analysis: The packages were cleared without MRP and were specifically described as not for retail sale and as free goods supplied along with another consumer product. Rule 3 of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 excludes goods not intended for retail sale. The applicable Board circular also clarified that where goods are supplied free as part of a marketing strategy and there is no statutory obligation to print MRP, Section 4A does not apply. The reasoning in the cited precedent supported the same principle.

Conclusion: The goods were correctly valued under Section 4 and not under Section 4A, and the demand was unsustainable.

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