MRP-based valuation applies to packaged goods where section 4A conditions are met and MRP is affixed on clearance.

Air-conditioners up to 3.0 TR sold directly to customers were treated as goods assessable under section 4A of the Central Excise Act, 1944, not under section 4, because they were covered by Notification No. 13/2002-CE(NT), fell within the packaged commodities regime, were not excluded by Rule 34, and carried MRP declarations at clearance. The Tribunal relied on the supporting circular, case law, and the settled principle that MRP-based valuation applies once the statutory conditions for section 4A are met. The impugned order was sustained and the demand, penalty, and interest did not survive.

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Issues: Whether air-conditioners up to 3.0 TR sold direct to customers were liable to be assessed under section 4 of the Central Excise Act, 1944, or under section 4A of the Central Excise Act, 1944 on MRP-based valuation.

Analysis: The goods were covered by Notification No. 13/2002-CE(NT) and the Commissioner (Appeals) had found that the relevant circular and case law supported assessment under section 4A where the goods are specified for such valuation and are required to bear retail price declarations. The Tribunal also noted that the Supreme Court had held that once goods are specified under section 4A, are covered by the applicable weights and measures law, are not excluded by Rule 34, and are cleared with MRP affixed, valuation under section 4A is proper.

Conclusion: The goods were correctly assessable under section 4A and not under section 4. The Revenue's appeal failed and the assessee succeeded.

Final Conclusion: The impugned order was sustained, and the demand, penalty, and interest did not survive.

Ratio Decidendi: Where goods are specified for section 4A valuation, are covered by the packaged commodities regime, are not exempted, and bear MRP on clearance, assessment must be made under section 4A rather than section 4.

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