MRP valuation for packaged water depends on whether goods are retail packs or institutional supplies; remand ordered for verification.

Packaged drinking water supplied in the same area may attract different valuation treatment depending on whether it is sold as retail packs or supplied to institutional buyers: retail packs are ordinarily assessed on declared MRP under section 4A of the Central Excise Act, 1944, while institutional clearances may fall under section 4 on transaction value. The Tribunal noted that the show cause notice did not specifically allege section 4 valuation for institutional supplies and that the record did not clearly establish whether two distinct classes of consumers existed or whether duty had been consistently discharged on all clearances. As these factual aspects required verification, the impugned orders were set aside and the matter was remanded for fresh consideration, leaving all issues open.

---

---

Issues: Whether, for identical packaged drinking water supplied in the same area, different retail sale prices could be affixed for institutional packs and regular packs, and whether the matter required verification as to the nature of clearances and the duty basis adopted.

Analysis: The dispute turned on the applicability of MRP-based valuation under section 4A of the Central Excise Act, 1944 and the treatment of goods supplied to institutional buyers. The Tribunal noted that packaged commodities intended for retail sale are ordinarily assessed on declared retail sale price, while goods supplied to institutional buyers may not require affixation of retail sale price and may fall for valuation under section 4 of the Central Excise Act, 1944. However, the show cause notice did not specifically allege that duty ought to have been paid under section 4 on transaction value for institutional clearances. The Tribunal also found that the record did not clearly establish whether the appellant had supplied goods to two distinct classes of consumers and whether duty had been discharged consistently on all clearances. Since these factual aspects needed verification, the merits of the differential duty demand could not be finally determined at that stage.

Conclusion: The impugned orders were set aside and the matter was remanded to the adjudicating authority for fresh consideration, leaving all issues open.

---