Declared package price governs excise exemption; authorities cannot substitute a notional retail price absent express notification authority.

A fiscal exemption notification tied excise duty to the price declared on cigarette packets. The stated legal point is that, where the notification uses the declared package price as the basis of levy, authorities must apply that price according to its plain terms and cannot substitute an assessed, effective, or reasonable price unless the notification itself permits such scrutiny. The text also notes that res judicata must be specifically pleaded in the proceedings below and was not available when raised for the first time at the appellate stage. The declared printed MRP was treated as the operative sale price for the levy.

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Issues: (i) Whether the plea of res judicata could be raised for the first time at the appellate stage to bar examination of the notification issue; (ii) Whether excise duty under the exemption notifications had to be computed on the printed maximum retail price declared on cigarette packets, or whether the Revenue could go behind that declaration and substitute an alleged effective or reasonable price.

Issue (i): Whether the plea of res judicata could be raised for the first time at the appellate stage to bar examination of the notification issue.

Analysis: The principle of res judicata must be specifically pleaded and founded in the proceedings below. The record showed that the Revenue had not taken that plea before the adjudicating authority or the Tribunal, and had in fact proceeded on the footing that the High Court decision was not binding. In those circumstances, the appellate Court declined to entertain the plea.

Conclusion: The plea of res judicata was not available to the Revenue.

Issue (ii): Whether excise duty under the exemption notifications had to be computed on the printed maximum retail price declared on cigarette packets, or whether the Revenue could go behind that declaration and substitute an alleged effective or reasonable price.

Analysis: The notifications fixed the basis of exemption with reference to the sale price declared on the package, read with the statutory regime governing packaged commodities. The expressions used in the notifications were construed according to their plain language, and the printed declaration was treated as the operative basis for levy. The Court rejected the view that the Excise authorities could enquire into the truth, reasonableness, or likely retail realisation of the printed price, since that would rewrite the notification and reintroduce the very uncertainty the scheme was designed to eliminate.

Conclusion: The printed MRP declared on the cigarette packets was the relevant sale price, and the Revenue could not go behind it to substitute another price.

Final Conclusion: The notification-based levy had to be worked out on the declared printed price, the Revenue's contrary approach failed, and the assessee was entitled to relief.

Ratio Decidendi: Where a fiscal exemption notification fixes duty reference to the price declared on the package, the authorities must apply that declared price according to its plain terms and cannot substitute an assessed or notional price by enquiring into its correctness or adequacy, unless the notification itself authorises such scrutiny.

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