MRP valuation cannot apply to exempt small shampoo sachets; assessable value must be determined under transaction value.

Shampoo sachets containing 10 ml or less were exempt under the relevant packaged commodities metrology rules from declaring retail sale price, so MRP-based valuation under Section 4A of the Central Excise Act, 1944 could not apply merely because the goods were notified. The applicable assessable value was therefore required to be determined under Section 4 on transaction value. The demand based on Section 4A valuation was held unsustainable, following the Tribunal's earlier reasoning on similar small-quantity shampoo sachets.

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Issues: Whether the assessable value of shampoo sachets/pouches containing 10 ml or less was required to be determined under Section 4A of the Central Excise Act, 1944 on the basis of MRP, or under Section 4 of that Act on transaction value.

Analysis: The sachets in question contained liquid shampoo in predetermined quantity by weight/volume. Under Rule 34 of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977, and later Rule 26(a) of the Legal Metrology (Packaged Commodities) Rules, 2011, packs of the prescribed small quantity were exempt from the requirement of declaration of retail sale price. The settled principle applied was that mere notification of goods under Section 4A is not enough for MRP-based valuation unless there is a statutory requirement to declare retail price on the package. The earlier decision in the appellant's own case and the Tribunal's reasoning on similar shampoo sachets were followed.

Conclusion: The valuation had to be made under Section 4 of the Central Excise Act, 1944 and not under Section 4A. The demand based on MRP valuation was unsustainable and the appellant succeeded.

Ratio Decidendi: Where packaged goods of small quantity are exempt under the relevant weight-based metrology rules from displaying retail sale price, Section 4A valuation cannot be applied merely because the goods are notified, and assessment must proceed under Section 4 on transaction value.

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