SAD exemption and MRP affixation: absence of MRP declaration in import papers alone cannot justify denial of relief.

SAD exemption under Notification No. 21/2012-Cus turns on compliance with the MRP affixation condition on retail packages, not on a declaration of MRP in import documents. The post-clearance audit-based demand was unsustainable because the goods were assessed and cleared on the import declaration made, and no statutory requirement was shown for an MRP declaration in the Bill of Entry. In the absence of proof that the packages fell outside the packaged-commodity regime or otherwise failed the legal MRP condition, denial of the exemption could not rest on assumptions raised after clearance.

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Issues: Whether the denial of the SAD exemption under Notification No. 21/2012-Cus and the consequent demand, based on alleged non-affixation or non-declaration of MRP and verification through post-clearance audit, were sustainable.

Analysis: The goods were assessed and cleared on the declaration made at import. The alleged infirmity was raised later on post-clearance audit on the premise that the packages did not satisfy the MRP-related requirements for claiming the exemption. The legal requirement was found to be affixation of MRP on the retail packages, not declaration of MRP in the Bill of Entry or other import documents. In the absence of any statutory requirement to make such a declaration in the import documents, and where the goods were not shown to be outside the scope of the relevant packaged-commodity regime, the demand could not be sustained merely on assumptions drawn after clearance.

Conclusion: The demand was held unsustainable and the appellant was entitled to the benefit of the exemption notification.

Ratio Decidendi: Where an exemption condition requires affixation of MRP on retail packages, absence of a declaration of MRP in import documents does not by itself justify denial of the exemption or a post-clearance demand unless non-compliance is otherwise established in law.

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