Valuation of excise if different MRP's printed

[VAMSI KRISHNA]

Dear All,

Our Client engagged in manufacture of ice creams. HSN num 21050000.

They are producing finished goods in unit A and entire produced goods are transferred to warehouse by paying duty (Since date of remonal is taxable event in excise). While paying duty they are unaware that where it is going to be sold. They store goods in warehouse and based on orders they supply to different places in india. But every product bears two MRP's like 'if sold in Karnataka' and 'Rest of india'. They discharging duty based on MRP 'If sold in Karnataka'. the MRP of karnataka is always less than the MRP if sold rest of india.

As per the provisions of excise act When different retail sale prices are declared on different packages, each such retail price shall be the ‘retail sale price’ for purposes of valuation of excisable goods intended to be sold in area to which the retail price relates – [Explanation 2(c) to Section 4A(4)].

Now my question is what MRP they should consider for the purpose of valuation of excise ????

Kindly mentioned relevent case laws and judgements????

[KASTURI SETHI]

Sh.Vamsi Krishna Ji,

Why are you not satisfied with 'each such retail price' ? Go through the following case laws:-

1. 2008(223)ELT/556(CESTAT) = 2008 (1) TMI 65 - CESTAT, AHMEDABAD Gujarat Goldcoin Ceramics

2. 2009 (235)ELT/171 =  2008 (11) TMI 99 - CESTAT, AHMEDABAD CESTAT Bell Granito Ceramics

There are so many judgements on the issue. On the basis of these case laws, so many cases have been decided in favour of assessees.

[Ganeshan Kalyani]

I have gone through the case laws. They are very useful to fight the case where different MRP is mentioned on different product sold in different States . The law does not provides that the location where the goods are to be sold to be mentioned on the packing of the goods. If separate MRP is mentioned on separate product then each such price is MRP. And if two MRP is mentioned on single product then maximum of both shall be the MRP .

Thanks Sri Kasturi Sir for enriching knowledge by sharing the case law. Thanks .

[KASTURI SETHI]

Sh.Kalyani Ji,

You have also gone to the root of the problem.

[Ganeshan Kalyani]

Yes Sir , the issue is very interesting . Thanks.

AI Summary

Retail sale price as MRP: when different MRPs are printed, each price governs valuation for its sales area. Each declared retail price printed on packaging is the retail sale price for valuation of excisable goods intended to be sold in the area to which that price relates; separate MRPs on separate packages each govern valuation for those packages, and if two MRPs appear on a single package the higher printed price is treated as the applicable MRP.