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????

AI Summary

Excise Duty Valuation: Use Area-Specific MRP or Higher MRP When Dual Pricing Exists on Products A client manufacturing ice creams transfers goods to a warehouse, paying excise duty at the time of removal. Products display two MRPs: one for Karnataka and another for the rest of India, with the Karnataka MRP being lower. The query concerns which MRP to use for excise valuation. Replies suggest using each retail price as per the area of sale, supported by case laws such as Gujarat Goldcoin Ceramics and Bell Granito Ceramics. If two MRPs are on a single product, the higher should be used. The discussion highlights the legal intricacies of excise duty valuation based on MRP.