Query on excise valuation

[Guest]

Our product qualifies under sec 4A for MRP based valuation.My query is can we have multiple MRPs for a same product and pay excise duty based on these respective MRPs? Is there any established case law on this

regds

[MANJUNATH MS]

The issue gets covered under Explanation 2 to Section 4A of the central Excise Act,1944..  If multiple MRPs for same product then the maximum of such retail price shall be deemed to be the RSP.  The said explanation takes care of such exigencies

[Guest]

Thanx for the reply.Can you elaborate this a little.What I understand from the explanation that it applies to packs and not to product.So the excise would be levied on pack wise MRPs and not on entire sales of that particular product.For example

Product  X  for Delhi - MRP 20

Product  X  for Assam - MRP 25

The product here is same but to be sold in different markets.So in first case the excise would be levied on Rs 20 and in second case on Rs.25.

 

regds

[YAGAY andSUN]

You may have different MRPs for different markets. But excise duty will be paid on highest MRPs.

[rajkumar shukla]

KINDLY SEE EXP 2(C) UNDER SEC.4A. DIFFERENT RSPs for different areas are acceptable for the purpose of valuation.

[Vivek Harsh]

your view is correct Mr Nitin kindly refer detrmination of Retail Sale Value Rules2008

[Mahir S]

There are several decisions of the Tribunal taking a view that if different MRPs are not on the same package, the highest of the same cannot be taken for the purpose of assessment under Section 4A.

Hence your contention is correct and you can sell the same goods to Delhi and Assam at different MRPs.

If you need copy of such decisions, do let me know, i am aware of at least 5 judgements on your query. The views expressed by Vivek Harsh are also on the same lines.

[MANJUNATH MS]

The explanation (c)  to Section 4A makes it clear that different Retail price can be fixed in different areas and each such retail price shall be the retail sale price for the purposes of valuation of excisable goods.  Hence, there is no ambiguity.  MRP can be different for different areas and each such price will be the RSP for that area

[Guest]

Hi Naveed

 First of all thanks to you and the team for crisp and quick replies.Request if you can share some case laws with me on this.It'll be a great help.

 

regds

[Mahir S]

Thankx a lot Nitinji.

I have sent a Personal Message (PM), providing details of a case law perfectly suitable to your query.

In case, u need a whole copy of the said judgement, do let me know.

Thanks.

AI Summary

MRP-based valuation: area-specific MRPs may determine excise value, though package-specific treatment can prevent using the highest MRP. The Section 4A MRP-based valuation framework provides that where multiple MRPs attach to the same pack the maximum retail price may be deemed the retail sale price for excise valuation, while an explanatory clause permits different area-specific retail sale prices to be treated as the retail sale price for goods sold in those areas; tribunal decisions cited in the discussion have sometimes refused to apply the highest MRP where different MRPs are not on the same package.