Circular No. 411/44/98-CX, dated the 31st July, 1998

F.No.103/1/98-CX.3
Subject: Charging of excise duty with reference to maximum Retail Price -regarding

I am directed to say that doubts have been raised as regards charging of excise duty with reference to maximum retail price under section 4A of Central Excise Act, 1944 in cases where MRP is not required to be affixed on packings, as a statutory requirement under the Standards Weights and Measures Act or any other Law for the time being in force, even though some manufacturers may voluntarily be affixing the MRP on such packings.

2. Instructions were issued by the Board"s vide letter F.No. 341/64/97- TRU dated 11th August, 1997 clarifying that Sub-section (1) of Section 4A applies only when the MRP is required to be indicated under the provisions of Standards Weights and Measures Act, 1976 or under any other Jaw for the time being in force. In other words, Section 4A applies only when there is statutory requirement of affixing the MAP. Accordingly, in case a manufacturer voluntarily affixes MRP which is not statutorily required then the excise duty on goods in such packings shall not be charged on the basis of Section 4A of the Central Excise Act, 1944.

3. The Commissioners of Central Excise may however require the manufacturers to intimate and declare to the jurisdictional Assistant Commissioner of Central Excise as regards the packings on which MRP is not required to be affixed statutorily may be asked to indicate full description including weight etc. of such packings. It may be examined and ensured by the Assistant Commissioner that the packings are such that they are exempt under the provisions of the Standards Weights and Measures Act and the rules made thereunder. Such packings will be assessed to excise duty under the provisions of Section 4 of Central Excise Act, 1944.

4. The matter has been re-examined and it has been decided to reiterate the above instruction contained in Board"s letter F.No. 341/64/97. TRU dated 11th August, 1997. Accordingly, the instructions dated 30.4.98 regarding Shampoo sachets communicated to Chief Commissioner, Vadodara and some assessees may be treated to have been withdrawn. Such cases may also be decided in accordance with the instructions contained in this Circular.

5. All pending disputes/assessments on the issue may be settled in the light of these guidelines.

Sd/-
(Renu K. Jagdev)
Under Secretary to the Government of India

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