Per Dr. Chittaranjan Satapathy:

This Bench has been constituted to reconsider the earlier decision of the Tribunal in the case of CCE, Daman Vs. Kraftech Products Inc. - 2005 (66) RLT 346 (CESTAT-Del)=2004 (174) ELT 396 (Tri.-Del) in view of the majority order in this case opining that such a reconsideration is necessary in the light of decision of the Honourable High Court of Madras in the case of Varnica Herbs vs. C.B.E. C, New Delhi - 2004 (163) ELT 160 (Mad.) We have heard both sides at length.

2. The dispute relates to method of valuation applicable to the impugned goods, namely 'Godrej' brand hair dye in pack of 3 sachets of 3 gms each. It is the contention of Revenue that such packs are required to be valued on the basis of maximum retail price (MRP) under section 4A of the Central Excise Act, 1944 (CEA) whereas respondents argue that they have correctly valued the goods under section 4 of CEA as section 4A does not apply to such goods.

3. Section 4A of CEA reads as under:-

"SECTION 4A. Valuation of Excisable goods with reference to retail sale price.- (1) The Central Government may, by notification in the official Gazette, specify any goods, in relation to which it is required, under the provisions of the Standards of Weights and Measures Act, 1976 (60 of 1976) or the rules made thereunder or under any other law for the time being in force, to declare on the package thereof the retail sale price of such goods, to which the provisions of sub- section (2) shall apply.

(2) Where the goods specified under sub-section (1) are excisable goods and are chargeable to duty of excise with reference to value, then, notwithstanding anything contained in section 4, such value shall be deemed to be the retail sale price declared on such goods less such amount of abatement, if any, from such retail sale price as the Central Government may allow by notification in the Official Gazette.

(3) The Central Government may, for the purpose of allowing any abatement under sub-section (2), take into account the amount of duty of excise sales tax and other taxes, if any, payable on such goods.

Explanation 1: For the purpose of this section, 'retail sale price' means the maximum price at which the excisable goods in packaged from may be sold to the ultimate consumer and includes all taxes local or otherwise, freight, transport, charges, commission payable to dealers, and all charges towards advertisement, delivery packing, forwarding and the like as the case may be and the price is the sole consideration for such sale.

Explanation 2. Where on any excisable goods more than one retail sale price is declared, the maximum of such retails sale price shall be deemed to be the retail sale price for the purposes of this section."

4. It is clear from the above that for section 4A to apply:-

(i) The goods must be specified in a notification, and

(ii) In relation to such goods there must be a legal requirement to declare the retail sale price on the package under the provisions of the Standard of Weights and Measures Act, 1976 (SWMA) or rules made thereunder or under any other law.

5. It is not in dispute that the impugned goods have been specified under a notification. The dispute relates to whether there is a legal requirement to declare the retail sale price on the package of the impugned goods. The respondents claim that the impugned goods being less than 10 gms by weight are exempted from such requirement under Rule 34 of the Standards of Weights and Measures (Packaged) Commodity Rules, 1977 (SWMR) which reads as under: -

"34. Exemption in respect of certain packages. (1) Nothing contained in these rules shall apply to any package containing a commodity if-

(a) .......

(b). the net weight or measure of the commodity is ten grams or ten milliliters or less, if sold by weight or measure."

6. We note at this stage that the following earlier decisions of the Tribunal have consistently held similar goods to be eligible for exemption under Rule 34 of SWMR and hence