MRP based excise

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sanjay rastogi (Querist)
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06 July 2009 We manufacture an electrical product which falls under MRP based valuation. For contract manufacturing for a BRAND, we pay excise duty based on Brand's MRP.

Some brand now advises us that we can print the brand and mark ISI but dont pack it, but despatch it as a wholesale pack. They would pack it and release it in their dealer market after paying MRP based excise. I.e. we are sending unpacked branded good ISI marked.

AND they want us to bill it and charge excise at transaction value and not on MRP-abatement.They would take the CENVAT, pack it and charge excise based on their MRP. They wish to show MANUFACTURING at their for some purpose.

The question is CAN WE charge excise from them at transaction value?? if we are selling brand printed but in unpacked condition in wholesale packing(so unsuitable for direct retailing and hence would not attract MRP based valuation acc. to Weights and Measures Sec 4). i understand there is reference case - VISHVAM supplying to CANON industries, Ernakulum.

Thanks for your cooperation and advice.

ADITYA

ADITYA (Expert)
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27 July 2009 "Some brand now advises us that we can print the brand and mark ISI but dont pack it, but despatch it as a wholesale pack"

You yourself answered your query as you are putting ISI & BRAND MARK on the product, the standard mode of packaging of any Branded Good may differ or changed at any time as per the policy of the company or Market Forces, but it can not be termed that un-packed or whole-sale packed goods are not Branded.

sanjay rastogi

sanjay rastogi (Querist)
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10 August 2009 thanks, but the question is DO WE CHARGE EXCISE ON TRANSACTION VALUE OR mrp based VALUE.