Central Excise - Pan Masala - Applicability of Notification No. 27/97-C.E., dated 7-5-1997 and 16/98-C.E. (N.T.), dated 2-6-1998 - Regarding - Central Excise - F. No. 332/13/97-TRU

F. No. 332/13/97-TRU Dated 10-1-2000 Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Central Excise - Pan Masala - Applicability of Notification No. 27/97-C.E., dated 7-5-1997 and 16/98-C.E. (N.T.), dated 2-6-1998 - Regarding. I am directed to say that some doubts have been expressed with regard to the interpretation of Notification No. 16/98-C.E. (N.T.), dated 2-6-1998 and Notification No. 27/97-C.E., dated 7-5-1997. The doubts have been expressed in the context of the fact that pan masala in retail packages of quantity not exceeding 4 gms. per pack is covered by both these notifications and therefore, a question has been raised whether the excise duty is to be charged or the basis of tariff value fixed under Notification No. 16/98-C.E. (N.T.) or the assessment has to be made under Notification No. 27/97-C.E. In this context it is clarified that the purpose of Notification No. 16/98-C.E. (N.T.) is to fix the tariff values for pan masala packed in packages of less than 10 gm. On this basis, the assessable value of pan masala packed in retail packages containing quantity not exceeding 2 gms. per pack has been fixed at Re. 1.00 per unit pack. Higher tariff values have been fixed for packages containing more than 2 gms. of pan masala per pack. It was, however, represented to the Government that comparatively cheaper varieties of pan masala packed in packages and containing quantity not exceeding 2 gms. per pack or quantity not exceeding 4 gms. per pack are sold at low retail prices. The assessment of such brands at tariff value fixed under Notification No. 16/98-C.E. would result into high incidence of excise duty per pack. Notification No. 29/97-C.E. seeks to adopt 50% of the MRP fixed on such packages at the assessable value for assessment to duty. In view of the position explained above, if any packages of pan masala satisfy the/condition regarding the quantity contained per pack as also the condition regarding the ceiling of maximum retail price as specified in Notification No. 27/97-C.E. the benefit of assessment wider than this Notification cannot be denied to such packages. It is not correct to take a view that the tariff value for such packages is higher and therefore the assessment should be resorted to at higher assessable value under Notification No. 16/98-C.E. (N.T.).