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CMA Final · Indirect Tax Laws and Practice · Valuation under GST

A package of cigarettes bears two retail sale prices, Rs 240 and Rs 270, declared on it. As per Rule 31D, the retail sale price to be used for valuation is:

Rs 270 is used. Where a package of specified goods shows more than one retail sale price, Rule 31D deems the maximum of those prices to be the retail sale price, from which applicable tax is then deducted to arrive at the value.

  1. ARs 240, the lower price
  2. BRs 255, the average of the two
  3. CRs 270, the maximum priceCorrect
  4. DRs 510, the sum of both prices

Explanation

Explanation (c) to Rule 31D provides that where more than one retail sale price is declared on the package, the maximum of such prices is deemed to be the retail sale price. So Rs 270 is used, before deducting tax.

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