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• DUARTE v. COMMISSIONER OF REVENUE 

CORDY, J. The Commissioner of Revenue (commissioner) appeals from an Appellate Tax Board (board) decision vacating the suspension of a retailer's license to sell cigarettes and declaring the "Fair Pricing of Cigarettes" regulation, 830 Code Mass. Regs. § 64C.14.1 (1993) (§ 64C.14.1), "invalid on its face as inconsistent with the provisions of G. L. c. 64C and the decision of the Supreme Judicial Court in Commissioner of Corps. & Taxation v. Ryan, 323 Mass. 154 (1948)." We affirm the board's decision vacating the retailer's suspension, albeit on different grounds. We also conclude that the board did not have the authority to declare the regulation in question invalid. . . .

3. Conclusion. The board's ruling that § 64C.14.1, in its entirety, was invalid on its face and of no legal effect, is vacated. Further, although we conclude that the presumptive pricing framework set forth in the regulation, § 64C.14.1(1)-(4), (7)-(11), is rationally related to the enforcement of G. L. c. 64C, §§ 12-21, a licensed retailer like Duarte must be afforded an opportunity to demonstrate that he has sold cigarettes "at a price made in good faith to meet the prices of a competitor," G. L. c. 64C, § 16, before his license can be suspended. To the extent that the hearing regulation set forth in § 64C.14.1(5) and (6), foreclosed Duarte's opportunity to make such a showing, they are inconsistent with the statute and due process. Finally, the board's determination that Duarte set his prices in a good faith effort to meet the prices charged by competitors and that his license should therefore not be suspended is supported by substantial evidence and is affirmed.

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