Excisability of rags from worn clothing turned on manufacture and marketability, not on a specific tariff description.

Excisability depends on manufacture and marketability, and goods need not be specifically named in the tariff to be regarded as excisable; they may still fall under the nearest appropriate heading. On that basis, rags emerging from imported worn clothing could not be denied exemption merely because they were not expressly described in the tariff, where the process was accepted as manufacture and the goods were treated as marketable. The appellant therefore made out a prima facie case for unconditional stay.

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Issues: Whether the appellant had made out a prima facie case for unconditional stay by showing that the rags emerging from the imported worn clothing were excisable goods for the purpose of the exemption notification.

Analysis: The inputs were imported under Notification No. 52/2003, and the exemption depended on the goods being used in the manufacture of finished excisable goods. The adjudicating authority had accepted that the process amounted to manufacture and that the rags were marketable, but denied the benefit only because the rags were not specifically named in the tariff. The Tribunal held that excisability depends on manufacture and marketability, and that absence of a specific tariff entry does not by itself make goods non-excisable; goods not specifically described may still be classifiable under the nearest appropriate heading.

Conclusion: The appellant established a prima facie case, and unconditional stay was justified.

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