Excise duty attaches on removal from the factory, so goods cleared after exemption withdrawal remain dutiable.

Excise duty is attracted on the date goods are removed from the factory, not on the date they are manufactured or produced. On a combined reading of Section 3 and Rules 7, 9 and 9A, the taxable event is actual removal, so goods cleared after withdrawal of an exemption notification remain dutiable even if manufactured earlier. An exemption notification does not stop the goods from being excisable, and a nil assessment does not displace the levy where removal occurs after the withdrawal. Duty was therefore payable on the goods cleared after the exemption was withdrawn.

---

---

Issues: Whether excise duty on goods manufactured before an exemption notification but cleared after its withdrawal is chargeable with reference to the date of manufacture or the date of removal from the factory.

Analysis: The applicable charging scheme treats removal of goods from the place of manufacture as the taxable event. On a combined reading of Section 3 and Rules 7, 9 and 9A, duty liability is determined by the date of actual removal and not by the date of manufacture or production. An exemption notification does not cease the goods to be excisable, and a nil assessment does not alter the levy where the goods are cleared after the relevant notification withdrawing exemption.

Conclusion: Duty was correctly held payable on the goods removed after the withdrawal notification, even though they had been manufactured earlier.

---