Site-specific RCC bridge components may escape excise duty when not marketable and used only for the construction site.

Pre-cast RCC box segments and RCC slabs made to railway-specific design for bridge construction were treated as non-marketable when they were fabricated only for use at the site, became part of the bridge on assembly, and were not shown to be goods known to the commercial market; on that reasoning, no central excise duty was attracted. The same site-bound manufacture and exclusive use also satisfied the exemption conditions under Notification No. 59/90-C.E., because the goods were produced at the construction site for that very work. The commentary further notes that, on these merits, the demand and penalty could not be sustained.

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Issues: (i) Whether the pre-cast RCC box segments and RCC slabs manufactured for railway bridge construction were marketable excisable goods. (ii) Whether the goods were entitled to exemption under Notification No. 59/90-C.E. dated 20-3-1990.

Issue (i): Whether the pre-cast RCC box segments and RCC slabs manufactured for railway bridge construction were marketable excisable goods.

Analysis: The goods were fabricated to the Railways' specific design and specifications for use only in the construction of minor bridges at the site. They were not standard commodities bought and sold in the market, could not be used elsewhere, and became part of the bridge and thus part of immovable property on assembly. The burden to establish marketability was not discharged by the department, and the materials did not answer the description of goods liable to central excise duty.

Conclusion: The goods were not marketable excisable goods and were not liable to central excise duty.

Issue (ii): Whether the goods were entitled to exemption under Notification No. 59/90-C.E. dated 20-3-1990.

Analysis: The notification exempted goods manufactured at the site of construction for use at that site. The board's clarification also indicated that the expression "site" should receive a broad meaning where the premises were made available under the construction contract and the goods were used solely for that work. As the goods were manufactured at the railway site and used only for the contracted bridge work, the notification conditions were satisfied.

Conclusion: The goods were eligible for exemption under Notification No. 59/90-C.E. dated 20-3-1990.

Final Conclusion: The demand and penalty could not be sustained on the merits, and the assessee's appeal succeeded while the Revenue's appeal failed.

Ratio Decidendi: For central excise, goods manufactured to a special site-specific design are not dutiable unless they are shown to be marketable as goods known to the commercial community, and site-based exemption applies where the manufacture and use are confined to the construction site covered by the notification.

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