Open market under excise exemption notification means general commercial availability, so unrestricted purchases qualified for exemption.

Notification No. 4/68-C.E. made excise exemption conditional on duty having been paid on the surface active agents used as raw material, or on those agents being purchased from the open market after 20 January 1968. The prior-payment condition did not apply because the raw material had been bought from a manufacturer whose production was already exempt. The phrase "open market" was held to mean a general commercial market open to all willing purchasers, not a physical bazaar or market-place. As the supplier sold to all customers without restriction, the purchases qualified as open market purchases and the excise exemption was available.

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Issues: Whether the appellant was entitled to exemption from excise duty under Notification No. 4/68-C.E. dated 20 January 1968 on emulsifiers and wetting out agents manufactured from surface active agents purchased after 20 January 1968, and whether such purchases were from the "open market" within the meaning of the notification.

Analysis: The notification made exemption contingent on either prior payment of duty on the surface active agents used as raw material or purchase of those agents from the open market on or after 20 January 1968. The prior-payment condition had no application because the raw material had been bought from a manufacturer whose production was exempt from duty. The decisive question was therefore the meaning of "open market". The expression was held not to be confined to a physical bazaar or market-place, but to cover commercial purchases available to all persons willing to place orders and obtain supply on the same terms. On the facts, the supplier sold to all customers without restriction to a limited class, so the purchases were from the open market.

Conclusion: The appellant satisfied the notification condition and was entitled to the excise exemption; the demand and the orders of the departmental authorities were unsustainable.

Ratio Decidendi: For exemption notifications using the expression "open market", the term denotes a general commercial market open to all potential purchasers, not merely a physical market-place, and purchases from a manufacturer selling generally to all comers qualify as purchases from the open market.

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