Excise duty on partially oriented yarn had to be paid before removal, not deferred until texturisation.

Partially oriented yarn was treated as an excisable product with a distinct commercial identity and marketability, so it fell within the relevant tariff item and could not be treated as semi-finished goods for Rule 56-B purposes. The original permission under that rule was expressly temporary, and the excise authority could withdraw it when the factual basis for grant ceased. The amended Rules 9 and 49, read with the validating effect of the Finance Act, 1982, required duty to be paid before removal for texturisation, so duty could not be deferred until that stage.

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Issues: Whether Partially Oriented Yarn was semi-finished goods eligible for removal under Rule 56-B of the Central Excise Rules, whether the original permission granted under that rule was permanent or could be withdrawn, and whether central excise duty could be deferred till texturisation.

Analysis: The charging provision under Section 3 of the Central Excises and Salt Act, 1944 covers excisable goods manufactured in India, and the term "goods" bears its ordinary meaning of articles known to the market and capable of being bought and sold. The Court held that Partially Oriented Yarn had a distinct commercial identity, was marketable, and fell within Tariff Item No. 18(II)(i)(a) of the First Schedule. The doctrine of common parlance did not assist the petitioner because the goods were already classified and duty was in fact being paid on them. Rule 56-B applied only to excisable goods in the nature of semi-finished goods, and Partially Oriented Yarn was not such goods. The original permission was expressly temporary, and the authority had implied power to withdraw it when the factual basis for the grant was found to be . The amended Rules 9 and 49, together with the validating effect of the Finance Act, 1982, required duty to be discharged before removal for texturisation.

Conclusion: The permission under Rule 56-B was not permanent, Partially Oriented Yarn was not semi-finished goods, and duty was not deferrable till texturisation. The challenge to the cancellation of permission failed.

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