1997 (7) TMI 132 - SC - Central Excise

Supreme Court emphasizes evidence in excise duty decisions, overturns tribunal ruling on Acetylene gas marketability

The Supreme Court set aside the Customs, Excise and Gold (Control) Appellate Tribunal's decision to levy excise duty on Acetylene gas produced during the ... Dutiability - Marketability - 'Goods' Issues:Levy of excise duty on Acetylene gas produced during manufacturing process.Analysis:The appellant, engaged in the manufacture of Calcium Carbide and Acetylene Black, argued that the Acetylene gas produced during the process was not marketable due to impurities and specific conditions required for marketability. The Customs, Excise and Gold (Control) Appellate Tribunal held that the gas was marketable and liable for duty under Tariff Item No. 14H(vi). The appellant challenged this finding, citing a previous case where marketability was a crucial factor in determining excisability. The Supreme Court noted that the Tribunal only considered material from the Departmental representative, disregarding appellant's evidence of excessive impurities making the gas unsafe and unmarketable. Consequently, the Court set aside the Tribunal's judgment and remitted the matter for a fresh finding on the marketability of the Acetylene gas produced by the appellant. The Court emphasized the need to consider all evidence presented by the appellant in determining marketability for excise duty purposes.This case highlights the importance of establishing marketability for excisability under Tariff Item No. 14H(vi). The appellant's argument regarding impurities making the gas unsafe and unmarketable was not adequately considered by the Tribunal, leading to the Supreme Court's decision to remit the matter for a fresh finding. The Court referred to previous judgments emphasizing that goods must be marketable or capable of being marketed to be subject to excise duty. The judgment underscores the requirement for a clear finding on marketability based on all evidence presented, ensuring a fair assessment of excisability. The decision serves as a reminder of the need for a comprehensive evaluation of factors affecting marketability in excise duty cases, balancing the interests of manufacturers and tax authorities.