Manufacture and marketability tests barred excise duty on site-fabricated structurals, while binding Tribunal rulings prevailed over conflicting circulars.

Writ petitions remained maintainable despite an alternate appellate remedy because departmental authorities were bound by Board circulars but judicial discipline required the Revenue to follow a binding Tribunal decision unless stayed or reversed; a circular or trade notice could not override that decision. Site fabrication of columns, trusses, girders and similar structurals from duty-paid materials, meant for immediate incorporation into factory sheds or rolling mills, did not amount to manufacture because no new marketable excisable goods came into existence. The fabricated items were treated as part of immovable structures, so no excise duty was leviable and the adjudication orders were unsustainable.

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Issues: (i) Whether the writ petitions should be entertained despite the availability of an appellate remedy under the Central Excises & Salt Act, 1944, in view of the binding effect of departmental circulars and the contrary tribunal decision; (ii) Whether fabrication of structurals at the site from duty-paid materials supplied by the principal amounted to manufacture of excisable goods liable to duty.

Issue (i): Whether the writ petitions should be entertained despite the availability of an appellate remedy under the Central Excises & Salt Act, 1944, in view of the binding effect of departmental circulars and the contrary tribunal decision.

Analysis: The existence of an appeal under Section 35 did not constitute an equally efficacious remedy because the departmental authorities were bound by the Board's circulars under Section 37B, while the assessee could still contest their legality. The Court held that judicial discipline required the Revenue to follow binding decisions of the Tribunal unless stayed or reversed, and that a circular or trade notice could not override such a decision. Where a conflict exists between a circular issued under Section 37B and a binding tribunal judgment, the tribunal judgment must prevail.

Conclusion: The writ petitions were maintainable and the preliminary objection based on alternate remedy failed.

Issue (ii): Whether fabrication of structurals at the site from duty-paid materials supplied by the principal amounted to manufacture of excisable goods liable to duty.

Analysis: Excise duty is attracted only when there is manufacture or production of excisable goods, and the goods must be marketable and capable of being brought to the market. Applying the settled tests of manufacture and marketability, the Court held that site fabrication of columns, trusses, girders and similar structurals from duty-paid inputs, intended for immediate incorporation into factory sheds or rolling mills, did not bring into existence new marketable goods. The fabricated items were part of immovable structures and the activity was only fabrication, not manufacture. The tribunal decision in Aruna Industries was found applicable, while the Revenue's relied-upon decisions were distinguished on facts.

Conclusion: The fabricated structurals were not excisable goods and no duty was leviable.

Final Conclusion: The impugned adjudication orders were unsustainable in law and were quashed, leaving the petitioners entitled to relief in both matters.

Ratio Decidendi: For excise duty, a site-fabrication activity using duty-paid materials does not amount to manufacture unless it results in a new, marketable commodity; and where a binding tribunal decision conflicts with a departmental circular, judicial discipline requires the tribunal decision to be followed by the Revenue.

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