Manufacture and marketability govern excise liability, but a delayed demand can still fail on limitation.

Steel structurals fabricated from market-purchased material, using labour and electricity in the factory, were treated as manufactured and marketable goods falling under the tariff entry for structures and parts of structures, making them liable to central excise duty. However, a demand issued in 1993 for goods fabricated during January to June 1988 was held to be beyond the permissible limitation period, so the duty demand and penalty were deleted despite the goods being regarded as excisable. The discussion states that exigibility depends on manufacture and marketability, while delayed demands remain unenforceable if time-barred.

---

---

Issues: (i) whether the steel structurals used for the shed were classifiable as excisable goods under Chapter Heading 7308.90 and liable to central excise duty; (ii) whether the demand raised in 1993 for goods fabricated during January 1988 to June 1988 was barred by limitation.

Issue (i): whether the steel structurals used for the shed were classifiable as excisable goods under Chapter Heading 7308.90 and liable to central excise duty

Analysis: The goods were fabricated from market-purchased raw material, using labour services and electricity from the factory connection. The findings recorded that the structurals came into existence through a manufacturing process and were capable of being marketed. On that basis, the goods answered the requirements of identifiable manufactured goods and fell within the tariff entry for structures and parts of structures.

Conclusion: The issue was decided against the assessee and the goods were held liable to central excise duty.

Issue (ii): whether the demand raised in 1993 for goods fabricated during January 1988 to June 1988 was barred by limitation

Analysis: The show cause notice was issued more than five years after the relevant period of manufacture. In the absence of a sustainable basis to sustain the delayed demand, the claim was held to be outside the permissible period.

Conclusion: The issue was decided in favour of the assessee and the demand was held to be time-barred.

Final Conclusion: The appeal succeeded on limitation, resulting in deletion of the duty demand and penalty, even though the goods were found to be excisable.

Ratio Decidendi: Steel structurals are exigible to duty only if they are manufactured, identifiable goods with marketability, but a demand raised beyond the permissible limitation period cannot be sustained.

---