Marketability is essential for excise duty on captive circuit boards used in manufacturing electronic voting machines.

Central excise duty on populated circuit boards depends on whether the article is goods and is marketable or at least capable of being marketed. Where the boards were used only captively in manufacturing electronic voting machines and were found not to be ordinarily bought and sold in the market, the absence of marketability defeated the duty levy. No material was shown to displace that finding or to establish marketability, so the demand could not be sustained.

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Issues: Whether the populated circuit boards used captively in the manufacture of electronic voting machines were excisable goods in the absence of marketability.

Analysis: The deciding factor for levy of central excise duty is whether the article is marketable or at least capable of being marketed. The goods in question were used only for captive consumption in the manufacture of electronic voting machines, and there was a specific finding that they were not goods ordinarily bought and sold in the market. No material was shown to rebut that finding or to establish that the goods had marketability. On that basis, the duty demand could not be sustained.

Conclusion: The issue was decided in favour of the assessee and against the Revenue; the goods were held not exigible to duty for want of marketability.

Ratio Decidendi: Captive consumption alone does not attract excise duty unless the article qualifies as goods and is marketable or capable of being marketed.

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