Rule 196 compliance and unchanged essential character upheld duty demand for unauthorised removal of solvent goods.

Removal of benzene and toluene from licence premises without prior Central Excise permission was contrary to Rule 196, so the duty demand was sustained. Compliance with the Bombay Prohibition Act did not excuse removal without first obtaining excise authority approval. A later notification issued in 1980 could not be relied on for a removal that occurred in 1974 because it was not then in force. The argument that processing had changed the goods so they were no longer toluene was rejected, as the essential character of the goods remained unchanged.

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Issues: Whether removal of benzene and toluene from the licence premises without prior permission violated Rule 196 of the Central Excise Rules, and whether Notification No. 125 of 80 dated 2-8-1980 could be relied upon for a removal made in 1974.

Analysis: The removal of goods admittedly took place otherwise than in the manner permitted by Rule 196. If compliance with the Bombay Prohibition Act required goods to be sent out, the proper course was to obtain the Central Excise authorities' permission before removal. The notification issued on 2-8-1980 could not assist the appellants because it was not in force when the removal occurred. The plea that the goods ceased to be toluene after processing was rejected, as processing did not change the essential character of the goods.

Conclusion: The removal was in breach of Rule 196, the later notification had no application, and the challenge to the duty demand failed.

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