1988 (12) TMI 182 - AT - Central Excise

Tribunal allows delay in filing appeals, exempts duty on destroyed goods.

The Tribunal condoned the delay in filing Supplementary Appeals by the Department as the main appeal was filed within the prescribed time limit and the ... Manufacture when completes The appeals concerned whether Central Excise duty was payable on about one percent of cement concrete poles destroyed during mandatory quality-control testing. The Department argued the poles were 'fully manufactured', accounted in RG-1 and placed in bonded storage, so removal for testing amounted to in-factory 'utilisation' liable to duty absent an exemption notification. The Tribunal rejected this view, noting the poles were produced under contract and could be delivered only after passing prescribed tests; approximately one percent were selected and destroyed during testing. The court held the goods became 'marketable and fit for delivery only after they had passed the prescribed quality control tests' and that 'unless the goods reach a stage where they are fit for delivery, they cannot be considered as fully manufactured goods.' The necessity for an exemption notification arises only after goods are fully manufactured and thereafter utilised; here testing occurred prior to that stage. All seven appeals were dismissed.