Marketability in excise law bars duty on broken goods damaged before completion and not ready for sale.

Broken and scrapped cement poles damaged during manufacture before reaching completion and marketability were held not to be excisable goods. Goods that have not become fully manufactured and ready for delivery or marketing cannot attract central excise duty merely because the broken pieces may later have incidental use or residual value. The distinction drawn from prior decisions was that those cases involved fully manufactured goods subjected to testing or separately marketable scrap, whereas here the products never attained the stage of marketable completion. The duty demand was therefore set aside and the Revenue's appeal failed.

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Issues: Whether broken and scrapped cement poles, damaged during manufacture before becoming marketable, were liable to central excise duty as excisable goods.

Analysis: The defective poles developed cracks and bends during the manufacturing process and were broken and scrapped before reaching the stage of completion and marketability. Goods that have not become fully manufactured and ready for delivery or marketing cannot be treated as excisable merely because the broken pieces may later be put to some incidental use or may have some residual value. Prior decisions dealing with fully manufactured goods subjected to test or with a separately marketable scrap product were distinguished on that basis.

Conclusion: The broken poles were not excisable goods liable to duty, and the Revenue's appeal failed.

Final Conclusion: The order setting aside the duty demand was affirmed and the appeal was dismissed.

Ratio Decidendi: Goods damaged in the course of manufacture before they attain the stage of marketability and full manufacture are not liable to excise duty as excisable goods.

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