Captive intermediate goods and double duty: separate levy on aluminium wires was unsustainable where duty was already paid on conductors.

Bare aluminium wires used captively in manufacturing aluminium conductors were held not liable to separate duty where duty had already been paid on the finished conductors under the same tariff heading. The reasoning treated the wires and conductors as materially similar to earlier Tribunal decisions and accepted that, even if the wires were an intermediate product, the department could not levy and retain duty twice on the same tariff entry. The cited notification and proforma credit context supported the view that separate recovery on the captive wires was not permissible, and the demand was therefore unsustainable.

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Issues: Whether bare aluminium wires cleared for captive consumption in the manufacture of aluminium conductors were liable to separate duty when duty had already been paid on the finished conductors.

Analysis: The facts were treated as materially similar to earlier Tribunal decisions dealing with aluminium wires and conductors falling under the same tariff sub-item. The reasoning accepted that even if the wires could be regarded as a distinct intermediate product, the department could not levy and retain duty twice under the same tariff entry when duty had already been recovered at the conductor stage. The earlier decisions were followed, and the cited notification and proforma credit context supported the conclusion that separate recovery on the captive intermediate wires was not permissible.

Conclusion: The demand on the bare aluminium wires was unsustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: Where duty has already been recovered on the final product under the same tariff heading, separate duty cannot again be demanded on the intermediate product used captively in making that final product.

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