Excise duty on blended wool tops is leviable at final clearance, not at the intermediate blending stage.

Central excise duty on wool tops is chargeable on removal of the excisable commodity at the stage of final clearance, not when pure wool tops are taken for blending. The blending process did not create a new product; the wool tops and blended wool tops remained the same excisable commodity under the tariff entry. Because the processing was part of a continuous manufacturing sequence, the earliest-stage theory of levy had no basis under the Central Excise Rules. Duty was therefore assessable on the weight of the wool tops at final clearance, and not at the intermediate blending stage.

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Issues: Whether central excise duty on blended wool tops was payable at the stage of removal of the pure wool tops for blending, or only at the stage of final clearance of the blended wool tops.

Analysis: The wool tops and the blended wool tops remained the same excisable commodity under the relevant tariff entry, and the blending process did not bring into existence a different product. The removal of pure wool tops for blending was part of a continuous manufacturing process and did not justify applying an earlier stage for levy merely because further processing followed. The Tribunal also applied its earlier view that duty is chargeable on removal of excisable goods and that the earliest stage theory has no basis under the Central Excise Rules.

Conclusion: Duty was correctly assessable at the time of final clearance of the wool tops on the basis of their weight at that stage, and not at the stage when pure wool tops were taken for blending.

Ratio Decidendi: Excise duty is chargeable on removal of the excisable commodity as it exists at the time of clearance, and a captive-use or intermediate processing stage does not create an earlier levy point unless the process results in a different commodity.

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