Marketability as a of excisability defeats duty on unstable fermentation broth and culture media under central excise law.

Marketability is an essential ingredient of excisability under central excise law, and a product must be a distinct, identifiable commodity known in the market before duty can attach. Neutralised fermentation broth described as calcium citrate was found to be a heterogeneous, unstable and unmarketable intermediate, so it was not excisable. Culture media was also held outside Heading 38.21 because the entry covers prepared, marketable culture media in a recognised form, whereas the product was treated as an unstable impure solution containing developed bacteria and not a qualifying preparation. The Revenue's case failed on both counts.

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Issues: (i) whether neutralised fermentation broth, described as calcium citrate, was excisable goods in the absence of marketability; (ii) whether culture media was excisable under Heading 38.21 of the Central Excise Tariff.

Issue (i): whether neutralised fermentation broth, described as calcium citrate, was excisable goods in the absence of marketability.

Analysis: The sample was found to be a heterogeneous mixture containing only a percentage of calcium citrate and was treated as neutralised fermentation broth rather than pure calcium citrate. The product was found to be unstable, liable to deterioration, and without shelf life. The governing test applied was that excise duty attaches only to goods that are known in the market as a distinct and identifiable commodity, and marketability is an essential ingredient of excisability.

Conclusion: The product was not excisable and the finding was against the Revenue.

Issue (ii): whether culture media was excisable under Heading 38.21 of the Central Excise Tariff.

Analysis: Heading 38.21 covers prepared culture media for development of micro-organisms, and the explanatory note indicates that the product must be a prepared and marketable culture medium in a recognised form. On the facts, the product was treated as an unstable, impure solution containing developed bacteria rather than a preparation for growing micro-organisms, and it was also found to be unmarketable. The tariff entry was therefore not attracted.

Conclusion: The product was not excisable and the finding was against the Revenue.

Final Conclusion: The appeal by the Revenue failed because both products were held to be non-excisable for want of marketability and tariff coverage.

Ratio Decidendi: For central excise, goods must be distinct and marketable commodities; an unstable or unmarketable intermediate product does not become excisable merely because it is produced in manufacture or can be fitted into a tariff description in the abstract.

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