Marketability of captive copper phthalocyanine controlled excisability and prevented its value being counted against exemption eligibility.

Copper phthalocyanine in lump form, captively consumed in dye manufacture, was not shown to have attained marketability or a saleable condition, so it could not be treated as fully manufactured excisable goods merely because it matched the tariff description. The evidence did not show packing in containers or proof that the lump form was capable of sale and purchase in the market. The amended Rules 9 and 49 did not cure that defect, because the central question was whether the product had the character of goods at all. Its value therefore could not be included in aggregate clearances to deny the exemption under Notification No. 44/82.

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Issues: Whether copper phthalocyanine in lump form, captively consumed in the manufacture of other dyes, was dutiable as a fully manufactured excisable product and whether its value could be included for determining eligibility to exemption under Notification No. 44/82.

Analysis: The departmental case proceeded on the assumption that the captively consumed copper phthalocyanine was fully manufactured and answered the tariff description. The evidence on record, however, did not show that the material in lump form had been packed in containers or had attained a marketable stage. Marketability remained essential to treat the product as excisable goods, and there was no material to establish that the lump form was capable of sale and purchase in the market. Mere satisfaction of the tariff description was therefore insufficient. The reliance placed on the amended Rules 9 and 49 did not assist the Department, because the controversy was not merely one of deemed removal but of whether the product had attained the character of goods. In these circumstances, inclusion of the captively consumed quantity in the aggregate clearances for denying the exemption was not justified.

Conclusion: The captively consumed copper phthalocyanine in lump form was not shown to be a marketable fully manufactured excisable product, and its value could not be included for denying the benefit of Notification No. 44/82.

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