Marketability test defeats excise duty on in-house fabricated steel racks treated as part of an immovable facility.

Fabricated steel racks and related parts were held not to be marketable goods, so central excise duty was not leviable. The decisive test was marketability: excise applies only to manufactured goods capable of being bought and sold in the market. The articles were made by cutting iron and steel angles, drilling holes, and fitting nuts and bolts for use within the assessee's premises. As they were not generally marketed and were treated as in-house fabrication forming part of an immovable storage facility, classification under Tariff Item 94.03 was not sustainable.

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Issues: Whether the fabricated steel racks and related parts were marketable goods liable to central excise duty and classifiable under Tariff Item 94.03.

Analysis: The fabrication activity consisted of cutting iron and steel angles into different sizes, drilling holes, and fitting nuts and bolts for use in the assessee's premises. The decisive test applied was marketability, because excise duty is leviable only on goods that are manufactured and capable of being bought and sold in the market. On the evidence, the fabricated articles were neither generally marketed nor shown to have been sold by the assessee. The material was treated as an in-house fabrication forming part of an immovable storage facility, not as marketable commercial goods.

Conclusion: The fabricated articles were not goods for excise purposes, and therefore no duty or classification under Tariff Item 94.03 was sustainable in favour of the Revenue.

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