Marketability and RG-1 compliance turn on final packed goods; penalties fail absent proof of finished goods or clandestine removal.

Submersible winding wires remained in the course of manufacture while undergoing testing and final packing, and were not marketable until the prescribed tests were completed and the ISI mark affixed. RG-1 entries were not required merely because the goods had reached an intermediate stage during the day; the register was to reflect the day's production at the end of the working day. As the officers did not establish the existence of fully packed marketable goods at inspection, and no clandestine removal was found, confiscation, redemption fine, and penalty were unsustainable.

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Issues: Whether submersible winding wires still undergoing testing and final packing were marketable goods required to be entered in the RG-1 register and whether confiscation, redemption fine, and penalty were sustainable for alleged non-maintenance of the register.

Analysis: The goods were under a prolonged testing process and became marketable only after completion of the prescribed tests and affixation of the ISI mark. Entries in RG-1 were not required at the moment goods first reached an intermediate stage during the day, but only for the day's production at the end of the working day. On the facts found, the visiting officers did not establish that fully packed marketable goods existed when the factory was inspected, and there was no finding of clandestine removal.

Conclusion: The goods were not liable to be treated as fully manufactured marketable goods at the time of inspection, and the confiscation, redemption fine, and penalty were unsustainable.

Final Conclusion: The orders of the lower authorities were set aside and the assessee's challenge succeeded in full.

Ratio Decidendi: Goods remain in the course of manufacture until they become marketable in their final packed form, and penal consequences for non-entry in RG-1 cannot be sustained absent proof of fully manufactured goods or clandestine removal.

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