Captive consumption and marketability govern duty on electric motors used in monoblock pump manufacture.

Electric motors captively used in the manufacture of monoblock pumps were treated as not separately chargeable to duty because the motor did not emerge as an identifiable marketable article. The Tribunal applied the principle that captive consumption can attract duty only where marketability is established, and it relied on its earlier view that rotors and stators used in pump manufacture do not result in a distinct excisable product. On that basis, the duty demand was found unsustainable.

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Issues: Whether electric motors captively used in the manufacture of monoblock pumps were liable to duty, and whether marketability was required to be established for such levy.

Analysis: The Tribunal followed its earlier view that rotors and stators are used in the manufacture of monoblock pumps and that the electric motor does not come into existence as an identifiable article. It also relied on the principle that duty on goods captively consumed can be sustained only if marketability is established.

Conclusion: The electric motors captively used in the manufacture of monoblock pumps were not liable to duty in the absence of marketability, and the demand was unsustainable.

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