Marketability governs excisability of intermediate products, while suppression can justify the extended limitation period.

Calcium Citrate was treated as excisable and marketable because it was a separate chemically defined organic compound falling within the tariff, and the record showed recognised market uses and no proven lack of marketability. Innoculum Media was held not marketable and therefore not excisable, as there was no evidence to displace the finding that it lacked the attributes of a marketable commodity. The extended limitation period was upheld because the captive consumption and existence of impure Calcium Citrate as an intermediate product had not been disclosed in the classification lists, and the allegation of suppression remained unrebutted.

---

---

Issues: (i) Whether Calcium Citrate was excisable and marketable; (ii) whether Innoculum Media was marketable and excisable; (iii) whether the extended period of limitation was correctly invoked on the ground of suppression of facts.

Issue (i): Whether Calcium Citrate was excisable and marketable

Analysis: Calcium Citrate was a separate chemically defined organic compound and fell under the relevant tariff heading. The absence of a surviving shelf-life was not established; on the contrary, the material showed that the substance was required to be decomposed in the course of manufacture and had several recognized uses in the market. The finding that it was non-marketable was unsupported.

Conclusion: Calcium Citrate was excisable and marketable. The conclusion was in favour of Revenue.

Issue (ii): Whether Innoculum Media was marketable and excisable

Analysis: On the record, there was no evidence to dislodge the finding that Innoculum Media was not marketable. The assessee failed to show that the intermediate product had the attributes necessary to be treated as a marketable commodity.

Conclusion: Innoculum Media was not marketable and therefore not excisable. The conclusion was in favour of the assessee.

Issue (iii): Whether the extended period of limitation was correctly invoked on the ground of suppression of facts

Analysis: The record showed that the existence of impure Calcium Citrate as an intermediate product and its captive consumption in the manufacture of Citric Acid had not been disclosed in the classification lists. There was no effective rebuttal to the allegation of suppression made in the show cause notice.

Conclusion: The extended period of limitation was rightly invoked. The conclusion was in favour of Revenue.

Final Conclusion: The demand on Calcium Citrate and the finding on limitation were sustained, while the finding on Innoculum Media was upheld, resulting in only partial relief to the Revenue.

Ratio Decidendi: An intermediate product is excisable only if it is marketable, and a separate chemically defined organic compound falling within the tariff cannot escape duty merely by asserting lack of shelf-life when the material shows market demand and captive consumption is suppressed from the Department.

---