Marketability requirement for excise duty defeated where unpurified gas mixture was not shown to be sulphur dioxide gas.

An unpurified gaseous mixture arising from burning or heating sulphur was not established to be sulphur dioxide gas. The text notes that no separate purification process or plant was shown, and no evidence proved that the mixture, as it emerged, was marketable or known in the market as sulphur dioxide gas. Since excise duty requires manufacture of a distinct and marketable commodity, the absence of proof on those points meant the levy could not be sustained. An earlier view treating the intermediate product as dutiable was noted as not governing the matter in light of a later contrary position.

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Issues: Whether the gaseous product arising on burning or heating of sulphur, being a mixture of gases containing sulphur dioxide, nitrogen and other gases, was sulphur dioxide gas and therefore dutiable as excisable goods.

Analysis: The product was found to be an unpurified mixture of gases, not sulphur dioxide gas as such. The record did not show any separate plant or process for purification, and no evidence was produced to establish that the mixture, in the form in which it emerged, was marketable or known in the market as sulphur dioxide gas. For levy of excise duty, the product must amount to manufacture of a distinct and marketable commodity. In the absence of proof that the mixture itself satisfied that test, duty could not be sustained. The reliance placed on an earlier view treating the intermediate product as dutiable was held not to govern the matter in view of the later contrary position.

Conclusion: The product was not proved to be sulphur dioxide gas or a marketable excisable commodity, and the demand of duty was unsustainable.

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