Marketability principle bars excise duty on a water treatment plant fabricated and fixed at site.

A water treatment plant fabricated and assembled at site, and permanently fixed to earth by civil work, did not satisfy the test of excisable goods. Only vessels and pipes were manufactured in the factory and cleared on duty; the complete plant was not shown to have been assembled in the factory or removed in a marketable condition. As the record did not establish that the plant, as such, could be moved to market and sold, the marketability principle was not met. The plant was therefore not liable to central excise duty under the tariff heading in issue.

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Issues: Whether a water treatment plant fabricated and assembled at site, and fixed to earth by civil work, constituted excisable goods liable to duty under Heading 8421.00 of the Central Excise Tariff.

Analysis: The Revenue's case was that the plant was manufactured in a knocked down condition and cleared to site for assembly, but the record showed that only vessels and pipes were manufactured in the factory and cleared on duty, while the water treatment plant itself was fabricated at site. There was no evidence that the complete plant was assembled in the factory and then removed in a marketable condition. The plant was permanently attached by civil work, and no material showed that the plant as such could be taken to the market and sold. Applying the marketability principle, goods that cannot be moved and marketed in that form do not satisfy the test of excisability.

Conclusion: The water treatment plant was not excisable goods and no duty was payable on it; the Revenue's appeal failed.

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