TMI Blog1994 (2) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, the conclusion arrived at by the Tribunal is unobjectionable. Appeal dismissed. - Civil Appeal No. 4030-45 of 1991 - - - Dated:- 1-2-1994 - B.P. Jeevan Reddy and B.L. Hansaria, JJ. Joseph Vellapalli, Senior Advocate (Ashok K. Srivastava, Advocate with him), for the respondent. Shanti Bhushan, Senior Advocate (K. Rajendra Chowdhary, Rakesh K. Sharma and Ashok Grover, Advocates, with him), for the appellant. [Judgment per : B.P. Jeevan Reddy, J.]. - The question raised in this batch of appeals is whether the prestressed cement concrete poles manufactured by the appellant, Andhra Pradesh State Electricity Board, are "goods" within the meaning of Section 3 of the Central Excises and Salt Act, 1944. Section 3 levies duties of excise "on all excisable goods .... which are produced or maufactured in India". The expression "excisable goods" is defined in clause (b) of Section 2. At the relevant time, the definition ran thus: "excisable goods means goods specified in the Schedule to this Act as being subject to a duty of excise and includes salt". The expression "goods" is not defined. According to the learned counsel for the appellant, goods contemplated by Section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat just as the appellant-Board requires poles of different sizes, strength and dimensions, so does Kerala Board. The fact that Kerala Board purchases these poles from contractors clearly establishes the marketability of these poles. The fact that the appellant does not sell these poles does not affect the marketability of the said goods. The counsel also pointed out that, besides Electricity Board, there are other establishments engaged in the manufacture of electricity like Tatas in Bombay. They too require poles of different sizes which may either be manufactured by them or purchased from independent contractors. 4. Since the requirement of `marketability' has been evolved by a process of judicial interpretation, it would be appropriate to notice the relevant decisions, upon which strong reliance is placed by Shri Shanti Bhushan. 5. The first decision is in Union of India v. Delhi Cloth General Mills [1977 (1) E.L.T. (J199) (SC) = 1963 Suppl. (1) S.C.R. 586]. The respondent-mills was engaged in the manufacture of vegetable product known as "Vanaspati". Vanaspati was subject to duty. It was the common case of both the parties that for the purpose of manufacturing vanaspati, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ygen and a small quantity of carbon monoxide. The content of carbon dioxide in this mixture of gases ranged from 27 to 36.5%. The said mixture of gases was compressed so as to achieve pressure exceeding atmospheric pressure and then passed through a tank containing sugarcane juice so as to remove impurities from it and refine the juice. Actually, for the purpose of refining, only carbon dioxide in the gas was used. The remaining gases escaped into the atmosphere by a vent provided for the purpose. The Revenue sought to treat the respondent-mills and other similar mills as manufacturers of "compressed carbon dioxide" and sought to levy duty on it under Tariff Item 14H. The respondent's case was that they maintained lime kiln to generate a mixture of gases and not carbon dioxide and that at no stage in the process of generating this mixture and passing it through the sugarcane juice was carbon dioxide - which formed a part of this mixture of gases - either compressed, liquified or solidified. They contended that the mixture of gases generated by them was not carbon dioxide, as known to the market, since carbon dioxide as known to market, as per specification laid down by Indian Stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing with the said demand, the appellant protested that the said aluminium cans cannot be described as "goods" for the purpose of levying excise duty inasmuch as they are not marketable and that they are prepared only for the purpose of flashlights manufactured by the appellant. It was also submitted that preparation of aluminium cans out of aluminium slugs did not amount to manufacture and that aluminium cans are merely intermediate products in the manufacture of flashlights. The aluminium cans prepared by the appellant, it submitted, were manufactured by it entirely for its own purposes, viz., for the manufacture of flashlights. The aluminium cans at the point at which the excise duty was sought to be levied were in a crude and elementary form incapable of being employed in that state as components in a flashlights. The cans had sharp uneven edges and before they could be used as a component in making the flashlight, these cans had to undergo various processes such as trimming, threading and redrawing. After trimming, threading and redrawing, they were reeded, beaded and anodised or painted. It is at that point that they became distinct and complete components capable of being use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent produced evidence to show that starch hydrolysate was highly unstable, that it fragmented quickly losing its character in a couple of days. For this reason, it could neither be stored nor marketed. There was no evidence to the contrary adduced by the Revenue. This court observed that while even transient items of articles can also be goods, one has to take a practical approach and decide on the basis of material before the court whether the particular goods were marketable. After referring to the characteristics of the said product (starch hydrolysate), the court came to the "conclusion that it would be unlikely to be marketable as it was highly unstable." The test, therefore, is the "marketability"; this test has to be applied and the matter decided in a pragmatic and practical sense. 10. It would be evident from the facts and ratio of the above decisions that the goods in each case were found to be not marketable. Whether it is refined oil (non-deodorised) concerned in Delhi Cloth and General Mills, or kiln gas in South Bihar Sugar Mills, or aluminium cans with rough uneven surface in Union Carbide, or PVC films in Bhor Industries or hydrolysate in Ambalal Sarabhai, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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