Where the price at which goods are ordinarily sold by the assessee is different for different places of removal, then each such price shall be deemed to be the normal value thereof. Clause (b)(iii) is very important and makes it clear that a depot, the premises of a consignment agent, or any other place or premises from where the excisable goods are to be sold after their clearance from the factory are all places of removal. What is important to note is that each of these premises is referable only to the manufacturer and not to the buyer of excisable goods. The depot, or the premises of a consignment agent of the manufacturer are obviously places which are referable only to the manufacturer. Even the expression “any other place or premises” refers only to a manufacturer’s place or premises because such place or premises is stated to be where excisable goods “are to be sold”. The place or premises from where excisable goods are to be sold can only be the manufacturer’s premises or premises referable to the manufacturer. CCE v. Ispat Industries Ltd., (2016) 1 SCC 631.
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In APSEB v. CCE, (1994) 2 SCC 428, it was held thus:
“marketability is an essential ingredient in order to be dutiable under the Schedule to the Act.”
The marketability is thus essentially a question of fact to be decided on the facts of each case. There can be no generalization.
Marketability is a decisive test for dutiability. It only means ‘saleable’ or ‘suitable for sale’. It need not be in fact ‘marketed’. The article should be capable of being sold or being sold, to the consumers in the market, as it is – without anything more.
In Moti Laminates (P) Ltd. v. CCE, (1995) 3 SCC 23 the court held that an intermediate product, namely, resols, not being marketable would not be exigible to duty. The court held:
“Although the duty of excise is on manufacture or production of the goods, but the entire concept of bringing out new commodity etc, is linked with marketability. An article does not become goods in common parlance unless by production or manufacture something new and different is brought out which can be bought and sold. In Union of India v. Delhi Cloth and General Mills Co. Ltd., (1977) 1 ELT 199, while construing the word ‘goods’, it was held as under:
“These definitions make it clear that to become “goods” an article must be something which can ordinarily come to the market to be bought and sold”. Therefore, any goods to attract excise duty must satisfy the test of marketability. The tariff schedule by placing the goods in specific and general category does not alter the basic structure of leviability. The duty is attracted not because an article is covered in any of the items or it falls in residuary category but it must further have been produced or manufactured and it is capable of being bought and sold.”
In Union of India v. Sonic Electrochem (P) Ltd., (2002) 7 SCC 435, the question whether the plastic body of electro mosquito repellant was excisable goods was decided thus:
“The germane question is whether it has marketability. The plastic body is being manufactured to suit the requirements of EMR of the respondents and is not available in the market for being bought and sold. It is not a standardized item or goods known and generally dealt with in the market. It is being manufactured by the respondents for its captive consumption. It is not a product known in the market with any commercial name.
Marketability of goods has certain attributes. The essence of marketability is neither in the form nor in the shape or condition in which the manufactured articles are to be found, it is the commercial identity of the articles known to the market for being bought and sold. The fact that the product in question is generally not being bought and sold or has no demand in the market would be irrelevant. The plastic body of EMR does not satisfy the aforementioned criteria. There are some competing manufacturers of EMR. Each is having a different plastic body to suit its design and requirement. If one goes to the market to purchase the plastic body of EMR of the respondents either for replacement or otherwise, one cannot get it in the market because at present, it is not a commercially known product. For these reasons, the plastic body, which is a part of EMR of the respondents, is not ‘goods’ so as to be liable to duty as parts of EMR under Para 5 (f) of the said exemption notification. Escorts Ltd. v. CCE, (2015) 9 SCC 109.