2014 (8) TMI 882 - AT - Central Excise

Manufacture of sugar syrup - captive consumption in manufacturing of final product - marketability - Held that - In an identical matter involving dutiability of sugar syrup, in the case of Shiv Shakti Processed Foods Vs. Commissioner of Central Excise, Pune -I, this Tribunal vide 2014 (7) TMI 395 - CESTAT MUMBAI remanded the matter back to the adjudicating authority to consider the issue of marketability of sugar syrup and thereafter, consider the dutiability thereon relying on the decision of this Tribunal in the case of Ambaji Foods (India) PVt. Ltd. Vs. Commissioner of Central, Kanpur reported in 2010 (8) TMI 714 - CESTAT, NEW DELHI . In the present case also, the adjudicating authority has not considered and given any finding as to the marketability of the sugar syrup and merely concluded that since sugar syrup is manufacture in the factory, the same is dutiable. There are a number of decisions Hon ble Apex Court, wherein it has been held that mere inclusion of a product in the Heading does not determine its exigibility unless it is shown that the product emerging at the intermediate stage is marketable. Therefore, in the present case also following the earlier decision, we remand the matter back to the adjudicating authority for consideration whether sugar syrup is marketable or not and thereafter, pass a speaking order as to the duty liability of the appellant. - Decided in favour of assessee.

Summary

Issues:
1. Confirmation of duty demand on Sugar Syrup alleged to have been manufactured.
2. Consideration of marketability of sugar syrup for determining dutiability.

Analysis:
1. The appeal challenged Order-in-Appeal confirming a duty demand of &8377; 9,15,670/- along with interest and penalty on Sugar Syrup manufactured by the appellant. The Revenue argued that as sugar syrup is specified in the Excise Tariff, excise duty is applicable if it is used in final goods' manufacture. The Tribunal, noting the absence of the appellant, waived pre-deposit and proceeded to hear the appeal.

2. The Tribunal referred to a previous case involving the dutiability of sugar syrup, where it was remanded for considering the marketability of the product before determining duty liability. In the current case, the adjudicating authority had not assessed the marketability of the sugar syrup but solely concluded on its dutiability due to manufacturing. Citing Supreme Court decisions, the Tribunal emphasized that inclusion in the tariff heading doesn't automatically imply dutiability without proving marketability. Consequently, the matter was remanded to the adjudicating authority to evaluate the marketability of sugar syrup and decide on duty liability accordingly.

3. The Tribunal allowed the appeal by way of remand, emphasizing the necessity to assess marketability before determining duty liability on sugar syrup. The stay petition was also disposed of in light of the remand decision. The judgment was dictated and pronounced in court, providing clarity on the course of action to be taken in the case.