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TMI Blog2010 (8) TMI 714X X X X Extracts X X X X X X X X Extracts X X X X ..... umar, Member (T) Per: R M S Khandeparkar: Since common question of law and fact arises in all these three appeals they were heard together and are being disposed of by this common order. These appeals were taken up for hearing in terms of the order passed in the stay applications No. 1082-1084 of 2010. 2. The appellants M/s Ambaji Foods (India) Pvt. Ltd. and M/s K.N. Bakers Pvt. Ltd. are manufacturers of biscuits of MRP below Rs.100/- per kg. classifiable under chapter heading 19059020 of the schedule to the Central Excise Tariff Act, 1985. They are also engaged in manufacturing of sugar syrup as an intermediate product which is captively consumed for manufacture of the said biscuits. The biscuits of MRP below Rs.100/- per kg. are exempted from Central Excise Duty in terms of Notification No.22/2007-CE dated 3rd May 2007. On the ground that the final product is exempt from payment of duty, in relation to the Sugar Syrup, being the intermediate product, could not have claimed the benefit of Notification No.67/1995-CE dated 16th March 1995, the show cause notices came to be issued for recovery of the duty in relation to the Ambaji Foods (India) Pvt. Ltd. for the period from O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Narmada Valley Fert. Co. Ltd. vs. CCE reported in 2005 (184) E.L.T. 128 (S.C). 6. Perusal of the impugned order discloses that the said authority while dealing with the issue regarding the marketability raised by the appellants in case of Ambaji Foods (India) P. Ltd. are concerned, has held thus :- "15. The next is the issue of marketability. In this regard, I observe that all the points submitted in the defence reply submitted with the adjudicating authority have been incorporated in the Order-in-Original, which means that the order has been passed after considering the entire submissions. The contention of the appellant that the adjudicating authority has not recorded any finding on the issue of marketability of sugar syrup has got no relevancy. I find that the question of marketability arises only when, the same has to be marketed as such. The Sugar Syrup in this case is an intermediate product being used for manufacturing the biscuits, which are the exempted finished goods. In the instant case the issue relates to denial of benefit notification no. 67/95-CE, which clearly stipulates that duty on excisable intermediate product has to be discharged in case the finished g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nished goods are exempted. The notification does not stipulate any condition of saleability or marketability for allowing or denying the benefit of the said notification. The concept of individual marketability cannot be applied in case of such products because, such intermediate products loose their identity when they are used in final products, which are marketed ultimately. Therefore, the marketability of such intermediate products has to be considered in conjunction with the final products. Since, the biscuits are sold, the saleability/marketability of the sugar syrup is established and the same can be deemed to be a marketable/saleable commodity." 8. Plain reading of the impugned orders discloses complete failure on the part of the Commissioner (Appeals) to consider the issue regarding the requirement of the marketability which is to be established by the department before a product can be qualified to be an excisable product warranting duty liability. The issue which was raised by the appellants was that the intermediate product in the nature of sugar syrup was not marketable and the same was required to be decided with reference to the said product only and not with referen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s far as the case of M/s K.N. Bakers Pvt. Ltd. is concerned, the said issue has been dealt with as under :- "The question of marketability of Sugar Syrup has also been examined. The party submitted that Sugar syrup made of own specification and proportions suitable to use in manufacture of biscuits, are not capable of being bought and sold in market and no other manufacturer would buy their Sugar syrup since taste of the Sugar syrup of each manufacturer is distinct for which different ingredients in different proportions are mixed subjected to process/processes to manufacture sugar syrup and cited a catena of decisions. On going through the submission of the party in this regard it is seen that there is difference between actual sale and marketability of the product. Actual sale/marketing is not a factor to decide the capability of marketing of any goods. The various courts have pronounced in their judgments that even if the goods are not sold in the open market, the goods may be capable of being sold in the market. The possibility of the marketability of the product in question cannot be ruled out since the product Sugar syrup has got considerable shelf life and the party h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds, though actual sale need not be established, the capability of the product being sold in the market or known in the market as goods must be established. It nowhere discloses any analysis of the materials on record to arrive at any finding regarding capability of the product being sold in the market or the same as being known to the market as the goods. Before relying upon any decision, it is necessary for the Adjudicating Authority to analyse the materials in relation to the facts of the case and to ascertain whether the reported decision of the higher authority is applicable to such the facts of the case in hand. 12. Plain reading of the orders passed by both the lower authorities apparently, therefore, discloses failure on the part of the authorities to consider the issue of marketability in the manner it was required to be decided as rightly pointed out by the learned advocate for the appellants. The authorities will have to analyse the materials on record and thereafter ascertain whether the same reveal the marketability of the product or not and accordingly decide about the duty liability. Since the authorities below have failed to carry out this exercise before confirmin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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