Bata India Limited vs Commissioner of Central Excise, New Delhi [SUPREME COURT OF INDIA, 12 Apr 2010]
Excise - Indirect Tax
Central Excise Act, 1944, ss. 2 (d) and 11A - Central Excise Rules, 1944, r. 173Q(1) - Central Excise Tariff Act, 1985, heading 5905.10 - Excisable good - Unvulcanised sandwiched fabric/ Double textured rubberized fabrics - Assessee is a well known manufacturer of foot wear - During the process of manufacturing of foot wear various chemicals / rubbers / solvents etc., are mixed together and a thin layer of such mixed materials is sandwiched - Said product is later cut and stitched according to the assessee's requirements and in-process materials are used as shoe- uppers in the foot wear - Such fabrics are also at times sent to job workers for stitching purposes only and the fabric sandwiched with the mixed materials are inputs of the intermediate stage during the course of manufacture of footwear - Vulcanisation of the foot wear takes place only after completing the entire process to render it a finished product as a footwear - Collector of Central Excise held unvulcanised sandwiched fabric/double textured fabrics are marketable products fulfilling the requirement of the definition of excisable goods attracting the levy of central excise duty under the Act - On appeal, Commissioner upheld the order of Collector - Tribunal by a majority order held that double textured rubberized fabrics /unvulcanized stitched fabric is an excisable product attracting duty - Hence, present appeal - Whether unvulcanised sandwiched fabric assembly produced in the Assessee's factory and captively consumed can be termed as ‘goods’ and can be classified as "rubberized cotton fabrics" falling under sub-heading number 5905.10 of the schedule to the Central Excise Tariff Act, 1985? - Held, product in question is used as an intermediate product, goes to make the component for the final product - Burden to show that the product in question is marketed or capable of being bought or sold in the market so as to attract duty is entirely on the Revenue - Revenue has not produced any material before the tribunal to show that the product is either been marketed or capable of being marketed but expressed its opinion unsupported by any relevant materials - Mere fact that the product in question was entrusted outside for some job work such as stitching is not an indication to show that the product is commercially distinct or marketable product - Hence, impugned product is not excisable - Tribunal’s order set aside - Appeal allowed.
