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What is marketable is dutiable - Supreme Court on Excise matters

Perfumery compounds prepared for applying to incense sticks are subject to excise duty, though the final product, agarbattis, may be exempted, the Supreme Court has said. This is because the compound is capable of being sold as is and it wasn’t necessary to prove that the compound was indeed sold; “marketability is the test of dutiability”, the Supreme Court stated in its judgment, Commissioner of Central Excise vs Karnataka Soaps & Detergents. The court set aside the decision of the Excise Appellate Tribunal, which held the opposite view. In this case, the firm manufactured odoriferous compound in Bengaluru and trans ported it in liquid form to Mysuru, where it was ap plied to in cense sticks to complete the manufacturing process. The revenue authorities demanded excise duty on the perfume compound be cause it was capable of being sold as a product. They pointed out that the compound was in fact sold to Tibetan Handicraft Centre in Mysuru. The firm contended that it was applied to the final product, and therefore it did not attract the levy. The court accepted the argument of the excise authorities.

Article referred: https://www.pressreader.com/india/business-standard/20171023/281904478419870


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