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PETITIONER: COLLECTOR OF CENTRAL EXCISE, BARODA

       Vs.

RESPONDENT: AMBALAL SARABHAI ENTERPRISES

DATE OF JUDGMENT10/08/1989

BENCH: MUKHARJI, SABYASACHI (J) BENCH: MUKHARJI, SABYASACHI (J) RAY, B.C. (J)

CITATION:  1990 AIR   59            1989 SCR  (3) 784  1989 SCC  (4) 112        JT 1989 (3)   341  1989 SCALE  (2)255  CITATOR INFO :  R          1990 SC1893  (4)

ACT:     Central Excises And Salt Act, 1944/Central Excise Rules, 1944: Sections 3, 4,11-A and 35L--’Goods ’--Starch  hydroly- sate---Whether ’goods ’--Whether duty leviable.

HEADNOTE:     The respondent was engaged in the manufacture of  sorbi- tol, which fell under items 68 of the Central Excise Tariff. During a visit to the factory premises by the Central Excise Officers it was found that the respondent also  manufactured and  captively consumed starch hydrolysate which,  according to  the appellant, was glucose and fell under Item E of  the Central  Excise  Tariff. In reply to the  show-cause  notice issued  by  the  appellant, the  respondent  contended  that starch  hydrolysate was not ’goods’ since the same  was  not marketable  and therefore no excise duty was payable on  it; and  that even if the same was liable for duty it would  not be  under  Item  1-E. There  were  adjudication  proceedings thereafter, and the adjudicator held that starch hydrolysate was  glucose and fell under item E, and that the  respondent had  suppressed  the  fact of manufacture  thereof.  In  the premises, the adjudicator ordered payment of excise duty and further imposed a penalty.     The  Tribunal, however, allowed the respondent’s  appeal and  held  that starch hydrolysate manufactured by  the  re- spondent was not, and never was, a marketable commodity, and hence  that would not be ’goods’ on which excise duty  could be charged.     The  Revenue appealed to this Court. Before this  Court, it was inter alia contended on behalf of the appellant:  (i) that the Tribunal misdirected itself in applying the  proper test  for  the determination of the question, and  that  the true  test  to determine in a matter of this nature  was  to consider  not only whether starch hydrolysate  was  actually marketable  but  also to consider whether  conceptually  the said goods were capable of being marketed, and the  Tribunal should have examined or called for fresh evidence to  deter- mine  that question; and (ii) even transient items of  arti- cles  could  he ’goods’. provided these were  known  in  the

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market as distinct and separate articles having distinct and separate  uses, and if these were capable of being  marketed even during short period. 784 785     On  behalf of the respondent it was contended that;  (i) starch hydrolysate which was utilised in the manufacture  of sorbitol,  was  not being marketed and was  not  capable  of being  marketed  in view of its  highly  unstable  character resulting  in fragmentation even if kept for a day  or  two; and  (ii) starch hydrolysate was not marketable product  and would  not therefore be "goods" on the manufacture of  which excise  duty  could have been demanded or  would  have  been payable  and  therefore for non-payment of duty,  there  had been no negligence or failure. Dismissing the appeal, this Court,     HELD:  (1)  If the process or activity of  the  assessee brings into existence an article different and distinct from what it was before the process and a new identifiable  arti- cle  known in the market as such comes into being, then  the use   of   such   article  in  the   instant   case   starch hydrolysate--would attract duty on the part of the  assessee even in captive consumption. [788G]     South  Bihar Sugar Mills Ltd., etc. v. Union of India  & Ors., [1968] 3 SCR 21, referred to.     (2)  The word "manufacture" implies a change  but  every change in the raw material is not manufacture. There must be such  a  transformation  that a new  and  different  article emerges having a distinct name, character or use. [790D]     Union  of  India v. Delhi Cloth &  General  Mills  Ltd., [1963] Supp. 1 SCR 586.     (3) Duty is levied on goods. As the Central Excises  and Salt Act, 1944 does not define "goods", the legislature must be taken to have used that word in its ordinary,  dictionary meaning. The dictionary meaning of the expression is that to become goods it must be something which can ordinarily  come to  the  market to be bought and sold and is  known  to  the market.  It  would be such an article  which  would  attract ’duty’ under the Act. [790E]     Union  Carbide  India  Ltd. v. Union of  India  &  Ors., [1986] 24 ELT 169.     (4)  It is true that the goods with  unstable  character can  be  theoretically marketable if there was a  market  of such transient type of articles which are goods. But one has to take a practical approach. [792G] 786     (5) It was the duty of the Revenue to adduce evidence or proof  that  the  articles in question were  goods.  If  the Department  was  to  charge duty of excise  on  this  starch hydrolysate as one form of glucose it would be the burden on the Department to establish that starch hydrolysate was  not merely marketable but was being marketed as glucose in  some form.  The Revenue has not produced any evidence  whatsoever though  asked to do so. Bhor Industries Ltd. Bombay v.  Col- lector of Central Excise, Bombay, [1989] 1 SCC 602. [793A-F]     (6)  It appears that there was no market enquiry by  the Revenue.  In view of the fact that there was  positive  evi- dence that starch hydrolysate was never marketed and in view of further fact that in the light of the nature of the goods being  highly  unstable, it was highly improbable  that  the goods  were  capable of being marketed and  there  being  in spite of the opportunities, no evidence produced at all that the  goods,  in fact, were capable of being  marketable,  it must be held, as did the Tribunal, that the starch  hydroly- sate  were not dutiable under the Central Excises  and  Salt

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Act, 1944. [794G-795A]

JUDGMENT:     CIVIL   APPELLATE  JURISDICTION: Civil  Appeal   No.  22 15(NA) of 1988.     From the Judgment and Order dated 2.11.87 of the Customs Excise  and Gold (Control) Appellate Tribunal, New Delhi  in Appeal No. 478 of 86--D (Order No. 877 of 1987-D.)     A.K. Ganguli, T.V.S.N. Chari, P. Parmeswaran and  Sushma Suri for the Appellant.       Soli J. Sorabjee, R. Narain, Kamal Mehta, P-K. Ram and D.N. Misra for the Respondent. The Judgment of the Court was delivered by     SABYASACHI MUKHARJI, J. This is an appeal under  section 35L(b) of the Central Excises & Salt Act, 1944  (hereinafter referred  to as ’the Act’). The appeal is  directed  against the  order dated 2nd November, 1987 passed by  the  Customs, Excise  and  Gold (Control) Appellate  Tribunal,  New  Delhi (hereinafter referred to as ’the Tribunal’). The respondent, viz., M/s Ambalal Sarabhai Enterprises manufacture  sorbitol failing  under item 68 of the erstwhile Central Excise  Tar- iff.  There was a visit to the factory premises of  the  re- spondent  by the Central Excise Officers on  26th  February, 1985. It was 787 allowed  that it was found that the respondent  manufactured and captively consumed starch hydrolysate but the respondent had failed to take out a licence with reference to the  said manufacture of starch hydrolysate and had been removing  the same  without, according to the appellant, payment  of  duty and without observing the necessary central excise  formali- ties. It was the view of the revenue that starch hydrolysate was  glucose  and,  therefore, fell under Item  1-E  of  the Central  Excise  Tariff, which covered glucose  in  whatever form  including  liquid glucose. Accordingly, a  show  cause notice  was issued to the respondent. A reply was  filed  on behalf of the respondent contending that starch  hydrolysate was  not  "goods"  since the same was  not  marketable  and, therefore,  no excise duty would be payable on the same.  In those  circumstances,  it was submitted  that  the  proposed adjudication by the Collector following the aforesaid notice was without jurisdiction in view of section 11A of the  Act. It was urged that starch hydrolysate is not glucose and that even  if the same was liable for duty it would not be  under item E. According to him, starch hydrolysate was an interme- diate  product  in the manufacture of sorbitol and  no  duty could  be  demanded  on the same.  There  were  adjudication proceedings thereafter. In the said proceedings,  affidavits were filed on behalf of the respondent, witnesses on  behalf of  the revenue were cross-examined and the  Collector  also cross-examined the witnesses of the respondent. By an  order dated  6th December, 1985, the Collector of Central  Excise, Baroda  rejected frae contention of the respondent.  It  was held  by  him that starch hydrolysate was glucose  and  fell under  item  1-E of the Central Excise Tariff and  that  the respondent  had suppressed the fact of  manufacture  thereof for  consumption in the further manufacture of sorbitol.  In the premises, he  ordered the respondent to pay excise  duty amounting to Rs.34,92,559.55 paise and imposed a penalty  of Rs. 10 lakhs. Aggrieved by the said order of the  Collector, the respondent preferred an appeal before the Tribunal.  The Tribunal  by its order dated 2nd November, 1987,  being  the order  under appeal, held that starch  hydrolysate  manufac-

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tured  by  the respondent is not and  never  was  marketable commodity,  and  hence that would not be  "goods"  on  which excise duty could be charged. In the premises, the  Tribunal allowed the appeal filed by the respondent and set aside the order of the Collector. Aggrieved thereby, the appellant has come up in appeal to this Court under section 35L(b) of  the Act.     On behalf of the appellant, Shri Ganguly contended  that the Tribunal misdirected itself in applying the proper  test for  the  determination of the question. He urged  that  the true test to determine in a 788 matter  of  this  nature was to consider  not  only  whether starch  hydrolysate  was  actually marketable  but  also  to consider  whether  conceptually the said goods  in  question were  capable  of  being marketable. It was  urged  by  Shri Ganguly  that  the Tribunal had misdirected  itself  in  not appreciating  this aspect of the matter and did not as  such examine  or view the evidence on record in the  proper  per- spective.  He urged that in the aforesaid light and in  view of  the findings made by the Collector, there was no  ground for the Tribunal to interfere with the order of the  Collec- tor. He further submitted that in any event, if the Tribunal was  not  fully  satisfied with the evidence  on  record  to determine whether starch hydrolysate were goods in the sense of  being marketable, then the Tribunal should have, in  the facts and the circumstances of the case and in the  interest of  justice, remanded the matter back for  appraisement  and examination in the light of the true principle or the Tribu- nal should have examined or called for the fresh evidence to determine  this question. The Tribunal not having  done  so, has  failed to render justice and as such the order  of  the Tribunal  is  bad, according to Shri Ganguly.  Shri  Ganguly further submitted that in starch hydrolysate the  percentage of dissolved solids present is 64. It was submitted that the criterion  laid  down  in the IS  Specification  for  liquid glucose  or  glucose  syrup, the two terms  are  being  used synonymously  by  the Indian Standard Institution,  was  not satisfied in this case. The IS Specification defines  liquid glucose  or  glucose syrup as "a  refined  and  concentrated non-crystalizable aqueous solution of d-glucose, maltose and other polymers of d-glucose, obtained by controlled hydroly- sis of starch containing material". The United States  Phar- meopeia XIX describes liquid hydrolysis of starch,  consist- ing chiefly of dextrose, dextrins, maltose and water and  in these  circumstances and in view of the components  and  the dictionary  meaning  as  discussed by the  Tribunal  in  its order,  it  is urged that it cannot be said  that  the  said goods is the same thing as glucose or glucose syrup. In  the premises, it was contended that the Tribunal has not consid- ered this aspect of the matter.     We are concerned in this appeal with starch  hydrolysate and,  therefore, if the process or activity of the  assessee brings into existence an article different and distinct from what it was before the process and a new identifiable  arti- cle  known in the market as such comes into being, then  the use of such starch hydrolysate captively would attract  duty on the part of the assessee even in captive consumption.  It is not in dispute as the Tribunal noted in the instant  case that  starch is hydrolysed by the respondent. The  operation of  hydrolysis,  it is contended, results in  bringing  into being  starch hydrolysate which is utilised in the  manufac- ture of sorbitol. The question is--whether 789 starch  hydrolysate is "goods". The case of  the  respondent

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was  that the starch hydrolysate being wholly  unstable  and quickly  fragmented and losing its character in a couple  of days,  the  same  could, therefore, neither  be  stored  nor marketed. In the premises, it was the case of the respondent that starch hydrolysate was not marketable product and would not,  therefore,  be  "goods" on the  manufacture  of  which excise  duty  could have been demanded or  would  have  been payable  and, therefore, for non-payment of duty, there  has been no negligence or failure on the part of the  respondent and  as such section 11-A of the Act was not applicable.  In this  connection,  it would be instructive to refer  and  it would  be necessary to rely on the principles laid  down  by this Court in South Bihar Sugar Mills Ltd., etc. v. Union of India  & Ors., [1968] 3 SCR 21. There, the appellant  compa- nies  manufactured  sugar by carbonation  process  and  paid excise  duty on sugar manufactured by them under Item  I  of Schedule  I to the Act. According to one affidavit filed  on behalf of the respondents, filed in those proceedings, these manufacturers employed a process of burning lime-stone  with coke in a lime kiln with a regulated amount of air whereby a mixture of gases was generated consisting of carbon dioxide, nitrogen,  oxygen and a small quantity of  carbon  monoxide. The  gas  thus produced was thereafter compressed so  as  to achieve  pressure  exceeding atmospheric pressure  and  then passed  through a tank containing sugarcane juice so  as  to remove impurities from it and to refine the juice. For  that process  of refining it was only the carbon dioxide  in  the gas  which  was used and the other  gases,  i.e.,  nitrogen, oxygen and carbon monoxide escaped into the atmosphere by  a vent provided for the purpose. The carbon dioxide content in this  mixture of gases ranged from 27 to  36.5%.  Similarly, another company manufactured Soda ash by solvay ammonia soda process for which also carbon dioxide was required and  this was produced by the petitioner therein by burning lime-stone with  coke  in a kiln in the same manner  as  the  appellant sugar  manufacturing  companies  employing  the  carbonation process. The respondents therein regarded all the  companies as  manufacturers  of compressed carbon dioxide  and  levied excise  duty  on them under Item 14-H in Schedule I  to  the Act. Writ petitions were filed in the High Court challenging the validity of the excise duty but the same petitions  were dismissed.  It was contended, inter alia, on behalf  of  the appellants  therein  that the lime kiln  was  maintained  to generate a mixture of gases and not carbon dioxide and at no stage in the process of generating this mixture and  passing it  through  the sugarcane juice was  carbon  dioxide--which formed  one  of  the contents of  the  mixture--either  com- pressed, liquidified or solidified. The mixture of gases  so generated was not carbon dioxide as known to the market  nor was it accord- 790 ing to the specifications laid down by the Indian  Standards Institution which required the carbon dioxide content to  be at  least 99%. It was, therefore, contended that the  excise duty sought to be recovered on the contend of carbon dioxide in  the mixture of gases could not fall under Item 14-H.  It was further contended that the duty being on goods it  could be  charged  only on goods known as carbon  dioxide  in  the trade  and marketable as such. As is evident from  the  said narration  of facts the contentions urged were more or  less similar  to the contentions involved in the  instant  appeal before us. It was held by this Court that the gas  generated by  the  appellant  companies was kiln gas  and  not  carbon dioxide  as known to the trade, i.e., to those who dealt  in it or who used it. The kiln gas in question, therefore,  was

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neither  carbon dioxide nor compressed carbon dioxide  known as such to the commercial community and therefore, could not attract item 14-H in the First Schedule. This Court  reiter- ated at p. 31 of the report that the Act in question charges duty on manufacture of goods. The word "manufacture" implies a  change but every change in the raw material is not  manu- facture. There must be such a transformation that a new  and different article must emerge having a distinct name,  char- acter  or use. The duty is levied on goods. As the Act  does not define goods, the legislature must be taken to have used that word in its ordinary, dictionary meaning. The  diction- ary  meaning  of the expression is that to become  goods  it must be something which can ordinarily come to the market to be  bought and sold and is known to the market. It would  be such an article which would attract duty under the Act. This Court referred to the previous decision in the case of Union of India v. Delhi Cloth & General Mills Ltd., [1963]  Suppl. 1  SCR 586. Therefore, in this instant appeal, in  order  to determine whether starch hydrolysate was "goods" or not,  it is necessary to determine whether there was any  application of  process  to the raw materials and as a  result  of  that application there emerged new and different article having a distinctive name, character or use and the resultant product being goods in the sense of being marketable or marketed. In this  connection,  Shri  Soli Sorabjee referred  us  to  the observations  of this Court in Union Carbide India  Ltd.  v. Union  of  India and Ors., [1986] 24 ELT  169.  There,  this Court  reiterated that in order to attract excise duty,  the article  manufactured  must be capable of being  sold  to  a consumer. Entry 84 of List I of Schedule VII to the  Consti- tution specifically speaks of "duty of excise on tobacco  or other goods manufactured or produced in India" and it is now well accepted that excise duty is an indirect tax, in  which the  burden of the imposition is passed on to  the  ultimate consumer. This Court held that in that context, the  expres- sion "goods manufactured or produced" must refer to articles which 791 are capable of being sold to a consumer. To become  "goods", an  article must be something which can ordinarily  come  to the  market to be bought and sold. The Court found  in  that case that aluminium cans prepared by the appellants  therein were  employed entirely by it in the manufacture  of  flash- lights and were not sold as aluminium cans in the market. It also  appeared from the records that aluminium cans  at  the point of levy of excise duty existed in a crude and  elemen- tary form which were incapable of being employed as a compo- nent in a flashlight. These cans had sharp uneven edges  and in  order  to use them as a component in  making  flashlight cans,  these cans had to undergo various processes  such  as trimming,  threading  and redrawing. After that  these  were reeded, beaded and anodized or painted, it was at that point only  that  these  became distinct  and  complete  component capable of being used as flashlight cans for housing battery cells and having a bulb fitted to the can. This Court  noted that  it  was difficult to believe that the  elementary  and unfurnished  form in which these existed  immediately  after extrusion sufficed to attract a market. The assertion of the appellant  on affidavit that aluminium cans were unknown  in that form in the market had not been proved to the  contrary by  any  satisfactory material by the  respondents  therein. This Court further found that not a single instance had been provided by the respondents domenstrating that such alumini- um  cans had a market. The conduct of the appellants in  the past, having regard to the circumstances of the case,  would

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not serve as evidence of the marketability of the  aluminium cans,  it  was in that case. This Court  noted  that  record disclosed that whatever aluminium cans were produced by  the appellants were subsequently developed by it into a complet- ed and perfected component for being employed as  flashlight cans. In those circumstances, the aluminium cans produced by the appellants were not liable to excise duty under  section 3 of the Act read with Item 27 of the Central Excise Tariff.     In the case of Bhor Industries Ltd., Bombay v. Collector of Central Excise, Bombay, [1989] 1 SCC 602, this Court  had to deal with the liability to duty on intermediate  products and  it was reiterated that liability to excise duty  arises only when there is manufacture of goods which is  marketable or  capable of being marketed. It was held that excise is  a duty  on  goods as specified in the  Schedule.  The  taxable event  in  the case of excise duties is the  manufacture  of goods.  Under the Act, in order to be goods as specified  in the Entry, it was essential that as a result of  manufacture goods  must come into existence. For articles to  be  goods, these  must be known in the market as such or these must  be capable of being sold in the market as goods. Actual sale 792 is  not  necessary. User in the captive consumption  is  not determinative but the articles must be capable of being sold in the market or known in the market as goods. It is, there- fore, necessary to find out whether these are goods, that is to say, articles as known in the market as separate distinct identifiable commodities and whether the tariff duty  levied would be as specified in the Schedule. Marketability, there- fore,  is  an essential ingredient in order to  be  dutiable under  the Schedule to Central Excise Tariff Act,  1985.  In that case, the Court found that crude PVC firms as  produced by the appellant were not known in the market and could  not be sold in the market and was not capable of being  marketa- ble.  The Court further reiterated that it was the  duty  of the revenue to adduce evidence or proof that the articles in question  were goods. The Tribunal went wrong, it was  held, in  not applying the test of marketability. There  being  no contrary evidence found by the Tribunal in that case, it was held  that in those circumstances, no excise duty should  be charged.     It  is in this light, therefore, that the evidence  dis- cussed  by the Tribunal in this case, have to be  viewed  in order  to test the validity of the order impugned. The  case of  the respondent had always been that  starch  hydrolysate was not being marketed and is not capable of being  marketed in  view of its highly unstable character resulting in  fer- mentation  even if kept for a day or two. Shri  Ganguly  ap- pearing for the revenue sought to urge that the Tribunal was wrong in approaching the problem in that light. The test was not  whether  the  starch hydrolysate was not  of  a  highly unstable  character and resulted in fermentation even  in  a day or two, but whether it was capable of being  marketable. He submitted that the test applied was not the true test. He urged  that even transient items of articles can  be  goods, provided that these were known in the market as distinct and separate  articles  having distinctive  and  separate  uses, these  would  still become goods if these  were  capable  of being  marketed even during short period. From a  conceptual and  jurisprudential point of view, Shri Ganguly  is  right. But we are concerned with the question whether actual  goods in question were marketed or, in other words, if not, wheth- er  these are marketable or not. It is true that  the  goods with  unstable character can be theoretically marketable  if there was a market of such transient type of articles  which

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are  goods.  But one has to take a practical  approach.  The assessee  produced  evidence in the form of  affidavit.  One Shri Khandot. who filed an affidavit in support of the  case of  the  respondent, had stated in his affidavit  that  com- pletely hydrolysed starch would start fermenting and  decom- posin  and at higher concentration it would start crystaliz- ing out within two or three days. This is evidence indicat- 793 ing  propensity of its not being marketed. It is  good  evi- dence  to come to this conclusion that it would be  unlikely to  be marketable as it was highly unstable. There was  evi- dence as noted by the Tribunal that it has not been marketed by anyone. There is also an admission of the  Superintendent of the appellant that no enquiry whatsoever was conducted by the  Department  as to whether starch hydrolysate  was  ever marketed by anybody. It was pointed out by the revenue  that even according to the respondent, it stored starch  hydroly- sate  in  tanks  before transporting it  through  pipes  but according  to the appellant, the storage of starch  hydroly- sate was only for a period of a few hours only as a step  in the process of transfer thereof to sorbitol. It,  therefore, appears  to  us  that there was  substantial  evidence  that having  regard  to  the nature of the goods  that  this  was unlikely  that the goods in question were  marketable.  This should be judged in the background of the evidence that  the goods have not been marketed in a pregmatic manner. All this again would have to be judged in the light of the fact  that revenue has not adduced-any evidence whatsoever though asked to  do so. It was pointed out that if the Department was  to charge duty of excise on this starch hydrolysate as one form of  glucose  it  would be the burden on  the  Department  to establish that starch hydrolysate was not merely  marketable but  was being marketed as glucose in some form. This  would be so since what is liable for duty under item E is  glucose in  any form and, therefore, in order to demand  duty  under that section, the Department must establish that the product on  which duty was demanded was known in the market as  glu- cose in one form or the other. There .is no such evidence as observed  by  the Tribunal. The Tribunal noted and,  in  our opinion,  rightly that revenue cannot be said to  have  dis- charged  its  burden of establishing that  by  applying  the process  of  hydrolysis to starch for production  of  starch hydrolysate the respondent manufacturers any excisable goods in  the sense of being goods known in the market  and  being marketed  or  marketable.  Our attention was  drawn  to  the affidavit  of  Shri P.D. Khander, Chemist,  who was  a  Food Technologist and was holding a degree of B.Sc.  (Chemistry). He was carrying on business of dealing in glucose. He stated in his affidavit as follows:                      . " 14. I have been the starch hydroly-               sate  made  by Sarabhai M.  Chemicals.  It  is               completely  hydrolysed starch. It  appears  as               aqueous  syrup containing about  66-71%  reduc               ing  sugars expressed as Dextrose. It is  nei-               ther  glucose or        dextrose in  any  form               nor   glucose  in  liquid  state  nor   liquid               glucose.  In order to find out the market  for               completely        hydrolysed starch as is made               in Sarabhai M. Chemicals, at               794               their  instance, I had made  trade  inquiries.               However,  there  is no market  for  such  sub-               stance. Since it can act only as an intermedi-               ate  product for the manufacture of  Sorbitol.               Dextrose  or  Glucose and Fructose  and  every

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             manufacturer  of Glucose,  Dextrose,  Sorbitol               and  Fructose  would have his  own  plant  for               hydrolysing  starch, it is commercially not  a               viable  proposition both the manufacturers  of               Glucose, Dextrose, Sorbitol or Fructose or the               persons undertaking the process of hydrolysing               starch either to purchase completely  hydroly-               sed  starch from the market or sell or  under-               take  process  of hydrolysing starch  for  the               purpose  of  sale in the  market,  because  at               lower concentration, starch which is complete-               ly  hydrolysed  would  start  fermenting   and               decomposing. At higher concentration, it would               start  crystallising out within two  or  three               days."     This  affidavit  evidence remains  uncontradicted-  Shri Ganguly,  however,  drew our attention to an  order  of  the Tribunal in M/s. Anil Starch Products Ltd., Ahmedabad v. The Collector  of  Central Excise, Ahmedabad  being  Appeal  No. ED(SB)(T)  1534/81-D arising out of the Revision  Order  No. 820/81.  He referred to the observations at page 117 of  the Paper Book which dealt with the evidence of one Shri Khabho- lia, where, according to Shri Ganguly, the Tribunal came  to a different conclusion. But the Tribunal in that case relied on  the decision of the Allahabad High Court in the case  of Union  of India v. Union Carbide India Ltd., [1978]  ELT  1. There  the  Allahabad High Court held that things  would  be nevertheless goods even these did not have a general market, where  they  can be easily bought and sold. The  High  Court hold  that the fact that products might not be known to  the general public or to the traders in general would not change the  position  and therefore the test did not appear  to  be sound.  This decision of the Allahabad High Court which  was relied  upon by the Tribunal was set aside by this Court  in Appeal  in the case of Union Carbide India Ltd. v. Union  of India  & Ors. (supra). In view of the test laid down and  in view  of the evidence discussed, it is difficult to  sustain the  order of the Tribunal. In this connection,  it  appears that  there was no market enquiry by the Revenue.  Reference may be made to the crossexamination of Shri Shukla, Superin- tendent (Central Excise) by Shri Nanawati as appears at  pp. 235-237 of the present paper book. In view of the fact  that there  was  positive evidence that  starch  hydrolysate  was never marketed and in view of further fact that in the light of  the  nature of the goods being highly  unstable,  it  is highly  improbable  that  the goods were  capable  of  being marketed and there being in spite of 795 the  opportunities,  no evidence produced at  all  that  the goods,  in  fact, were capable of being marketable,  in  our opinion, it must be held as did the Tribunal that the starch hydrolysate were not dutiable under the Act.     In the premises, the revenue has failed to discharge its onus  to prove that starch hydrolysate was dutiable. In  the premises, the Tribunal cannot be said to have committed  any error. The appeal must, therefore, fail and is, accordingly, dismissed.  In the facts and the circumstances of the  case, there will, however, be no orders as to costs. R.S.S.                                          Appeal  dis- missed. 796