Per K.S. Venkataramani : The appellants herein manufacture various bulk drugs including Mebendazole during the manufacture of which a substance known as 3-4 Diamine) Benzophenone (DABP) emerges as an intermediate product. The jurisdictional Assistant Collector of "Central Excise, Kalyan Division off Bombay-Ill Collectorale by his order dated 26.5.87 held that DABP at intermediate stage is classifiable as other organic compound under Sub-heading 2913.00 Central Excise Tariff Act. He overruled the appellants contention that at that stage DABP is in crude form and not goods at all since it is not marketable at crude stage. They had also in this regard produced an affidavit from one Dr. R. Maheshwari who said that crude DABP is different from purified DABP and that DABP in its crude form which is used for captive consumption in manufacture of Mebendazole is a product which cannot be bought and sold in the market. The Assistant Collector in repelling these contentions invoked Rule 2 of the Rules for the interpretation of the Tariff which lays down that when a product has the essential character of the finished product it should be classified under the same heading. The Assistant Collector found that the Rule is attracted in the case of crude DABP vis-a-vis DABP that is ???The Assistant Collector'' s order was upheld by the Collector of Central Excise Appeals), Bombay in his impugned order dated 7.12.88 against which the present appeal has been filed.

2. The learned Consultant Shri Sunder Rajan for the appellants contended that the appellants have consistently claimed with expert's evidence in the shape of Dr. Maheshwari's affidavit that DABP captively consumed is incrude form and is not marketable. It is only the DABP which is taken out from the stream of manufacture and is subject to further process of purification that can be sold in the market. Dr. Maheshwari had stated in the affidavit that such DABP which is of 92 to 95% purity is not saleable in the market. Purity of saleable DABP is 98.5%. Learned Counsel urged that the Department has not discharged the onus cast on it to show, in the face of evidence led by the appellant, that DABP captively consumed is marketable. Learned Constant relied upon Supreme Court observations in Paras 10 and 11 of its decision in the case of Moti Laminates Pvt. Ltd. Vs. Collector of Central Excise Ahmedabad, reported in 1995 (76) E.L.T. 241 (S.C.) to say that the presumption that any goods produced or manufactured if captively consumed satisfied the test of marketability is a rebuttable presumption, and can be rebutted it is established that the article produced and captively consumed was neither goods nor marketable nor capable of being marketed. Even in respect of goods specified in the tariff, the Supreme Court held, it could be established that itwas not marketable or capable of being marketed, therefore, no duty was leviable on it. The learned Consultant also relied upon the Tribunal majority decision in the case of T.I.S.C.O. Vs. Collector of Central Excise, Jamshedpur, reported in 199S (76) E.L.T. 602 (Tribunal) that marketability is essential for determining durabiliity of any article and that specific entry in the tariff covering that article by itself is not conclusive.

3. Learned Departmental Representative Shri J .P. Singh argued that as has been found by the Assistant Collector the chemical formula and molecular structure of DABP at intermediate stage and that which is sold is the same and also DABP captively consumed has the essential characteristics of the D APB that is marketed. The process is only one of purification which does not change the essential characteristics of DABP.

4. On a consideration of the submissions made by both the sides it is seen that the question to be decided is whether Diamine) Benzophenone (DABP) emerging as an intermediate product in the course of manufacture of Mebendozole, a bulk drug, is dutiable or not. The appellants have pleaded that DABP as it