2005 (12) TMI 368 - AT - Central Excise

Summary

Issues:
1. Appeal against Order in Appeal dated 9-10-2003.
2. Confirming demands for cess and penalty.
3. Interpretation of Notification No. GSR 882(E) dated 8-12-1993.
4. Definition of vegetable oil and leviability of cess on oxidized vegetable oil.
5. Interpretation of the word "processing" in the context of vegetable oil production.

Analysis:

1. The appeals were filed against an Order in Appeal dated 9-10-2003, which disposed of multiple appeals through a common order. The issue revolved around confirming demands for cess and penalties imposed by the Central Excise Department from July 1999 to March 2002.

2. The main contention was whether oxidized vegetable oil is liable for cess as per Notification No. GSR 882(E) dated 8-12-1993. The appellants argued that the oil they produced did not fall within the definition of vegetable oil as per the National Oil Seeds & Vegetable Oils Development Board Act, emphasizing that their process did not involve oil seeds or oil-bearing plant materials.

3. The Commissioner (Appeals) relied on precedents, including the case of M/s. Coromandal Agro Products v. Collector of Central Excise, to support the interpretation that vegetable oil encompasses all oils produced from oil seeds or plant-origin materials. The Commissioner upheld the demands based on this interpretation.

4. The appellants cited legal decisions such as M/s. Bhasir Oil Mills v. Union of India and A.P. Rice Bran Solvent Extractors Association v. Union of India to argue that their oxidized vegetable oil, subjected to further processing, did not fit the definition of vegetable oil for cess collection purposes.

5. Following the legal precedents and the argument that the appellants' product did not meet the criteria for vegetable oil under the relevant Acts, the Tribunal concluded that the appellants were not liable to pay the cess. The impugned order was set aside, and the appeal was allowed in favor of the appellants.

In conclusion, the Tribunal's judgment favored the appellants by considering the specific process and composition of the oxidized vegetable oil in question, ultimately determining that it did not fall within the definition of vegetable oil for cess collection purposes as outlined in the relevant legal provisions and precedents.