1980 (7) TMI 108 - CGOVT - Central Excise

Summary

Issues:
1. Interpretation of the term 'food products and food preparations' under a notification for exemption from duty.
2. Application of commercial parlance in determining whether certain goods qualify as food products.
3. Consideration of the Food Adulteration Act in determining the classification of goods as food products.
4. Discrepancy in treatment of similar goods by different authorities under the same notification.

Analysis:
1. The case involved the petitioners manufacturing 'Food flavours and Food colour preparations' seeking exemption from duty under a notification. The Assistant Collector rejected the claim, stating the goods did not qualify as food products or food preparations under the notification. The Appellate Collector upheld this decision. The petitioners argued that their goods should be exempt as they enhance the flavor of other foods and are considered food preparations under the Prevention of Food Adulteration Act.

2. The Government considered the absence of a specific definition for 'food products and food preparations' in the notification. Referring to legal precedent, the judgment highlighted the importance of context and background in interpreting the term 'food.' The goods in question were deemed ineligible for exemption as they could not be consumed directly by a normal human being, aligning with the observations made by the court regarding the interpretation of taxing statutes.

3. The judgment emphasized that the wide scope of the term 'food' under the Food Adulteration Act was relevant only within the context of that Act. The court rejected the petitioner's reliance on the Act to support their claim for exemption under the notification.

4. Addressing the discrepancy in treatment of similar goods by different authorities, the Government endorsed the order to all relevant authorities to ensure consistent application of the law. The petitioners' claim of discrimination based on the treatment of their competitors was dismissed, and the revision application was rejected based on the detailed order passed by the Appellate Collector.

This judgment clarifies the interpretation of terms in a notification for duty exemption, the significance of commercial parlance in determining the classification of goods, and the limited applicability of other statutes in such determinations. It also underscores the importance of consistency in decision-making across authorities to prevent discrimination and ensure fair treatment under the law.