1992 (12) TMI 146 - AT - Central Excise

Summary

Issues:
1. Classification of hydrogenated Castor Oil and Blown Castor Oil under Central Excise Tariff.
2. Whether hydrogenation and blowing processes change the essential properties of the oils, leading to a new classification under Item 68.

Analysis:
1. The appeal concerns the classification of hydrogenated Castor Oil and Blown Castor Oil under the Central Excise Tariff. The Collector of Central Excise, Bombay III challenged the order of the Collector (Appeals) classifying the oils under Item 12 instead of the residuary Item 68. The Collector (Appeals) upheld the classification under Item 12, rejecting the Department's argument for classification under Item 68.

2. The main contention revolves around whether the hydrogenation and blowing processes result in a new commodity distinct from the original oils. The appellant argues that hydrogenated Castor Oil is a new commodity known as "hardened Castor Oil," distinct from its raw form. They claim that the expression "Vegetable non-essential oils - All sorts" in Tariff Item 12 does not cover Hydrogenated Castor Oil. The appellant also highlights that the decision in a previous case is under challenge in the Supreme Court, questioning the validity of relying on it.

3. Regarding Blown Castor Oil, it is argued that the Chemical Examiner reported it as chemically and physically different from Castor Oil, falling outside the scope of Item 12. Reference is made to the separate classification of hydrogenated oxidized oils under the new Central Excise Tariff.

4. The definition of Blown Oil from authoritative publications is cited to support the argument that blowing causes oxidation, leading to a chemical change and the creation of a new product. The appellant contends that Blown Castor Oil should be classified under Item 68, supported by a Supreme Court decision.

5. The respondent presents a different perspective, citing Bailey's Industrial Oil and Fat Products to explain blown or oxidized oils. They argue that the essential properties of the oils do not change significantly through the blowing process, supporting their classification under Item 12. Reference is made to previous Tribunal decisions supporting this stance.

6. After careful consideration, the Tribunal notes that the Supreme Court has previously held that if essential properties of the oil remain unchanged, it should be classified under Item 12. The Tribunal emphasizes that unless a new commodity with altered properties emerges, classification under the residuary item (Item 68) is not warranted. Technical evidence suggests that Blown Castor Oil retains its essential properties as a vegetable non-essential oil, thus justifying classification under Item 12.

7. The Tribunal refers to previous decisions to clarify that the scope of Tariff Item 12 covers hydrogenated oils that retain their essential characteristics. The Tribunal rejects the argument that Item 12 should be limited to oils in their natural state, emphasizing that no evidence suggests the previous Tribunal decisions have been overturned by the Supreme Court.

8. In conclusion, the Tribunal rejects the appeal, maintaining the classification of both hydrogenated Castor Oil and Blown Castor Oil under Item 12 of the Central Excise Tariff. The decision is based on the premise that the essential properties of the oils remain unchanged, warranting their classification under the specific tariff item rather than the residuary category.