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TMI Blog1991 (4) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... third appeal were asked to take out a Central Excise because for the manufacture of these goods which were held to be classifiable under Item 68 of the erstwhile Central Excise Tariff - an order which was set aside by Collector (Appeals). On rejection of their refund claim, they appealed to the Collector of Central Excise (Appeals), Madras who allowed their appeal and decided that oleoresins were entitled to the benefit of exemption under Notification 115/75. Hence the departments appeal to the Tribunal in all the three cases. 3. It is necessary to examine Notification 115/75 which is reproduced below:- (both under the new Tariff as well as under the old Tariff) Exemption to goods manufactured in factories covered by specified industries - In exercise of the powers conferred by Rule 8(1) of the Central Excise Rules, 1944, the Central Government hereby exempts goods falling under Item No. 68 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944), manufactured in factories covered by any of the industries specified in the Schedule hereto annexed, from the whole of the duty of excise leviable thereon : THE SCHEDULE 1. Coir Industry. 2. Cashew Indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecific words oil mill take the colour of specific words thereby the meaning of solvent extraction is restricted to that of one connected with oil mill. Hence, goods of any solvent extraction industry not connected with oil mill cannot be exteneded the benefit of Notification 115/75 as amended. 8. In a company law case, the House of Lords while interpreting the words to carry on the business of mechanical engineers and general contractors as appearing in a memorandum of association, observed that the generality of the expression general contractors was limited by the previous words mechanical Engineers and that it ought to be confined to the making of contracts connected with that business. [Ashbury Railway Carriage and iron Co., v. Riche - (1875) L.R. 7 H.L. 653]. Similarly, in this case the generality of the expression solvent extraction , which is a process generally employed to obtain finished products, is restricted to mean such process carried on in oil mill. 9. Among the additional grounds taken in all the appeals is that the term Oleoresins refers to a natural combination of resins and essential oils occurring in or exuded from plants and is distinct from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s :- Solvent extraction in general implies removal of soluble material from an insoluble solid phase by dissolution in a liquid solvent... Solvent extraction, as applied to the oil industry, involves the leaching of oil from an oil bearing seed or cake specially prepared for efficient extraction, by a hydrocarbon solvent, generally n-hexane. Groundnut oil cake, rice bran and soyabean are specially amenable to such treatment. 13. Explaining the term industry Smt. Zutshi referred to its definition as given in Black s Law Dictionary (Fifth Edition 1979) which is reproduced below :- Industry. - Any department or branch of art, occupation, or business conducted as a means of livelihood or for profit; especially, one which employs much labour and capital and is a distinct branch of trade. 14. Smt. Zutshi then raised a question whether it was correct to regard the solvent extraction method as an industry and answered it by saying that it was only a method of extraction of solvents. She submitted that Serial No. 4 of the notification did not contemplate two industries - viz. (a) the oil mill industry (b) the solvent extraction industry. On the question of interpretation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1990 (50) E.L.T. 468] and stated that this decision lays down the guidelines for the interpretation of Notification 115/75 although it does not directly deal with oleoresins. 18. Countering the arguments of Smt. Zutshi, Shri Joseph Vellapally, Senior Advocate assisted by Shri Sudhir Gopi, Advocate, stated that although Serial No. 3 of the notification refers to the tanning industry, it is well known that tanning is only a process and not an industry. He also submitted that the word industry has been used in the body of the notification itself and therefore the interpretation would be that solvent extraction technique is also included in the entry. The logic for this argument was that excepting for the tanning industry which is animal-based, the remaining five are products of the agricultural industry. He explained that it was a composite notification where the raw materials of both the agricultural and animal world were exempted. 19. Referring to the reliance placed by the appellants on the ejusdem generis rule, Shri Vellapally contested the claim on the ground that for this rule to be applicable, more than one example of the species must find place in the expression to con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t that the first expression would limit the scope of exemption to the oil mill industry and, solvent extraction method being one of the methods used in the oil industry, the exemption would be applicable to oil mills employing the solvent extraction method even when the words are not used in the entry. As regards the second expression, we have to see whether the addition of the words solvent extraction has the effect of enlarging the scope of exemption to cover the respondents cases. We have to now take note of the argument that solvent extraction is not an industry by itself but only a process or technique of oil milling. Could it then be said that the use of the words solvent extraction was redundant in the notification and no new meaning should be read into it? It would only be appropriate to interpret the words solvent extraction in the context in which they have been used and, while keeping this aspect in mind, we cannot overlook the fact that solvent extraction method would have reference to the oil mill industry. Whether we accept the ejusdem generis principle of interpretation or not, the context in which the words have been used cannot be disregarded. Again, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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