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TMI Blog2013 (9) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... "The sample as received is in the form of yellowish brown clear free flowing oily liquid having huoresence. It is essentially composed of mineral hydrocarbon more than 70% by weight and having the following characteristics :- 1. Ash : 0.02% by weight 2. Inorganic acidity : Nil 3. Water content : Nil 4. Sediment : Nil 5. Flash point : More than 94°C 6. Kinematics viscosity at 50°C : 61.55 est 7. Density at 15°C : 0.8816 lm/CM3 8. Test for glycolic bodies : Negative On the basis of the above finding, the product under reference does not appear to be recycled. Its actual use may be ascertained." 3. On the above basis, Revenue entertained a view that the base oil imported by the appellant was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aracteristics of base oils (virgin/recycled) differed from refinery to refinery depending upon the process deployed for refining of crude/used oils and the quality of base stocks or used oils (basic raw material for refinery) which were at variance in the world from region to region; that in certain cases recycled base oils might be even better in quality/colour than virgin base oils if modern hydrotreating process was used for re-refining; that automobile spent lube oils, used for producing recycled base oils, were cheaper in certain countries compared to crude oils and because of the same, recycled base oils were available at lower prices in the world market. The appellants further submit that the re-refined (recycled) base oil was used f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue reiterated the conclusion arrived at by lower authorities wherein he has observed that though the appellant has produced certain literature/printout of the used oil/HHW Conference held in California in 2005 to substantiate their claim that the product imported by them was nothing but recycled base oil, they have not submitted any technical literature or authentic evidence to prove their claim. As such by referring to various decisions, Commissioner (Appeals) has observed that test report of chemical examiner, unless demonstrated to be erroneous, cannot be lightly brushed aside on the basis of above finding of private persons and the same has to be preferred. As such prays the ld. DR that the appeal filed by the appellant be rejected. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to as mineral base oil. When additives are added in small quantities it can significantly improve the properties, i.e., structural, rhcological, lubrication and chemical properties etc. Since therefore base as such is a general term, unless otherwise specific no specifications are available or can be made available. Question 2 : When there is no specification, how can you decide that the goods are re-cycled base oil or virgin base oil? Ans : Since the samples as received were clear, free flowing liquids with inorganic acidity, water content and sediment as "nil and ash also was found to be almost nil or less than 0.1%. Further, flycolic bodies test was also found negative in each case, which is being used as anti-freeze in used lubr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has to be inferred that the samples did not appear to be recycled oil. 13. We note that the above observations of the lower authorities are in the arena of assumption and presumption. The observations made by chemical examiner in his report as also at the time of cross examination clearly shows that the conclusion arrived at by him is not a positive finding of fact but a doubt about the oil being recycled or not? We have also examined the invoice of foreign supplier which refers to the product as recycled base oil. Similarly packing list issued by foreign supplier refers to the product as recycled base oil is packed in old drums. Certificate by original foreign supplier also described the goods as recycled base oil. Revenue has not produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed oil can be equivalent to virgin oil standards, thus making it difficult even for the chemical examiner to arrive at a conclusive finding, especially in the absence of admitted laid down characteristics of both. As such, we are of the view that the sole reliance on the half-hearted report of the chemical examiner, read with his cross examination and in the absence of rebuttal of declaration made by foreign supplier in various documents, is unjustified and cannot be made the basis for holding against the appellant. 17. In view of the foregoing discussions, we are of the view that the Revenue has failed to establish beyond doubt that the oil imported by the appellant was virgin oil so as to enhance the assessable value of same. We accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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