9911796707
TMI Blog1986 (7) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... rine esters of fatty acids. The word "oil" is used for trigylcerides that are liquid at ambient temperatures. Apart from the physical appearance, there is no distinction between oil and hydrogenated oil and the hydrogenated oil still retains the characteristics of oil even after hardening. Prior to April, 1978, petitioner No. 1 was classifying the hardened vegetable oil for the purpose of levy of excise duty as falling under Tariff Item No. 13. Tariff Item No. 13 reads as under : "Item No. 13 - VEGETABLE PRODUCTS Item No. Tariff Description Rate of Duty 1. 2. 3. 13. Vegetable Product - "Vegetable Product" means any vegetable oil or fat which, whether by itself or in admixture with any other substance, has by hydrogenation or by any other process been hardened for human consumption." 10% ad valorem The petitioners felt that the classification under Tariff Item No. 3 was not accurate and the hardened vegetable oil would fall within the ambit of Tariff Item No. 12. Tariff Item No. 12 reads as under : "Item No. 12 - VEGETABLE NON-ESSENTIAL OILS Item No. Tariff Description ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nated oils are classifiable under Item No. 68. The order of the revisional authority is under challenge in this petition. 5. Shri Wahanvati, learned Counsel appearing on behalf of the petitioners, submitted that the revisional authority was in error in disturbing the order of the Appellate Collector for more than one reason. The learned Counsel urged that the revisional authority could not have exercised powers under Section 36 as a period of six months had expired from the date of order of the Appellate Collector at the time of issue of show cause notice. Apart from the contention that the revisional proceedings were barred by limitation, even on merits, says the learned Counsel, the order is wholly unsustainable. Shri Wahanvati argued that the material on record was more than enough to establish that the product of the petitioners clearly falls under Tariff Item No. 12. The first submission of the learned Counsel that the proceedings commenced by the revisional authority was barred by limitation is not accurate. As mentioned hereinabove, the Appellate Collector passed the order on March 20, 1980, while the show cause notice under Section 56(2) of the Act was issued on October 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and not for human consumption and, therefore, the Tariff Item No. 13 could not have been attracted. The question which then remains for determination is whether Tariff Item No. 12 or Tariff Item No. 68 would be applicable to the products manufactured by the petitioners. It is now well-settled that resort cannot be made to residuary article as long as the product manufactured comes within the ambit of any other tariff item. It is necessary, therefore, to ascertain whether Tariff Item No. 12 is applicable for levy of excise duty in respect of hardened vegetable oil. Shri Wahanvati submits and, in my judgment, with considerable merit that Tariff Item No. 12 brings in its sweep vegetable non-essential oils of all sorts and the expression "all sorts" would bring in its ambit hydrogenated oil. Shri Wahanvati submits that there is hardly any distinction between vegetable oil in liquid form and the hydrogenated oil which is hardened with a melting point higher than 41°C. Apart from the distinction in the physical appearance, there is no distinction between oil and hydrogenated oil. The submission of Shri Wahanvati is well supported by the decision of the Supreme Court in Tungabhadra's case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ened oils with melting point above 45°C would be recognised as commodity distinct from vegetable oil. Shri Wahanvati complains that this observation was made by the revisional authority in the case of Hindustan Lever without any material whatsoever on record. The learned Counsel urged that the revisional order does not reflect as to what was the material on which the conclusion could have been recorded that in the trade, the hardened oil is known as a commodity distinct from vegetable oil. I enquired from Shri Rege, learned Counsel appearing on behalf of the respondents, as to whether there is any material to establish that fact and Shri Rege very fairly stated that there is none. It is obvious that the revisional authority while passing the order in the case of Hindustan Lever had ignored the relevant facts and has proceeded on assumption which was totally unfounded. The revisional authority was clearly wrong in ignoring the judgment of the Supreme Court in Tungabhadra's case on untenable ground. While dealing with the case of the present petitioners, the revisional authority merely observed that the Government had already held in the case of Hindustan Lever that hydrogenated oi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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