Edible oil classification turns on essential character, with solvent extracted oil treated as non-refined edible oil.

Solvent extracted oil sold to vanaspati manufacturing or refining units is analysed by reference to its nature, use and the control orders governing its sale. The commentary states that the oil remains commercially and legally identifiable as edible oil, because edible oil includes both refined and non-refined forms and further refining does not change its essential character. It also notes that the oil extracted from oil cake retains the identity of the original oil, with processing removing impurities rather than creating a new commodity. On that basis, the relevant tax entry is said to cover solvent extracted oil as non-refined edible oil rather than as non-edible oil.

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Issues: Whether solvent extracted oil sold to vanaspati manufacturing units or refining units falls within the category of edible oil and is therefore assessable as non-refined edible oil under the Karnataka Sales Tax Act.

Analysis: The classification turned on the nature and use of the commodity, the statutory control orders governing solvent extracted oil, and the commercial understanding of edible oil. The Court noted that the control regime recognised solvent extracted oil as oil that could not be sold for direct human consumption unless refined, but that refinement did not alter its basic character. It further held that edible oil is a genus that includes both refined and non-refined oils, and that the legislative scheme did not indicate any intention to exclude solvent extracted oil merely because it required further refining before human consumption. The oil extracted from oil cake retained the essential identity of the original oil, with only impurities being removed by processing.

Conclusion: Solvent extracted oil was held to be edible oil within the relevant tax entry and not liable to be treated as non-edible oil for higher taxation.

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