Octroi classification of rectified spirit as raw material falls under the residuary entry, not food, drink, or industrial spirit entries.

Rectified spirit imported as a raw material for manufacture of IMFL was held not to fall within Entry 7 of Class I, which covered goods used as food or drink, or Entry 37 of Class III, which covered methylated, denatured and industrial spirits used for fuel, lighting, washing or similar industrial use. As the spirit was neither potable liquor nor a commodity for direct use at the octroi stage, its classification turned on the residuary entry. The proper classification was Entry 86 of Class IX, attracting octroi at 2%, and the respondent was entitled to recover the differential duty.

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Issues: Whether rectified spirit imported for use as a raw material in the manufacture of IMFL fell under Entry 7 of Class I, Entry 37 of Class III, or the residuary Entry 86 of Class IX of the Schedule to the octroi rules.

Analysis: Octroi is attracted on the goods as imported into the local area and their intended direct use at that stage. Rectified spirit imported by the appellant was not potable liquor and was not fit for direct use as food or drink. Entry 7 of Class I, read in the context of articles used for food or drink by men or animals and the associated items of wine, beer and similar consumables, did not embrace rectified spirit. Entry 37 of Class III, dealing with methylated and denatured spirits and industrial alcohols used for fuel, lighting, washing and industrial use, also did not cover a raw industrial input such as rectified spirit brought in for further manufacture. The proper classification, therefore, was the residuary entry.

Conclusion: Rectified spirit was not classifiable under Entry 7 or Entry 37 and was liable only under the residuary Entry 86 at 2% octroi, with the respondent entitled to recover the differential duty.

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