Motor spirit classification requires proof of spark-ignition fuel suitability, so captive consumption exemption remained available.

Intermediate distillates are not classifiable as motor spirit under chapter sub-heading 2710.13 unless the department proves, by reliable evidence, that they are suitable for use as fuel in a spark ignition engine in addition to satisfying the prescribed flash point criterion. A laboratory report stated that the goods were not suitable for use alone or in admixture with permissible additives, and that finding was not dislodged by contrary independent evidence. On that basis, the goods could not be treated as motor spirit, and captive consumption exemption under Notification No. 67/95-C.E. was not denied.

---

---

Issues: Whether the intermediate distillates were classifiable under chapter sub-heading 2710.13 as motor spirit and, if so, whether they were outside the scope of Notification No. 67/95-C.E. for captive consumption.

Analysis: The earlier remand had required the department to establish not only the flash point criterion but also suitability for use as fuel in a spark ignition engine. On remand, the samples were tested by HPCL, which reported that the products were not suitable for use as fuel by themselves and also not in admixture with permissible additives. The department did not dislodge that report by any contrary independent evidence and also failed to establish that the cited comparable goods were truly comparable on the basis of test results or marketability as motor spirit. In the absence of evidence satisfying the second essential criterion, the goods could not be treated as motor spirit under chapter sub-heading 2710.13.

Conclusion: The intermediate products were not classifiable under chapter sub-heading 2710.13, and the exemption under Notification No. 67/95-C.E. was not denied; the Revenue's appeals failed.

Ratio Decidendi: Classification as motor spirit requires proof of suitability for use as fuel in a spark ignition engine in addition to the other prescribed criterion, and that burden must be discharged by reliable evidence.

---