Popular parlance test kept condensed skimmed milk within the excise exemption, setting aside the duty demand.

Condensed skimmed milk was held to fall outside Item 13 of Notification No. G.S.R. 339 of 1 March 1970, because excise classifications must be read in their popular and common parlance sense. The Court treated condensed milk and condensed skimmed milk as distinct preparations and read Item 13 as referring to condensed milk made from full cream milk, not skimmed milk. Separate references in licences or price lists did not expand the notification's scope. The exemption under Item 1B therefore continued to apply, and the excise demand on condensed skimmed milk was set aside.

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Issues: Whether condensed skimmed milk fell within Item 13 of Notification No. G.S.R. 339 dated 1st March, 1970 as "condensed milk, whether sweetened or not", or remained covered by the exemption granted to prepared or preserved foods under Item 1B of the First Schedule to the Central Excises and Salt Act, 1944.

Analysis: For levy of excise duty, the description of goods must be understood in their popular and common parlance sense. Condensed milk and condensed skimmed milk are different milk preparations, and the materials relied upon showed that skimmed milk is distinct from full cream milk. The notification's own structure, read with the excise handbook entries and the label descriptions in Rule 42 of the Prevention of Food Adulteration Rules, 1955, indicated that Item 13 was directed to condensed milk prepared from full cream milk and not to condensed skimmed milk. The fact that a manufacturing licence or price list referred separately to condensed full cream milk and condensed skimmed milk did not alter the scope of the exemption notification.

Conclusion: Condensed skimmed milk was not excluded by Item 13 and continued to enjoy exemption under the notification; the demand of excise duty could not be enforced.

Final Conclusion: The appeal succeeded and the excise demand on condensed skimmed milk was set aside.

Ratio Decidendi: In interpreting an excise exemption or tariff entry, the goods must be classified according to their popular and common understanding, and a specific exclusion will not be extended beyond the ordinary meaning of the words used.

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