Commercial parlance test in excise classification placed hardened edible oils under the residuary tariff entry.

Hardened groundnut and cotton seed oils unfit for human consumption were held not to fall within Tariff Item 13, because that entry covered vegetable products, meaning vegetable oils or fats hardened for human consumption. They also did not fall under Tariff Item 12, since in trade and commerce such hardened oils were understood as a distinct commodity with a different name, character and use. Applying the commercial parlance test in tax classification, and finding no specific entry that covered them, the residuary Tariff Item 68 was the appropriate classification.

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Issues: Whether hardened groundnut and cotton seed oils, unfit for human consumption, were classifiable under Tariff Item 13, Tariff Item 12, or the residuary Tariff Item 68 of the Central Excise Tariff.

Analysis: Tariff Item 13 covered vegetable products, meaning vegetable oils or fats hardened for human consumption. The goods in question had a melting point above 45 C and were supported by material showing that such hardened oils were unfit for human consumption. They therefore did not answer the statutory description of vegetable products under Tariff Item 13. The claim that they should fall under Tariff Item 12 also failed because, in trade and commerce, hardened oils of this kind were regarded as a commodity distinct from ordinary vegetable oils, having a different name, character and use. In taxing statutes, classification is to be determined by commercial understanding rather than scientific or technical meaning. As the goods did not fit Tariff Item 12 or Tariff Item 13 and no other specific item covered them, the residuary entry had to apply.

Conclusion: The goods were not classifiable under Tariff Item 13 or Tariff Item 12 and were classifiable under Tariff Item 68 of the Central Excise Tariff, in favour of the assessee.

Final Conclusion: The classification made by the lower authority was set aside and the goods were brought within the residuary excise entry.

Ratio Decidendi: In tariff classification, the commercial parlance test governs, and goods not answering the statutory description of a specific entry but having a distinct trade identity are classifiable under the residuary item.

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