Commercial meaning test excluded unflavoured cocoa powder from excise classification as cocoa powder.

Unflavoured and unblended cocoa powder obtained by pulverising cocoa cake was not classifiable as "cocoa powder" under Item I-A because excisable goods in a taxing statute must be understood in their common parlance or trade meaning unless the statute provides otherwise. The authorities had relied on marketability and dictionary meaning without proving that the unflavoured product was recognised in trade as cocoa powder. Material from traders, users and a food technology expert showed that, in commerce, cocoa powder meant flavoured and blended cocoa powder. The excise demands and consequential orders were therefore unsustainable.

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Issues: Whether unflavoured and unblended cocoa powder obtained by pulverising cocoa cake fell within Item I-A of the Schedule to the Central Excises and Salt Act, 1944 as "cocoa powder", and whether the expression had to be construed according to trade and commercial understanding or by reference to marketability and plain dictionary meaning.

Analysis: The levy on an excisable article in a taxing statute must be tested by the sense in which the article is ordinarily understood in commerce and by persons dealing in such goods, unless the statute defines it otherwise. The common parlance or commercial meaning test was therefore the proper standard for construing "cocoa powder" in Item I-A. The authorities had proceeded mainly on marketability and on a plain meaning approach, without establishing that unblended and unflavoured cocoa powder was known in trade as cocoa powder. The materials before the revisional authority, including affidavits from traders, users and a food technology expert, showed that in trade cocoa powder meant flavoured and blended cocoa powder and that the unflavoured and unblended product was not recognised as such and was not an edible consumer product in the relevant sense.

Conclusion: Unflavoured and unblended cocoa powder did not fall within Item I-A as "cocoa powder" and the excise demands and consequential orders were unsustainable.

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