TaxTMI 
TaxTMI 
2010 (10) TMI 7
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....E and 5/99-CE. 2. Shorn of unnecessary details, the facts material for the adjudication of these appeals, may be stated thus: The appellant viz. M/s Indian Oil Corporation Ltd, a public sector undertaking, hereinafter referred to as the assessee, is manufacturer of petroleum products, including "superior kerosene" classified under Chapter sub-heading 2710.90 of the Central Excise Tariff Act, 1985 (for short "the Tariff Act"). 3. By virtue of Notification No. 5/98-CE dated 2nd June 1998 certain excisable goods were brought under General Exemption No. 66, and a certain category of kerosene products were made subject to concessional rate of duty. It would be expedient to extract the relevant portions of the said n....
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....nt in oil burning lamps" 8% -- 5. The assessee claimed the benefit of concessional rate of duty under Notification No. 5/98-CE for their kerosene products in their declaration effective from 2nd June 1998. Subsequently, in their declarations effective from 28th February 1999 and 4th August 1999 respectively, they claimed benefit of concessional rate of duty under Notification No. 5/99. It is pertinent to note that during the period 1998-99 and 1999-2000, the tariff rate corresponding to Chapter sub-heading 2710.90 was 15% and 16% respectively. 6. The Excise department issued three show cause notices to the assessee, dated 31st March 1999, 12th July 1999 and 19th November 1999, for the periods September, 199....
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....... .... .... .... .... .... .... .... .... .. In other words, the stock was ordinarily used as illuminant in oil burning lamps and the benefit of the notifications was rightly extended to the kerosene cleared through the PDS to domestic consumers... .... .... .... .... .... ..... .... .... .... .... .... .... .... .... .... .... .... .. 9. The subject matter of this case is the stock of kerosene which the appellants cleared to industrial users during the period of dispute, on payment of duty at the concessional rates under the notifications. The appellants have estimated such clearances at about 1% of their total production of kerosene of the said period. The appellants have no case that any part of the said stock was u....
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.... was cleared to industrial users, as long as the said kerosene was capable of illumination in oil burning lamps. Commending us to the decision of this Court in Commissioner of Customs, Mumbai Vs. J.D. Orgochem Ltd. (2008) 16 SCC 576and the decision of the Gujarat High Court in Viswa & Co. Vs. The State of Gujarat [1966] 17 S.T.C. 581, learned counsel contended that the word "ordinarily" used in the notifications means "in the majority of cases, but not invariably", and therefore, the fact that 1% of the kerosene manufactured by the assessee was cleared to industrial users does not change the fact that most of the kerosene manufactured by the assessee was cleared to the Public Distribution System (for short "PDS"). 12. Per contra, ....
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....ash Chandra v. Union of India (1962) 1 S.C.R. 374 and Krishan Gopal v. Prakashchandra (1974) 1 SCC 128 but, the said expression must be understood in the context in which it has been used." 16. Therefore, in light of the object and context of the notifications, it becomes abundantly clear that the word "ordinarily" implies that the kerosene must be ordinarily used for illumination purposes, and it would be immaterial if the kerosene is also used for other domestic purposes. 17. From a bare perusal of the two notifications it is plain that the benefit of concessional rate of duty extends only to that variety of kerosene that: (i) has a smoke point of 18mm or more, and (ii) is ordinarily used as an illuminant in oil burnin....