1992 (2) TMI 211

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....DO cleared as sludge without payment of duty from two of their tanks on execution of an undertaking. The samples drawn from the two tanks were sent for test to the Chemical Examiner, Kandla and the following were the results :- (a) Tank No. 109 "(1) The sample is in the form of dark coloured viscous liquid. It is mainly composed of Mineral Oil, water and other impurities, water content is 20% (2) The mineral oil content in the sample is 80% and in case of (b) Tank No. 306 (1) The sample is in the form of dark brown thick viscous liquid. It is mainly composed of the Mineral Oil, water arid other impurities. (2) Percentage of Mineral Oil is 83.05." 2. Based on these reports showing very high percentage of Mineral Oil cont....

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....e appellants have also taken the plea that no sample of sludge could ever be regarded as reliable because in the very nature of things the impurities and sediments in oil which are formed over a period of time are spread over in different proportions and sludge is not a homogeneous product which can reveal through a few samples the real representative nature of the oil content in the sludge as a whole. Moreover, in the absence of any specific findings by the Chemical Examiner that the sample could be regarded as meeting the specification for LDO there was no justification to draw the inference that the sludge was being sold as LDO and as such duty was payable thereon. 5. The impugned orders have also been assailed on the ground that as l....

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.... the same was removed and destroyed. 8. We have carefully considered the rival submissions. It is noticed from the test reports of the two samples that they were in the form of dark coloured viscous liquid mainly composed of mineral oil, water and other impurities and the water content varied between 16% to 20%. The Chemical Examiner has not stated that such a heterogeneous material conforms to the specification of any of the petroleum products covered by Items 6 to 11 of the erstwhile Central Excise Tariff. It is necessary for commodities like petroleum products to meet the specifications prescribed for them in the tariff and, in the absence of such requirements being fulfilled, it would not be correct to treat them as one petroleum pro....