TaxTMI 
TaxTMI 
2002 (6) TMI 364
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.... Spice Oils, Oleoresins, Sandal Wood Oil etc,. falling under Chapter Heading No. 3301 of Central Excise Tariff Act, 1985. The goods manufactured by the assessee are being cleared for export and domestic purpose without demand of duty as being exempted products under Notification No. 115/75, dated 30-4-75. Notification No. 115/75-C.E., dated 30-4-75 inter alia exempts goods manufactured in the solvent extraction industry. The assessee was clearing their products for home consumption on payment of Central Excise duty at the appropriate rate till 31-7-99 despite the above exemption Notification. But they discontinued payment of duty from 1-8-99, claimed exemption under Notification 115/75, dated 30-4-75 as amended based on the judgment of the ....
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.... for the period 1-8-99 to 8-7-2000. Accordingly show cause notice was issued raising the demand of Rs. 38,35,280/- and proposed to take penal action. Show-cause notice was duly answered by the party. The Commissioner who adjudicated the matter held that in the manufacture of sandal wood oil, raw-sandal wood is ground to the required size, the powder is led into kettles and subjected to steam distillation to recover the oil. It is, therefore, quite obvious that sandal wood oil cannot be manufactured in oil mill nor can this oil be manufactured in a solvent extraction plant by employing solvent extraction process. He held that sandal wood oil is neither a product of oil mill nor that of solvent extraction industry. He concluded that when a pr....
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.... said that up to the stage of steam distillation, the manufacturing process is one and the same for both essential oils and oleoresin. Insofar as essential oils including Sandal Wood Oil are concerned the process stops with the steam distillation. The deoiled material is left over in the kettle after steam distillation and thereafter used to manufacture oleoresin. He said, therefore sandal wood oil is manufactured in the first stage of the process for the manufacture of oleoresin in the solvent extraction plant. Relevant Notification 115/75-C.E., dt. 30-4-75 as amended is as follows : "Exemption to products of various specified industries. - In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, t....
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.... Court, the Tribunal held Soap Stock obtained as by-product by treating oil which has been produced by milling or solvent extraction method is eligible for benefit of Notification No. 115/75 [1999 (107) E.L.T. 449]. Similarly, it was held in the case of Coir Cushions (P) Ltd. v. Collector of Central Excise, Meerut [1999 (108) E.L.T. 432] that latex mix manufactured by Coir Industry is entitled to exemption under Notification 115/75 by virtue of the language of the notification. These views were upheld by the Supreme Court while dismissing the appeal filed by the Department as reported under Court Room Highlights in 2000 (115) E.L.T. (A75) and 2001 (134) E.L.T. (A242) respectively. 6. Sri Thomas Vellapally further contended that apart ....
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.... any such restrictions with reference to the process of manufacture while extending the benefit of exemption Notification except goods other than items falling under headings 15.03 and 15.04 provided the goods are manufactured in the factory covered by industries specified in the schedule. Admittedly the appellant is a solvent extraction industry and sandalwood oil was manufactured by them. The Department earlier was of the view that the exemption would only be available in the case of Oil Mill Industry also doing the solvent extraction process. This was however finally resolved by the Supreme Court in the case of Bombay Oil Industries holding that the products of solvent extract industry are independently exempts. It was clearly held there....