2011 (4) TMI 270

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....f the oil so obtained. Apart from this, they were obtaining crude oil extracted by solvent extraction method from others and getting it refined  and clearing the same. They were claiming exemption under Notification No.115/75 dated 30.4.1975 which provided exemption for goods manufactured in a factory covered by solvent extraction industry.   2. The case made out by the Department is that the appellant is only doing the process of refining and no process of milling/solvent extraction was performed on the impugned goods by the appellant for obtaining the by-products i.e. soya lecithin and oil sludge. Hence it is argued that derived products like soya lecithin and oil sludge cannot be said to be product of Oil Mill/Solvent Extrac....

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....t crude oil was purchased from outside and there being no production of oil by extraction process from the oil seeds etc., the manufacturers were not entitled to the benefit of the said notification which exempts refined edible oil manufactured by the oil mill and solvent extraction industry. The plea of the Revenue was rejected in the case of A.P. Solvex Ltd. v. CCE, Ludhiana (supra) observing that no such condition had been imposed in the Notification that the entire extraction of raw rice bran oil (which was the subject input in that case), should be carried out in the factory by the manufacturer for claiming exemption from payment of duty on refined edible oil. The Tribunal in conclusion relied upon a decision of the Bangalore Bench in ....

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....ear on interpretation of the above notification in the case of A.P. Solvex Ltd. v CCE., Ludhiana (supra), which not challenged by the Revenue, that fatty acid or residues, as the case may be, being by-products of the manufacturing process in the appellant s factory, cannot be subjected to levy of excise duty as they are covered by the exemption notification. Faced with the decision in A.P. Solvex Ltd. v. CCE. Ludhiana (supra), the learned DR submitted that the benefit envisaged in the exemption notification is available only in cases where the unit is engaged in the manufacture of oil by process of extraction. In the instant case, it was pointed out that 97% of the manufacturing activities carried out in the case of M/s. Prakash Solvex and ....