TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 1364
X X X X Extracts X X X X
X X X X Extracts X X X X
....d, the appellant requested for provisional assessment which was accepted by the Revenue. On finalization of the provisional assessments based on the test reports, the benefit of the Notification was denied and differential duty was demanded by the original authority. On appeal, the Commissioner (Appeals) upheld the demands rejecting the appeal filed by the appellant, hence these appeals. 3. The Learned Counsel submitted that the appellant had entered into a contract with the foreign supplier M/s. Avanti Industries Pvt. Ltd., Singapore for import of crude palm oil of edible grade in bulk and the supplier had supplied 9749.856 metric tons of crude palm oil of edible grade in bulk against different bills of lading all dated 06.02.2012. Appellant filed 7 bills of entry all dated 22.02.2012 seeking clearance of the subject goods for home consumption classifying the same under CTH 1511 1000 and declared the subject goods as crude palm oil of edible grade in bulk and claimed the benefit of exemption from payment of duty in terms of the Notification No.21/2002 dated 01.03.2002. 3.1. Referring to the above Notification, it is submitted that crude palm oil having acid value of 4 or mor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ents; however, the Revenue took up the assessments by only providing a personal hearing to the appellant. 3.3. It is further submitted that in a similar set of facts in Appeal No. C/20073/2014, the Revenue had taken a contrary stand disregarding the report rendered by CRL, Mangalore which was in favour of the appellant and relied upon the report of CFL, Mysore which was against the appellant to confirm the demand of duty. In view of the above, it is submitted that the none of the above orders can be sustained. 3.4. Further, he submitted that Notification No. 21/2002 - Cus dated 01.03.2002 as amended cannot be denied on the premise that the Acid value exceeds 10 as alleged by the Revenue, as there is no such stipulation prescribed in the said Notification. Relying on the decision of the Hon'ble High Court of Calcutta in the case of M/s. Gokul Refoils Solvents Pvt. Ltd versus Union of India: 2012 (278) ELT 433 (Calcutta), he submits that the benefit of the Notification cannot be denied. Also relies on the decision of the Hon'ble High Court of Gujarat in the case of Cargill India Private Ltd. versus Union of India: 2013 (288) ELT 209 (Gujarat), which was appealed by the Revenue ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ue". 4.3. Similar arguments have been put forth by the Revenue with regard to Appeal No. C/20073/2014 and it is submitted that based on the Board Circular and the test reports, the appellant is not eligible for the benefit of the Notification; hence, the same is denied correctly. 5. Heard both sides. In both these appeals, the issue is common that is the appellant has imported crude palm oil edible grade in bulk and claiming the benefit of Notification No. 21/2002 dated 01.03.2002 as amended for the benefit of 'Nil' rate of duty. In both the cases, the assessments were provisional pending the test reports and based on the test reports, these assessments were finalized denying the benefit of the Notification. The dispute is whether the Revenue was correct in denying the benefit of Notification based on the test reports. 5.1. In Appeal No. C/20073/2014, we find that the appellant had filed 3 Bills of Entry, all dated 03.06.2011 importing 11999.180 metric tons of 'Crude Palm Oil' classifying the goods under CTH 1511 claiming the benefit of Notification No. 21/2002 - CUS (Sl.No.30(II)(A)) dated 01.03.2002. Since the appellant was unable to make self-assessment based on the ava....
X X X X Extracts X X X X
X X X X Extracts X X X X
....it of the Notification No. 21/2002 dated 01.03.2002. 5.4. In the first place, we need to examine the Notification which is reproduced below:- Notification No. 21/2002-Cus., dated 1-3-2002 Effective rates of basic and additional duty for specified goods falling under chapters 1 to 99 In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 17/2001-Customs, dated the 1st March, 2001 [G.S.R. 116(E), dated the 1st March, 2001], the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the goods of the description specified in column (3) of the Table below or column (3) of the said Table read with the relevant List appended hereto, as the case may be, and falling within the Chapter, heading or sub-heading of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as are specified in the corresponding entry in column (2) of the said Table, when imported into India,- (a) from so much of the duty of customs leviable thereon....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ant for splitting up of such oils into fatty acids and glycerols ----- II. The following goods, of edible grade namely, - (A) Crude palm oil falling under heading 1511, having an acid value of 4 or more and total carotenoid (as beta carotene) in the range of 250 mg/kg. 10% 45% - - 5 5 (Emphasis supplied) Condition 5: If the importer follows the procedure set out in the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996. 5.5. As seen from the relevant Notification under Sl. No. 30(II)(A), the benefit of 45% is available to Crude Palm Oil having an Acid value of 4 or more. The dispute being only of Acid value, since the Notification does not specify the upper limit, the denial of the benefit of the Notification stating that the Acid value was 10.7 cannot be justified. Therefore, as rightly claimed by the appellant the higher limit cannot be read into the Notification. The reliance placed by the Revenue on the Circular No. 40/2001 dated 13.07.2001 is also misplaced since the circular deals with clearance of vegetable oils imported for industrial purposes at concessional rate of dut....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ading 1511 contains no item of edible grade unlike Headings 1507, 1508, 1509, 1510, 1512, 1514, 1515, 1516, 1517 and 1518 of Chapter 15. Thus, the supplementary notes attached to Chapter 15 defining the edible grade applies only to those headings under the said Chapter where the phrase "edible grades" find place. The exemption notification, on the other hand, in spite of the fact that the Heading 1511 contains no item of edible grade, specifically recognizes three items of Heading 1511 as "edible grade" for the purpose of giving exemption only. 12. In the notification in question, crude palm oil falling under Heading 1511 having an acid value of 4 or more is fully exempted provided the total carotenoid (as beta carotene) is in the range of 250 mg/kg. to 2500 mg/kg. The aforesaid item has been described as edible grade only for the purpose of exemption by specifically declaring that "the following goods of edible grade, namely, (A), (B) and (C)" would be fully exempted by giving specific description of those three categories. 13. We are unable to accept the contention advanced on behalf of the learned advocate for the Revenue that we should read the notification as....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... not to challenge the said order. Such being the position, there is no justification on the part of the Revenue to take a different view in the consignment involved in these writ-applications. 18. As pointed out by the Supreme Court in the case of Commissioner of Customs (Preventive), Gujarat v Reliance Petroleum Limited reported in 2008 (227) E.L.T. 3 (S.C.), interpretation of an exemption notification depends upon the nature and extent thereof, and the terminologies used in notification have an important role to play. According to the said decision where exemption notification ex facie applies, there is no reason as to why purport thereof would be limited by giving a different construction. Applying the aforesaid principles to the facts of the present case, we are of the view that under the notification, as the limit of acid value has been given as 4 and above, there is no reason to construe the notification by taking aid of the Prevention of Food Adulteration Rules, 1955 which has no application to the facts of the present case when the petitioners intended to import the same not as a 'food' but as crude palm oil (edible grade) as pointed out in the exemption n....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Export case (supra) stands overruled." In view of the above, in the instant case there is no ambiguity in the Notification wherein it clearly mentions that Acid Value "4 or more", there being no upper limit, the same cannot be inserted into the Notification. Moreover, we also find that the Original Authority while finalizing the provisional assessments vide order dated 25.04.2013 has observed as follows at Para 6:- 6. "Accordingly, as per the request of the importers, the Commissioner has permitted them for reprocessing of the imported cargo in their factory premises subject to the conditions that due care and precaution be taken from both sides i.e., Customs and Central Excise to ensure that the same goods imported undergo reprocessing. Subsequently, the reprocessed cargo has been cleared after following the Central Excise rules and the cargo has been given out of charge after getting PHO clearance on the reprocessed cargo". 5.9. Since the imported goods have been reprocessed to make them edible and cleared after getting PHO clearance, denial of the benefit of the Notification that they do not meet the standards is nullified. Thus, considering the fact that the sai....