Notification No. 99/84-C.E., dated 30-4-1984 and No. 155/86-C.E., dated 1-3-1986 - Definition of 'edible rice bran oil' - Regarding - Central Excise - 332/55/86-TRU

Notification No. 99/84-C.E., dated 30-4-1984 and No. 155/86-C.E., dated 1-3-1986 - Definition of 'edible rice bran oil' - Regarding F. No. 332/55/86-TRU Dated 9-4-1987 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Notification No. 99/84-C.E., dated 30-4-1984 and No. 155/86-C.E., dated 1-3-1986 - Definition of 'edible rice bran oil' - Regarding. Attention is invited to Notifications 99/84-Central Excises, dated 30-4-1984 and Notification No. 115/86-Central Excises, dated 1-3-1986 granting exemption from excise duty on vegetable product manufactured using rice bran oil of edible grade. An explanation was included in the notifications as follows : "rice bran oil of edible grade means the rice bran oil which conforms to the standards of quality of edible oils specified for rice bran oil in the Prevention of Food Adulteration Rules, 1955, under the Prevention of Food Adulteration Act, 1954 (37 of 1954), as amended from time to time". 2. Reports have been received in the Board that samples of rice bran oil drawn by the Collectorates from Vanaspati manufacturing units were found to be not conforming to the standard of edible grade oils as per the P.F.A. Rules and demands have been issued for recovery of the rebate availed of in such cases. Representations have also been received in the Ministry from the manufacturers of vanaspati that the samples are being tested for the standard of refined grade rice bran oil under Rule 5 of P.F.A. Rules. They have urged that such tests should be against standards of raw oil permitted for use in manufacture of vanaspati under Rule 67(3) of the P.F.A. Rules. 3. The matter was examined in the Board in consultation with the Directorate of Vanaspati, Vegetable Oils and Fats (in Ministry of Civil Supplies) and Central Revenues Control Laboratory. 4. Officers of the Central Revenues Control Laboratory have confirmed that the samples were tested against the standard for refined rice-bran-oil laid down under Rule 5 of the Prevention of Food Adulteration Rules, 1955. 5. Officers of the Directorate of Vanaspati, Vegetable Oils and Fats have explained that standard under Rule 5 (extracts of the relevant standard A. 17.23 is enclosed) for "articles of food" and it will not be reasonable to stipulate that the raw materials for vanaspati or the in-process samples down for standard A. 17.23 is applicable to oil sold for direct human consumption is incorporated in the standard itself. Moreover, the standard for the marketed product namely, vanaspati is also laid down in the PFA Rules separately and as such there is no reason why in-process samples should meet the requirement under standard A.17.23. 6. Rice bran oil is extracted by solvent extraction method. The raw oil can be categorised into two different qualities, namely, that fit for refining for direct human consumption or use in the manufacture of vanaspati and the second grade which may be used only for industrial purposes like manufacture of soap. The standard for quality of oils permitted for use in the manufacture of vanaspati is stipulated in Rule 67(3) of the PFA Rules according to which the required standard is the standard for "Raw Grade I" for solvent extracted oils laid down in Rule 9(2) of the Solvent Extracted Oil Deoiled Meal and Edible Flour Control Order, 1967. Extract of the relevant rules and the standard are enclosed. Since the notification lays down the standard for raw material used in the manufacture of vanaspati, the term "edible oil" used in the explanation to the notification has to be understood as the oil which can be processed for edible purposes as distinct from that which is permitted for use in industrial purposes only. 7. On examination of the matter, the Board is of the view that the explanation regarding edible grade rice bran oil given in notification No. 99/84-C.E., dated 30-4-1984 and No. 115/86-C.E., dated the 1-3-1986 is to be interpreted to mean that the raw rice bran oil used in the manufacture of vanaspati should conform to the standards as required under rule 67(3) of the PFA Rules. 8. However, in view of the explanation 3 in notification 115/86 the extent of rebate shall be only with reference to the quantity of oil immediately before the process of hydrogenation.