TMI BlogClearance of vegetable oils imported for industrial purposes at concessional rate of duty under notification No.17/2001-Cus., dated 1.3.2001 - RegX X X X Extracts X X X X X X X X Extracts X X X X ..... aimed to have been imported for industrial purposes have been brought to Board's notice. Whereas, in some Custom Houses some manufacturer importers have been allowed the concessional rate of duty of 35% treating the crude palm oil imported as other than edible oil, doubts have been raised about admissibility of this concessional rate at certain other Custom Houses taking into account the Board's instructions under Circular No.29/97-Cus., dated 31.7.1997. It has been argued that as per the said circular even though the crude palm oil imported as such, considering the composition, free fatty acid/acid content may not qualify to be termed as edible oil under the PFA Act, 1954, but since the oil imported can be made fit for human consumption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Adulteration Act, 1954 and rules made thereunder for human consumption. The PFA Act, 1954 has laid down the standards of crude palm oil and prescribed the maximum limit of the acid value for crude palm oil as 10.0. 3. Considering this definition one of the food and drugs laboratory after taking samples from a consignment of the imported crude palm oil - which showed acid values varying from 13% to 18%, has opined that the samples do not conform to the standards of edible grade palm oil prescribed under PFA rules and is not edible as such. In another case, a chemical examiner relying upon the Board's 1997 circular, even though the sample had acid values of more than 13% took the view that it may be considered as edible oil as aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the existing tax structure under 11/2001, Government has consciously provided for a concessional rate of 35% duty for oils used other than for edible purposes. Thus if it can be established by the importing industry/trade that the oil imported as such is not fit for human consumption, (and needs to be refined before it can possible be made fit for human consumption) and actually it is not being subjected to refining for edible use but on the other hand it is used for industrial purposes, it will not be proper to deny, the benefit of lower concessional rate of 35%. The onus of proving the actual final use could be put on the importer of such crude palm oil wherever he claims that the consignment of crude palm oil which does not satisf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on etc.; (b) In case on test, it is found that vegetable oil does not conform to the standards of PFA Act, 1954 and acid value free fatty acid are higher than the permissible limits (i.e. acid value exceeds 10%) the consignments may be assessed provisionally at the rate claimed, i.e., 35% and allowed to be moved on execution of a bond for establishing the end use of the oil for actual manufacture of soap or other industrial use as claimed. The bond should cover the differential duty liability between the industrial and edible grade oil. In case, import is by an actual user manufacturer, a security/bank guarantee amounting to 25% of the bond value may be taken. However, where the import is not for actual use but for trading and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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