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2015 (12) TMI 247 - SUPREME COURT

2015 (12) TMI 247 - SUPREME COURT - 2015 (325) E.L.T. 815 (SC) - Classification of Vitamin E-50 powder (Feed Grade) - whether Vitamin E-50 is classifiable under Chapter 2309.00 as “Prawn Feed” and therefore eligible for the benefit of partial exemption from duty under Notification No. 20/99 dated 28.02.1999. - Held that:- Shri Yashank Adhyaru, learned senior counsel appearing on behalf of the Revenue, relied upon a later two Judges Bench judgment of this Court in 'Collector of Central Excise, Gu .....

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Further, in a judgment of three Judges' Bench in Collector of Central Excise, Bangalore v. Tetragon Chemie (P) Ltd. [2001 (7) TMI 127 - SUPREME COURT OF INDIA]. In this judgment, the question that arose for consideration again relates to vitamins that were mixed with animal feed as animal feed supplements.

Faced with an entry which spoke of preparation of a kind used in animal feeding including dog and cat food, this Court came to the conclusion that animal feed supplement .....

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tter should be placed before Hon'ble the Chief Justice of India to constitute an appropriate Bench to resolve the doubts pointed out by us in the body of this Order. - Civil Appeal No. 3327/2007 - Dated:- 8-10-2015 - Mr. A.K. Sikri And Mr. Rohinton Fali Nariman, JJ For the Petitioner : Mr. Yashank Adhyaru, Sr. Adv., Mr. Sanjai Kumar Pathak, Adv., Ms. Binu Tamta, Adv., Mr. Rajiv Singh, Adv., Mr. Aviral Kashyap, Adv. & Mr. B. Krishna Prasad, Adv. For the Respondent : Mr. Alok Yadav, Adv., Mr. .....

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essional rate of duty at 5 per cent under the aforesaid Notification No. 20/99 at Serial No. 20 which reads as follows: - S. No. Chapter or Heading No. Or sub-heading No. Description of goods Standard Rate Additional duty rate Condition No. 20. 2309.90 Prawn feed 5% - The Order-in-Original reasoned: Thus from the above, it is unambiguously clear that item under import cannot be considered as 'Prawn Feed' to claim the benefit under notification no. 20/99. In this regard the importers, hav .....

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23 and thus eligible for exemption under Notification 234/82. The Hon'ble Supreme Court in very clear terms has laid down that animal feed supplement or animal feed concentrate are covered by the generic term 'Animal Feed' and thus are eligible for exemption under notification 234/82-CE. In view of above decisions of Hon'ble Supreme Court, I find that chemical ingredients such as Vitamin E which are imported on same carrier such as Silica Maize etc., and are used for manufacture .....

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Feed' is a generic term and may include 'Prawn Feed', Poultry Feed, Cattle Feed and feed supplements as held by the Hon'ble Supreme Court's in the above noted case. Whereas the benefit of notification No. 20/99 is available to 'Prawn Feed' which is a restrictive terms unlike the terms 'Animal Feed'. Various High Courts and the Hon'ble Supreme Court in their various judgments has laid down that there should be strict interpretation of the notification. Hon .....

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very clear that items imported under above said B/E viz., Vitamin E 50 Feed grade is ingredients for manufacture of 'Prawn Feed'/ Animal Feed, and by no stretch of imagination can be considered as 'Prawn Feed' as such and thus not eligible for benefit of concessional rate of duty under notification No. 20/99. In view of above finding I order that benefit of notification No. 20/99 is not available to items imported under B/E No. 8207 dated 19.08.1999 and the same should be assesse .....

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SCC 564] allowed the appeal in favour of the assessee. The Department carried a further appeal to Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as 'CESTAT') which by the impugned judgment dated 05.12.2005 dismissed the Department's appeal also relying upon the self same judgment. Shri Yashank Adhyaru, learned senior counsel appearing on behalf of the Revenue, relied upon a later two Judges Bench judgment of this Court in 'Collector of Central Excise, .....

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al feed includes animal feed supplements and as such M/s. Sun Exports Corporation was declared to be entitled to refund under the relevant exemption notification. The brief facts as appears from the decision (at page 565) leading to these appeals are as follows: The appellant Corporation imported six consignments of goods [Pre-mix of Vitamin AD-3 Mix (feed grade)] at Bombay and seven consignments of similar goods at Calcutta. These consignments were assessed to duty under the heading 29.01/45(17 .....

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orts. The Assistant Collector (Refunds) concerned rejected the claim of the appellant holding that the goods imported were assessable to duty under the heading 29.01/45(17) of the then prevailing First Schedule to the Customs Tariff Act read with Item 68 of the Central Excise Tariff and therefore, the Exemption Notification dated 1-11-1982 was of no avail to the Corporation. 3. Aggrieved by the rejection of refund applications the appellant preferred separate appeals one set before Collector of .....

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is Court in paragraph 14 of the report observed as below: 14. We have carefully gone through the minority and the majority views of the Tribunal. We find that Shri K. Gopal Hegde who has dealt with the issue in extenso, has taken note of the ratio laid down by the Bombay and Gujarat High Courts as well as a subsequent decision of the Tribunal itself in CCE v. Punjab Bone Mills [1988 (38) E.L.T. 389 (Tribunal) (Appeal No. 615/85-C with E/Cros/64/1988-C)] for coming to a conclusion that the goods .....

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that presumably the amendment to Exemption Notification No. 234/82 by a subsequent Notification No. 6/84-C.E., dated 15-2-1984 was not before the Court for consideration. The majority view also failed to take note of the subsequent amendment to the main exemption notification as well as the effect of the amendment as noticed by the Bombay High Court in Glindia Ltd. Case [1988 (36) E.L.T. 479 (Bom.)]. Since we have already extracted in extenso the decision of the Bombay High Court, we do not thi .....

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this Court in Surendra Cotton Oil Mills's case was, according to the learned counsel, in his favour, it is clear, therefore, that a prawn feed supplement with the imported product Vitamin E-50, as such would not fall within the expression Prawn Feed . He further argued that it is clear from a catena of decisions that an exemption Notification is to be strictly construed and if prawn feed supplements are not, in fact, included, they cannot be included by inference. He also argued that Sun Ex .....

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hat his case was covered on all counts by Sun Export Corporation's judgment in as much as animal feed was held to include animal feed supplement as well and that therefore, in the present case, prawn feed supplement would be included within the expression Prawn Feed . He further added that Surendra Cotton Oil Mills's case, the later judgment of this Court, was on a completely different set of facts and merely distinguished the Sun Export Corporation's judgment. As his case falls dire .....

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-1982 read as follows: Exemption to certain specified goods. - In exercise of the powers conferred by sub-rule (I) of Rule 8 of the Central Excise Rules, 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 104/82-Central Excise, dated the 28th February, 1982, the Central Government hereby exempts goods of the description specified in the Schedule hereto annexed and falling under Item No. 68 of the First Schedule to the C .....

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ssee must succeed held: - 12. Now, the question is whether the animal feed supplement would fall under the exemption notification dated 1-11-1982. As noticed earlier similar question was considered by the Bombay High Court and the learned Judge expressed the view as follows: ..The preparations in question are used to supplement animal feed. Sometimes animal feed or poultry feed is already fortified with these vitamins when sold. Sometimes, however, farmers prefer to add the vitamins either to an .....

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eed. * * * It is next contended by the respondent that even if the two products fall under Tariff Item 68 the benefit of the Exemption Notification No. 55 of 1975 cannot be given to these products because these products are not animal feeds. They are merely animal feed supplements. This exemption notification has been amended by another notification No. 6 of 1984 dated 15th February, 1984 as a result of which the item 'animal feed including compound livestock feed' is now substituted by .....

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required to consider whether certain vitamin products including Vitablend WM Forte which were used for supplementing cattle and poultry feed should be classified as 'cattle feed' within the meaning of Entry 21 of Schedule I of the Gujarat Sales Tax Act, 1969 or 'poultry feed' within the meaning of Entry 22 of Schedule I of that Act. The Gujarat High Court has held that the terms 'cattle feed' and 'poultry feed' must include not only that food which is supplied to .....

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ds'. It was submitted by the respondents that the subsequent amendment expressly refers to 'animal feed supplements'. This suggests that animal feed supplements were not previously included in the exemption notification. This reasoning must be rejected. The amendment appears to be clarificatory in nature. For example, the amendment now expressly refers also to animal feed concentrates which were not expressly referred to earlier. It cannot be said that animal feed concentrates are no .....

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relied upon as a binding precedent. Even assuming that there are two views possible, it is well settled that one favourable to the assessee in matters of taxation has to be preferred. We have serious doubts as to whether the Bombay High Court judgment affirmed in Sun Export Corporation's case is correct. First and foremost, it is clear that the subsequent exemption Notification largely expanded the first Notification which referred only to animal feeds and nothing else. That being the case, .....

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tion's case in paragraph 13 thereof. Apart from this, the view of this Court in paragraph 13 that it is well-settled that if two views are possible, one favourable to the assessee in matters of taxation has to be preferred is unexceptionable. However, this Court was not concerned in that case with the charging Section of a taxation statute. It was concerned with the interpretation of an Exemption Notification which, as has been stated above, would require the exactly opposite test to be fulf .....

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