Custom, Excise & Service Tax Tribunal
Vijayawada vs Asia Pacific Commodities Ltd on 12 June, 2020
(1) Appeal No. C/1766,1767,
1777&1783/2012
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
REGIONAL BENCH AT HYDERABAD
Division Bench - Court No. - I
Customs Appeal No. 1766, 1767 & 1783 of 2012
(Arising out of Order-in-Appeal No.02/2012-V II CUS, dated 22.03.2012 passed by
Commissioner of Customs, Central Excise & Service Tax, Visakhapatnam)
Asia Pacific Commodities Ltd., .. APPELLANT
Tanuku Road, Tadepalligudem,
West Godavari District,
Andhra Pradesh - 534 101.
VERSUS
Commissioner of Customs, .. RESPONDENT
Vijayawada
D. No. 55-17-3, 2nd Floor, C-14,
Road No. 2, Industrial Estate,
Vijayawada,
Andhra Pradesh - 520 007.
AND
Customs Appeal No. 1777 of 2012
(Arising out of Order-in-Appeal No.02/2012-V II CUS, dated 22.03.2012 passed by
Commissioner of Customs, Central Excise & Service Tax, Visakhapatnam)
Commissioner of Customs, .. APPELLANT
Vijayawada
D. No. 55-17-3, 2nd Floor, C-14,
Road No. 2, Industrial Estate,
Vijayawada,
Andhra Pradesh - 520 007.
VERSUS
Asia Pacific Commodities Ltd., .. RESPONDENT
Tanuku Road, Tadepalligudem,
West Godavari District,
Andhra Pradesh - 534 101.
Appearance
Shri Y. Sreenivasa Reddy, Advocate for the Assessee.
Shri C. Mallikarjun Reddy, Superintendent for the Revenue.
Coram: Hon'ble Mr. ANIL CHOUDARY, MEMBER (JUDICIAL)
Hon'ble Mr. P.V. SUBBA RAO, MEMBER (TECHNICAL)
FINAL ORDER No. A/30890-30893/2020
Date of Hearing:02.03.2020
Date of Decision:12.06.2020
[ORDER PER: P.V. SUBBA RAO]
1. These appeals have been filed by the appellant assessee and the
Revenue against the same impugned order and hence are being disposed of
together. Appeals No. 1766, 1767 & 1783 of 2012 have been filed by the
assessee and 1777/2012 has filed by the Revenue. The assessee is an
importer of palm oil and they filed bills of entry in the months of January and
February, 2005. Samples of the oil were drawn by the Port Health Officer on
(2) Appeal No. C/1766,1767,
1777&1783/2012
27.01.2005 and he sent his reports dated 28.01.2005. Samples were also
drawn by the customs officer in the presence of the importer on the same
date and sent to the customs laboratory for testing. The customs laboratory
gave its report on 11.02.2005. There is a difference between the test report
by the Port Health Officer and the test report of the customs laboratory
which lies at the root of these appeals. Crude palm oil falls under customs
tariff heading 1511 and attracts duty at a rate of 100% of the tariff value.
However, Notification No. 21/2002-Cus as amended, gives concessional rate
of duty on palm oil of edible grade subject to certain conditions. The
assessee imported palm oil and filed five Bills of entry declaring it to be of
edible grade. In respect of two bills of entry on 28.01.2005 and 29.01.2005
they claimed concessional rate of 75% of the tariff value under exemption
Notification No. 21/2002-Cus. The relevant entry in the exemption
notification is as follows:
Sl.No. Chapter Description of the goods Standard Additional Condition
Heading rate duty rate No.
34. 15.11 Crude palm oil and its 75% - -
fractions, of edible grade,
in loose or bulk form
Thus with respect to these two bills of entry there was no condition in the
exemption notification except that the palm oil which was imported must be
of edible grade.
2. In respect of the remaining three bills of entry, the appellant declared
the goods as edible grade crude palm oil. The exemption notification
applicable during the relevant period as follows:
The following goods, namely:-
(1) (2) (3) (4) (5) (6)
34. 1511 The following goods, namely:- 65% - 5
(A) Crude palm oil of edible grade, having
an acid value of 4 or more and total
carotenoid (as beta carotene) in the range of
250 mg/kg., in loose or bulk form for
manufacture of refined oil, refined palmolein,
vanaspati, bakery shortening or interesterified
fats;
The aforesaid condition no. 5 is as follows:
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.
(3) Appeal No. C/1766,1767,
1777&1783/2012
Thus, the requirements with respect to these three bills of entry are that the
acid value should be more than 4% and carotenoid value must be in 250 to
2500 per mg. Apparently, the importer has registered himself with the
customs under the Customs (Import of Goods on Concessional Rate of Duty
for Manufacture of Excisable Goods) Rules, 1996 as required. However, in
respect of both the notifications, the palm oil has to be of EDIBLE GRADE.
3. The dispute which arises in these cases is with respect to the test
reports sent by the chemical examiner of the Customs Department and the
reports given by the Port Health Officer. The Port Health Officer had drawn
samples and certified that the oil is fit for human consumption while the
chemical examiner had in his reports reported as follows:
Acid value is 10.0
Total carotenoid concentration is 395.2 mg/kg in report dated 11.02.2005
Test memo 103/2005 - acid value 10.9 carotenoid 398.2 mg/kg
Test memo ST/14/2005 acid value 10.8 total carotenoid concentration 412.1
4. All bills of entry were initially assessed provisionally and thereafter a
show cause notice was issued by the department to the assessee proposing
finalisation of assessment and denying concessional rate of duty claimed by
them on the ground that the palm oil was of not edible grade as the acid
value in all cases is more than 10. Assessments were finalised accordingly.
On appeal, the Commissioner (Appeals) by his order dated 13.02.2008
remanded the matter back to the original authority. Against this order of
the Commissioner (Appeals), the department filed an appeal before this
Tribunal who, by its order dated 21.12.2010 also remanded the matter to
the original authority with same directions.
5. The original authority by his denovo order dated 27.07.2011 confirmed
the demand in respect of all Bills of Entry on the ground that the imported
oil is not of edible grade and hence concessional rate of duty is not
applicable since the acid value of the imported palm oil is more than 10. On
appeal, the First Appellate Authority, by the impugned order, allowed the
appeal in respect of three bills of entry filed after 04.02.2005 but rejected
the appeal in respect of the first two bills of entry. The assessee's appeal is
against the rejection in respect of the two bills of entry while the Revenue's
appeal is with respect to the allowance of the benefit of exemption
notification in respect of the two bills of entry.
(4) Appeal No. C/1766,1767,
1777&1783/2012
6. Learned Counsel for the appellant assessee asserts that the
Commissioner (Appeals) has wrongly rejected their appeal in respect of the
two bills of entry which must be given to them. He would assert that the
Port Health Officer is the correct authority to determine whether or not the
oil is of edible grade and therefore the department should not have sent
samples to Customs Laboratory at all for testing. Neverthless, the
department sent the samples. The test reports were not given to them
during the first round of litigation and only in the remand proceedings the
test reports were provided to them. Evidently, according to the Customs
Laboratory the imported oil is not of edible grade because the acid value
exceeds 10. He would assert that the test report of the Port Health Officer
must prevail over the test report by the CRCL as he has the authority as far
as the testing under the Prevention of Food Adulteration act is concerned.
According to the Learned Counsel, this Bench should rely upon the test
report of the Port Health Officer and ignore the test report of the Customs
Laboratory and give them the benefit of the exemption notification. He
relies on the following case laws:
1. Commissioner Order dt.5.7.2013 in the case of Kedia Overseas Ltd., Visakhapatnam
and acceptance of the order by the department
2. Cargill India Pvt Ltd., vs UOI
[2013 (288) ELT 209 (Guj)]
3. CCE, Vijayawada vs Saraiwala Agro Refineries Ltd.,
[2017 (349) ELT 152 (Tri-Hyd)]
4. Ruchi Infrastructure Ltd., vs CCE, Visakhapatnam
[2004 (168) ELT 49 (Tri-Bang)
5. Circular No. 3/2011-Cus dated 06.01.2011
6. Gokul Refoils Solvents Pvt Ltd., Vs UOI
[2012 (278) ELT 433 (Cal)] and acceptance of the order by the department
7. Godrej Industries Ltd., Vs CC, Mumbai
[2017 (357) ELT 899 (Tri-Mum)]
8. Liberty Oil Mills Ltd., Vs CC (Import), Mumbai
[2015 (322) ELT 528 (Tri-Mum)]
9. Ruchi Soya Industries Ltd., Vs CC (Import), Jamnagar
[2006 (206) ELT 827 (Tri-Mum)
10. Vinay Corporation Vs CC (Import), Mumbai
[2008 (221) ELT 90 (Tri-Mum)
11. Satyam Enterprises Vs UOI
[2017 (348) ELT 229 (M.P.)]
12. PEC Ltd., Vs CC, Visakhapatnam
[2010 (256) ELT 696 (A.P.)]
13. Britannia Industries Ltd., Vs CC (Export), Mumbai
[2017 (357) ELT 1258 (Tri-Mum)]
14. York Export Vs CCE, Mumbai
[2004 (169) ELT 175 (Tri-Mum)]
15. Kanchan Oil Industries Ltd., Vs CC (Import), Kolkata
[2018 (7) TMI 279 - CESTAT-Kolkata
(5) Appeal No. C/1766,1767,
1777&1783/2012
Per contra, Learned DR asserts that the core issue in this case is whether or
not the appellant is eligible for the benefit of exemption notification No.
21/2002 as amended in respect of the oil imported under the five bills of
entry. The Port Health Officer is a Government Officer who has drawn
samples and has tested them and given reports which are in favour of the
assessee. The Department has also drawn samples in the presence of the
importer and sent them to the chemical examiner of the customs
department for testing. The reports of the chemical examiner show that
what was imported not of edible grade. Both are Government Chemists one
favouring the assessee, the other favouring the Revenue. He would assert
that exemption notification is an exception to the General Rule (that tax
must be paid) and hence it must be strictly considered against the assessee.
He would submit that several views were taken by various Judicial fora
including by the Hon'ble Apex Court as to how an exemption notification
should be constructed and interpreted. In view of the conflicting judgments
the matter was referred to Five Member Constitutional Bench of the
Supreme Court in the case of Dilip Kumar and Company & Others [2018
(361) ELT 577 (SC)] and it has been held as follows:
"52. To sum up, we answer the reference holding as under -
1) Exemption notification should be interpreted strictly; the burden
of proving applicability would be on the assessee to show that his case
comes within the parameters of the exemption clause or exemption
notification.
2) When there is ambiguity in exemption notification which is subject to
strict interpretation, the benefit of such ambiguity cannot be
claimed by the subject/assessee and it must be interpreted in
favour of the revenue.
3) The ratio in Sun Export case (supra) is not correct and all the
decisions which took similar view as in Sun Export case (supra) stands
overruled."
Thus the settled legal position is that the exemption notification must, in all
cases be strictly construed and any benefit of doubt must be given to the
Revenue and against the assessee.
7. He would submit that a case of conflict between two test reports came
before this Bench in the case of Kimmi Steels Pvt Ltd., [2019 (368) ELT 92
(Tri-Hyd)] where the assessee was entitled to the benefit of exemption
notification as per one test report and was not entitled to the benefit of the
exemption as per another test report. This Bench has doubted the
authenticity of both the test reports in that case and has decided the case by
denying the benefit of exemption notification to the assessee giving the
benefit of doubt to the Revenue following the ratio of the law laid down by
(6) Appeal No. C/1766,1767,
1777&1783/2012
the Constitutional Bench in Dilip Kumar (supra). He would submit that this
order was challenged before the Hon'ble Apex Court in Civil Appeal No.
11072/2019 which was dismissed by the Hon'ble Apex Court with the
following remarks:
"Delay condoned. We are not inclined to interfere with the impugned judgment and
order passed by the Tribunal. The civil appeal is dismissed accordingly. Pending
application, if any, stand disposed of."
8. Learned DR would urge us to follow the ratio of this decision in
deciding the present appeals also.
9. We have considered the submissions on both sides and perused the
records. The short point to be decided is whether the assessee is entitled to
the benefit of the exemption notifications claimed or otherwise. The original
authority, in his OIO (denovo) dated 27.7.2011, denied them the benefit of
the exemption notification in respect of all the bills of entry in these appeals
on the ground that the imported oil is not of Edible Grade. Para 23 of
the order of this order is reproduced below:
23. From the above discussion, I find that the Chemical Examiner's report prevails over
the PHO report inasmuch as the PHO report is for ascertaining and binding with regard
to importability or otherwise of the goods and whereas the Chemical Examiner's Report
clearly brings out the acid value/ carotenoid value of the subject goods. Further, in the
case of Kedia Overseas Ltd. vs CCE Vishakapatnam II reported in 2006 (205) ELT 576 (Tri-
Bang), the Hon'ble Tribunal has upheld the demand of differential duty on the imports of
Crude Palm oil, basing on the test results/ reports of the chemical Examiner which shows
the acid value is more than 10. In the instant case, the Chemical Examiner's report states
that the acid value of the subject imported goods is 10.8 which is more than the
standard value of 10 as prescribed under A 17.19 of PFA Rules, 1955. I further find that,
the subject goods failed to match the description/definition of edible grade as given in
the sub-note 1 of supplementary notes to Chapter note of Chapter 15. The Chapter note
is relevant for classification of the goods and their eligibility to concessional rate of duty
under notification no. 21/2002- Cus, dated 1.3.2002. Hence, the impugned goods cannot
be considered as 'Crude Palm oil of edible grade' and having failed to satisfy the
foremost inbuilt condition of Sl.No. 34(A) of the notification ibid. And hence, it is a
settled law that the benefits of the notification will be available subject to conditions
prescribed therein. Hence, the impugned goods are ineligible for the benefit of the
concessional rate of duty. Accordingly, I pass the following order.
10. Thus, holding that the imported palm oil is not of edible grade, he
denied the benefit of the exemption notification. However, he accepted the
test report of the PHO insofar as the importability is concerned. On appeal,
the Ld. First Appellate Authority allowed the benefit of exemption notification
partly only with respect to the bills of entry filed after 08.02.2005 on the
ground that in these cases, the samples satisfy both the acid value range
and carotenoid range. Revenue is in appeal against the benefit granted by
the First Appellate Authority with respect to the bills filed after 8.2.2005.
(7) Appeal No. C/1766,1767,
1777&1783/2012
11. It is not in doubt that there are two sets of test reports one by the
PHO certifying the goods to be of edible grade and another by the Customs
Laboratory stating that they are not of edible grade. Revenue wants to rely
on the Customs Laboratory test reports and deny the benefit of the
exemption notification because it is available to only palm oil of edible grade.
Assessee wants to rely on the PHO test report to argue that it was of edible
grade.
12. It is the case of the Revenue that the PHO's certificate is only with
respect to importability under Prevention of Food Adulteration Act and for
the purpose of exemption notification, Customs Laboratory's report should
prevail. It has also been canvassed on behalf of the Revenue before us that
if there are two conflicting test reports, the benefit of doubt, if any, cannot
go in favour of the assessee but should go in favour or Revenue as has been
held in the case of Dilip Kumar (supra) and Kimmi Steels (supra).
13. The assessee, on the other hand, argues that the PHO is the final
authority to decide about the edibility and his reports should prevail. The
assessee also argues that there was a delay of several days in the test
report of the Customs Laboratory which could have resulted in showing
excess acid value. It has also been argued that the oil was allowed to be
imported, refined and sold in the market as edible oil and they have
accordingly already refined and sold it.
14. We fully agree with the Revenue that any exemption notification must
be strictly construed against the claimant and in case of any doubt the
benefit of doubt must go to the Revenue and against the assessee. This is
the law laid down by the Constitutional bench of Hon'ble Supreme Court in
the case of Dilip Kumar (supra). Earlier, this bench had, in the case of Kimmi
Steels (supra) decided where there was a conflict between two reports that
the benefit of doubt must go to the Revenue and this decision has, on
appeal, been upheld by the Hon'ble Apex Court. However, that case involved
only test reports to determine the eligibility of the exemption notification. It
had no other implications.
15. The present case is different inasmuch as it involves testing for the
purpose of assessment. Assessment by Customs involves determining:
a) Classification of the goods;
(8) Appeal No. C/1766,1767,
1777&1783/2012
b) Importability of the goods with respect to restrictions under Section 11
of the customs Act, Foreign Trade Policy as well as several other laws
framed by various Ministries but enforced by the Customs officers:
c) Determining whether licences, permissions, authorisations, etc., if any,
required are fulfilled;
d) Determining the value of the goods;
e) Determining the rate of duty and exemption notifications.
16. It is possible that any consignment may match the requirements with
respect to one parameter of, say, importability but not others, say, the
exemption notification. Assessments in such a case have to be done
accordingly.
17. In this case, there are three issues (a) Importability under Prevention
of Food Adulteration Act; (b) Classification of the imported oil (as edible
grade or otherwise); (c) Eligibility of exemption notification which is
available for only edible grade oil and not otherwise. In terms of
importability under the Prevention of Food Adulteration Act as well as the
classification of the oil (as per the Supplementary note to the Chapter 15 of
Customs Tariff), the standards required are as laid down under A.17.19 of
the Appendix to the Prevention of Food Adulteration Rules. No specific
parameters have been laid down to determine if the oil is edible in the
exemption notification. However, the exemption notification required the
goods to fall under the particular tariff heading and hence the same standard
A 17.19 has been applied by the Assessing Officer while determining the
eligibility of exemption notification also.
18. Revenue has accepted the report of PHO that the imported goods meet
the standards of A17.19 insofar as the importability is concerned but has
rejected and held that it does not meet the same standards relying on the
said report of the Customs Laboratory with respect to the same
consignments as far as classification and exemption notification is concerned
in the same assessment which is incongruous. If Revenue had followed only
one set of reports for the entire assessment, they should have held that the
goods in question are not edible and hence not importable as well.
19. At this stage, it would be profitable to examine relevant provisions of
the Prevention of Food Adulteration Act. Section 5 of this Act reads as
follows:
(9) Appeal No. C/1766,1767,
1777&1783/2012
5. Prohibition of import of certain articles of food --
No person shall import into India--
(i) any adulterated food;
(ii) any misbranded food;
(iii) any article of food for the import of which a licence is prescribed, except in
accordance with the conditions of the licence ; and
(iv) any article of food in contravention of any other provision of this Act or of any rule
made thereunder.
20. The term adulterated is defined in Section 2 (ia) of the Act as follows:
(ia) "adulterated"--an article of food shall be deemed to be adulterated--
(a) if the article sold by a vendor is not of the nature, substance or quality demanded by
the purchaser and is to his prejudice, or is not of the nature, substance or quality which it
purports or is represented to be;
(b) if the article contains any other substance which affects, or if the article is so
processed as to affect, injuriously the nature, substance or quality thereof; (c) if any
inferior or cheaper substance has been substituted wholly or in part for the article so as
to affect injuriously the nature, substance or quality thereof;
(d) if any constituent of the article has been wholly or in part abstracted so as to affect
injuriously the nature, substance or quality thereof ;
(e) if the article had been prepared, packed or kept under insanitary conditions whereby
it has become contaminated or injurious to health;
(f) if the article consists wholly or in part of any filthy, putrid, , rotten, decomposed or
diseased animal or vegetable substance or is insect-infested or is otherwise unfit for
human consumption;
(g) if the article is obtained from a diseased animal;
(h) if the article contains any poisonous or other ingredient which renders it injurious to
health;
(i) if the container of the article is composed, whether wholly or in part, of any
poisonous or deleterious substance which renders its contents injurious to health;
(j) if any colouring matter other than that prescribed in respect thereof is present in the
article, or if the amounts of the prescribed colouring matter which is present in the
article are not within the prescribed limits of variability;
(k) if the article contains any prohibited preservative or permitted preservative in excess
of the prescribed limits;
(l) if the quality or purity of the article falls below the prescribed standard or its
constituents are present in quantities not within the prescribed limits of variability, but
which renders it injurious to health;
(m) if the quality or purity of the article falls below the prescribed standard or its
constituents are present in quantities not within the prescribed limits of variability but
which does not render it injurious to health:
(10) Appeal No. C/1766,1767,
1777&1783/2012
Provided that, where the quality or purity of the article, being primary food, has fallen
below the prescribed standards or its constituents are present in quantities not within
the prescribed limits of variability in either case, solely due to natural causes and beyond
the control of human agency, then, such article shall not be deemed to be adulterated
within the meaning of this sub-clause.
Explanation -- Where two or more articles of primary food are mixed together and the
resultant article of food--
(a) is stored, sold or distributed under a name which denotes the ingredients thereof;
and
(b) is not injurious to health, then, such resultant article shall not be deemed to be
adulterated within the meaning of this clause;
21. Thus, if any article of food does not meet the standards
specified under the Prevention of Food Adulteration Act and Rules it
is treated as adulterated even if it is not injurious to health as per
Section 2 (ia) and its import is therefore, prohibited under Section 5.
Section 6 of this Act makes all provisions of Customs Act applicable
to this Act and empowers the Customs officers to act against such
imports. Corresponding provisions of the Customs Act, 1962 are also worth
reading.
Section 5. Powers of officers of customs -
(1) Subject to such conditions and limitations as the Board may impose, an officer of
customs may exercise the powers and discharge the duties conferred or imposed on him
under this Act.
(2) An officer of customs may exercise the powers and discharge the duties conferred or
imposed under this Act on any other officer of customs who is subordinate to him.
(3) Notwithstanding anything contained in this section, Commissioner (Appeals) shall not
exercise the powers and discharge the duties conferred or imposed on an officer of
customs other than those specified in Chapter XV and section 108.
SECTION 110. Seizure of goods, documents and things - (1) If the proper officer has
reason to believe that any goods are liable to confiscation under this Act, he may seize
such goods:
Provided that where it is not practicable to seize any such goods, the proper
officer may serve on the owner of the goods an order that he shall not remove, part
with, or otherwise deal with the goods except with the previous permission of such
officer.
--------
SECTION 111. Confiscation of improperly imported goods, etc. - The following goods brought from a place outside India shall be liable to confiscation: -
(a)....(c)
(d) any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;
(11) Appeal No. C/1766,1767,
1777&1783/2012
SECTION 112. Penalty for improper importation of goods, etc.- Any person, -
(a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or
(b) who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111, shall be liable, -
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding the value of the goods or five thousand rupees, whichever is the greater;
(ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five thousand rupees, whichever is higher :
Provided that where such duty as determined under sub-section (8) of section 28 and the interest payable thereon under section 28AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent. of the penalty so determined;
(iii) in the case of goods in respect of which the value stated in the entry made under this Act or in the case of baggage, in the declaration made under section 77 (in either case hereafter in this section referred to as the declared value) is higher than the value thereof, to a penalty not exceeding the difference between the declared value and the value thereof or five thousand rupees, whichever is the greater;
(iv) in the case of goods falling both under clauses (i) and (iii), to a penalty not exceeding the value of the goods or the difference between the declared value and the value thereof or five thousand rupees, whichever is the highest;
(v) in the case of goods falling both under clauses (ii) and (iii), to a penalty 11[not exceeding the duty sought to be evaded on such goods or the difference between the declared value and the value thereof or five thousand rupees, whichever is the highest.
22. From the above, the legal position is evident as follows:
a) If the imported food (palm oil in this case) does not meet the standards of A.17.19 it is 'adulterated' as per the Prevention of Food Adulteration Act even if it is not injurious to health;
b) Therefore, import of such oil is prohibited under Section 5 of the Prevention of Food Adulteration Act;
c) All provisions of the Customs Act apply to such cases and Customs officers are empowered to Act with respect to such imported consignments under Section 6 of the Prevention of Food Adulteration Act;
d) In terms of Section 111 (d) of the Customs Act, such oil is liable to be confiscated for being imported in contravention of the prohibition under Section 5 of the Prevention of Food Adulteration Act;
e) Such oil can be seized under Section 110 of the Customs Act by the proper officer of Customs
f) Any person concerned with such import is also liable for penalty under Section 112 of the Customs Act
23. Thus, determining the importability of the oil in question and if it is not importable, acting against the imported goods and the importer is the responsibility of the Customs officers. No action has (12) Appeal No. C/1766,1767, 1777&1783/2012 been initiated in the imports which are the subject matter of these appeals because the Revenue accepted the test report of the PHO that it meets the standard as per A 17.19 of the Appendix to the Prevention of Food Adulteration Rules. This is also explicit in the denovo order of the original authority. Having accepted that the consignment meets this standard, Revenue took a diametrically opposite stand with respect to the same consignments and the same standards while determining the eligibility of the exemption notification. In our considered view, such as a contradictory stand is not sustainable.
24. The assessing officer cannot hold that the consignment meets standard as per A17.19 while deciding the importability and hold that it does not meet the same standards while deciding the eligibility of the exemption notification. It would have been a different case if the standards prescribed for the exemption notification are different from that for determining the importability but such is not the case.
25. In view of the above, we find that Revenue, having accepted that the consignments meet standards A17.19 and hence are edible and accepting their importability cannot take a stand that the consignments do not meet the same standards and are therefore not edible, while deciding the eligibility of exemption notifications.
26. Appeals filed by the assessee are allowed and appeal filed by the Revenue is rejected with consequential relief to the assessee appellant.
(Order pronounced on 12.06.2020 in open court) (ANIL CHOUDARY) MEMBER (JUDICIAL) (P. VENKATA SUBBA RAO) MEMBER (TECHNICAL) Jaya