Allahabad High Court
U.P. Solvent Extractors' Association vs Union Of India (Uoi) on 22 December, 1987
Equivalent citations: 1988(17)ECC27, 1989(39)ELT18(ALL)
Author: R.M. Sahai
Bench: R.M. Sahai
JUDGMENT R.M. Sahai, J.
1. UP. Solvent Ext4ractors' Association, Kanpur, have approached this Court by way of this petition for direction to opposite parties not to enforce the provisions of Vegetable Oils Cess Act, 1983 to industries employing solvent extraction plant technology for purpose of extracting oil from the rice bran as its raw material since the Act was not applicable to them.
2. Oil is extracted by process of solvent extraction plant using rice bran procured from rice mills as raw material. What is rice bran is explained thus. After husk has been taken off from the paddy the rice is made available. This rice is further subjected to processing by the rice mill and by its technical process the upper brownish part of the rice is taken out and stored in the form of powder and the same is called as rice bran. In Survey of India Export Potential of OB Cakes Vol. IV. p. 1, rice bran is described as under :
"Rice bran is a by-product of rice (paddy) and is the basic raw material for rice bran oil. During the process of rice milling, the layer round the endosperm is removed together with a portion of the polishing. This separated layer is called 'rice bran'. The quantity of rice bran obtained is variable as it depends upon the degree of polishing. Bran constitutes roughly 6 to 10 per cent of paddy rice."
The oil is produced from it by mixing liquid hezane, a highly inflammable petroleum product so that the rice bran may dissolve in it and thereafter both are separated and oils is extracted from the rice bran so dissovled. The oil extracted is used for manufacturing soap. It is not fit for human consumption. The question is whether the petitioners who extracted oil from rice bran could be subjected to a cess under Section 3 of the Vegetable Oils Cess Act, 1983. Levy under Section 3 of the Act is on vegetable oils, although vegetable oils has not been defined but Section 2(2) provides that words and expressions used but not defined in the Act but defined in the National Oils Seeds and Vegetables Oils Development Board Act, 1983, shall have the meanings respectively assigned to them in that Act. The definition of vegetable oil under Section 3(h) of the National Oil Seeds and Vegetable Oils Development Board Act, 1983 reads as under:
"(h) Vegetable oils' means any oil produced from oilseeds, or any other oil bearing material of plant origin, containing glycerides but does not include any such vegetable oil which has been subjected to any processing subsequent to the recovery of oil."
3. Prior to examining the expression, "oilseeds or any other oil bearing material of plant origin" used in this clause it would not be out of place to understand the common or popular meaning of vegetable oil. Vegetable according to Webster Third International Dictionary means, "relating to plants, having the nature of or produced by plants; made from plant; resembling or suggesting a plant; an edible part of a plant usually (as seeds, leaves or roots); herbaceous plant (as the cabbage, potato, or turnip). In Encyclopaedia Britanica the description of Vegetable runs thus: In its broadest sense, refers to any kind of plant life or product. However, in common narrow usage vegetable usually refers to fresh edible portion of a herbaceous plant roots, stems, leaves, flowers or fruits".
In Ram Avtar Budhaiprasad v. Assistant Sales Tax Officer [1962] 12 STC 286 (SC) the Hon'rjle Court approved the decision of Madhya Pradesh High Court that the word vegetable in a fiscal statute could not be given the meaning the term bears in natural history. It should be as commonly understood. It is thus obvious that rice bran cannot be included in the word "vegetable" either in dictionary meaning or popular, common or commercial sense.
4. It cannot, however be disputed that it is open to Legislature to give an artificial meaning to a word. Therefore, if oil extracted from rice bran can be included in the word vegetable oil as defined in the Act, the petitioner cannot escape liability of paying cess. Vegetable oil has been defined in Webster to mean oil obtaining from plant specially fatty oil obtained usually from seeds and nuts. The definition of vegetable oil extracted earlier also appears to have been used in same sense. According to it oH produced from oil seed or oil bearing material plant and containing glyceride is vegetable oil. Seed according to dictionary means a flowering plant or germ capable of developing into another such plant. And oil seed is defined in Webster as any of various seeds grown largely for oil as castor bean, sesame, cotton seed, linseed, rapeseed. Rice bran is a by-product of rice. It is not seed capable of geminating into another plant. Even rice out of which it is obtaining is not considered to be seed from which oil is extracted either in technical or commercial sense. Rice bran, therefore, cannot be considered to be oil seed. Nor can rice bran be considered to be, "oil bearing material of plant origin". It is by-product obtained as a result of polishing of rice in mills. What may be of plant origin may be paddy not the rice bran. Plant according to dictionary means, "a young tree, vine, shrub, or herb planted or suitable for planting a vegetable, flower, fruit'. Therefore, stems, roots, barks, leaves or even weed may be included or deemed to be of plant origin. But not the rice bran which is at worst is a by-product. Since rice bran is not covered by either of the characteristics given to vegetable oil no cess was leviable from persons who extracted oil from rice bran.
5. Preliminary objection of opposite party that petition is not maintainable as the Association is not registered cannot be accepted, in view of widening of concept of locus standi.
6. In the result this petition succeeds and is allowed. A direction is issued to opposite parties not to realise any cess from members of petitioners' association on oil produced from rice bran. There shall be no order as to costs.