Andhra HC (Pre-Telangana)
The Andhra Pradesh Rice Bran Solvent ... vs Union Of India (Uoi) And Ors. on 21 April, 1988
Equivalent citations: AIR1989AP284, 1992(39)ECC149, 1988(19)ECR452(AP), 1988(37)ELT198(AP), AIR 1989 ANDHRA PRADESH 284, (1988) 19 ECR 452, (1988) 37 ELT 198, (1988) 2 LS 57
JUDGMENT P.A. Choudary, J.
1. The petitioner in this writ petition is the Andhra Pradesh Rice Bran Solvent Extractors Association. It challenges the validity of imposition of cess by the Union of India under Section 3 of the Vegetable Oils Cess Act (Act 30 of 1983) on the bran oil produced by its members out of the rice bran by the method of solvent extraction. The members of the petitioner-association own rice bran solvent extraction mills. They manufacture rice bran oil out of the rice bran through the process of solvent extraction. Rice bran is itself extracted from rice which is produced from paddy by removing the husk. Of course paddy is produced from a plant.
2. The Union Parliament in exercise of its powers under entry 52, List I of the VII Schedule enacted the National Oilseeds and Vegetable Oils Development Board Act (Act 29 of 1983). The object of the enactment is to provide for the development of the oilseeds industry and the oils industry. In order to reach those goals the Act, authorised the Constitution of a Board with necessary statutory powers and functions to be exercised by the Board. Section 9 of the Act enumerates the functions of the Board, Under that section the duty of the Board is to promote development of the oilseeds industry and the vegetable oils industry. It is clear that the
-running of the Board requires monies to be spent. The question who should pay for the running of the Board is answered by the companion legislation Act No. 30 of 1983 called the Vegetable Oils Cess Act passed by the Parliament. The latter Act seeks to raise these monies at least in part from the manufacturers of vegetable oils who will be the beneficiaries in some direct way of the activities of the Board. Section 3 of the Act 30 of 1983, therefore, authorises the Government to levy and collect by way of cess for the purposes of the National Oilseeds and Vegetable Oils Development Board Act, 1983, a duty of excise on vegetable oils produced in any mill in India at such rate not exceeding five rupees per quintal of vegetable oil, as the Central Government may, from time to time, specify by notification in the Official Gazette.
It appears from the affidavit that the Central Government in exercise of its statutory powers has issued a notification and imposed a cess of Re. 1/- per quintal on rice bran oil. When the Government is attempting to collect the cess from the manufacturers of bran oil, the petitioner-Association has filed this writ petition on behalf of its members, who are producing rice bran oil and who are asked to pay the aforementioned cess imposed by the Central Government under Section 3 of Act 30 of 1983.
3. The scope of this writ petition is limited to finding out whether bran oil is produced from oil yielding material of plant origin.
4. The only argument advanced by the learned counsel for the petitioner is that the imposition of cess under Section 3 on the bran oil is not authorised by the provisions of Act 30 of 83 read with Act 29 of 1983. There is no doubt that Section 3 of Act 30 of 1983 authorised the imposition of cess only on vegetable oils produced in a mill. The argument of the petitioner is that the bran oil is not a vegetable oil within the meaning of these Acts. Act 30 of 1983 does not define the word 'vegetable oil' but refers to Act 29 of 1983 for the meaning of that word. In Section 3(h) of Act 29, 1983 the word 'vegetable oil' is defined to mean any oil produced from oil seeds or any other oil bearing material of plant origin. The question is whether rice bran out of which rice bran oil is produced is an oil-bearing material of plant origin. It is nobody's case that the rice bran oil is produced from any seeds. Nor can any one contend to the contrary that rice bran is an oil yielding material. The only question that is raised and argued is whether rice bran is of plant origin. The argument of the petitioner is that the rice bran oil is produced from the rice bran and that rice bran is in turn produced from the rice and not from paddy and that therefore the rice bran oil cannot be said to be produced from oil bearing material of plant origin. Thus the short question is whether the production of rice bran oil falls within the definition of Section 3( h) of Act 29 of 1983.
5. The definition section speaks of material of plant origin. In terms of that definition what we have to find out is the genealogical origin of rice bran. The word origin means ancestry rise of sourse. Clearly rice bran has its origin in paddy. Without paddy there can be neither rice nor rice bran. But according to the petitioner's argument the search for the origin of rice bran should stop with rice and should not go to paddy: We are of the opinion that neither in the text nor in the context there is any justification for this reasoning of the petitioner. On the other hand it does violence to the language used by the statute in its definition. Plant origins of which the definition speaks of can be found only in the beginning and not at intermediary stage. The words plant; origin require us to trace the genealogical origins of rice bran to paddy. They would not permit us to stop the investigation into the origins of rice bran at the stage of rice which undoubtedly is the immediate and intermediate source fpr the production of the rice bran. But rice bran is an integral part of paddy which is undoubtedly of plant origin.
Removing husk by which rice is produced and out of which rice bran is produced is not a chemical process. It is merely a physical act of separating some parts Of rice which conies out of paddy. The words in the definition requires us to find out the plant origin of the oil bearing rice bran. What Section 3(h) of Act 30 of 1983 says is that imposition of cess should be confined only to vegetable oils produced out of material of plant origin and should not extend to oils produced from materials of mineral origin or animal origin.
6. Judge Bork says to specify something is simultaneously to give it not only content but by the same process to give it limits. In that view we held rice bran oil which is the product of rice bran is produced out of material of plant origin. We, therefore, reject the contention of Mr. K. Subrahmanya Reddy, learned counsel for the petitioner that rice bran should not be considered as a material of plant origin.
7. The learned counsel cited several cases arising under the Sales Tax Acts of the States.
He referred to the decisions in Commr. of Sales-tax v. Naveen Traders, (1975) 36 STC 440 (All); Ganesh Trading Company v. State of Haryana, ; Chordia Kavelu Udyog v. State of M.P., (1988(69) STC 49) (Madh Pra) and Babu Ram Jagdish Kumar and Co. v. State of Punjab. . In our opinion none of these cases are of any help to us to decide the question which has been raised in this writ petition. In the cited cases, which arose under the respective Sales tax Laws, the various laws have made several distinctions between the rice bran, husk;
paddy, rice and other materials for the purpose of imposition of sales tax. In that connection courts have held that the rice bran is not the same as husk and that paddy and rice are not one arid the same. They are of the slightest relevance to find out whether the oil yielding rice bran is of plant origin. Such a question, in our opinion, cari be decided not by the decisions interpreting Sales Tax Act but only by attending to the language and context of the present Act. The rule that the nomenclature used by the Sales Tax Acts should be understood in popular sense and not in technical sense can have no application here. The cases in State of West Bengal v. Wasi Ahmed, and Mukesh Kumar Agarwal v. State of M.P., cannot be of any use to us. This is entirely a different question from the one with which we are concerned. Here the question is, as stated above, whether the rice bran is an oil yielding material of plant origin. The answer in our opinion can only be in the affirmative. For these reasons, we do not find any merit in this writ petition. The writ petition fails.
8. Subject to the condition that the petitioners renew their bank guarantees before they expire, the Government is restrained from encashing the bank guarantees from period of three months.
9. The writ petition is dismissed with costs. Advocate's fee Rs. 250/-.
Mr. Subrahmanya Reddy, learned counsel for the petitioner, has made an oral application for grant of a certificate to enable the petitioners to prefer an appeal to the Supreme Court. We are unable to certify that this caw involves a substantial question of law which needs to be, decided by the Supreme Court, The oral application is rejected.