Judgment:
1. This appeal has been filed against the order-in-appeal passed by the Collector (Appeals) Allahabad dated 30-11-1994 confirming the order-in-original of Assistant Collector dated 17-4-1984. The question raised is whether rice bran oil is a vegetable oil for purposes of the Vegetable Oils Cess Act, 1983.
2. By show cause notice dated 13-3-1987 the appellants before us were called upon to show cause as to why a duty of Rs. 2,46,610.50/- should not be demanded from them towards cess on rice bran oil produced by them. Appellants contested the demand before the Assistant Collector.
The Assistant Collector rejected their contentions and confirmed the demand. In the impugned order, Collector (Appeals) concurred with the findings of the Assistant Collector. Hence this appeal.
3. Appellants contend that rice bran oil is not a vegetable oil assessable to cess under the Vegetable Oils Cess Act, 1983 for the following reasons : (a) Rice bran oil is extracted by solvent extraction process from rice bran; (b) Rice bran oil so extracted is not fit for human consumption and is used for industrial purposes only; (c) The object of enacting Vegetable Oils Cess Act was for purposes of the National Oil Seeds and Vegetable Oils Development Board Act, 1983; (d) The Allahabad High Court by its Order dated 22-12-1987 had clearly held that rice bran oil is not subject to levy of cess under the Vegetable Oils Cess Act; (e) That the finding of the lower authorities that rice bran is a product of plant origin has no force in view of the judgment of the Allahabad High Court; (f) That in any event the demand was barred by limitation as having been made beyond six months.
4. Appearing before us counsel for the appellants drew our attention to the decision of the Allahabad High Court in Writ Petition No. 793/84 in UPSE Association v. UOI [reported in 1989 (39) E.L.T. 18 (All.)] in which the Hon'ble High Court had considered the specific question of whether rice bran oil is a vegetable oil for purposes of the Vegetable Oils Cess Act, 1983. Hon'ble High Court had upheld the contention of the petitioners and directed the Collector of Central Excise not to realise any cess from Members of the U.P. Solvent Extraction Association on oil produced from rice bran oil. Defending the impugned order the D.R. submitted before us that the Supreme Court had in their judgment in 13-4-1994 had not excluded rice bran oil from the definition of oil. The D.R. reiterated the findings of the Collector (Appeals) in the impugned order stating that since rice bran is a material of plant kingdom it is not a synthetic product and therefore it cannot be called goods of industrial origin and therefore has to come within the definition of vegetable oil for purposes of cess under the aforesaid Act.
5. We have considered the rival contentions. We find that the issue whether rice bran oil is a vegetable oil for purposes of levy of cess under the Vegetable Oils Cess Act, 1983 was examined in detail by the Allahabad High Court in its decision referred to above. The relevant portion of the Hon'ble High Court judgment is extracted below : "The question is whether the petitioners who extracted oil from rice bran could be suspected to cess under Section 3 of the Vegetable Oils Cess Act, 1983. Levy under Section 3 of the Act is on vegetable oils. Although vegetable oil 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 Oil Seeds and Vegetable 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 Oilseeds and Vegetable Oils Development Board Act, 1983 reads as under:- "(h) Vegetable Oil means any oil produced from oilseeds, or any other oil bearing material of plant origin, and containing Glycerides but does not include any such vegetable oil which has been subjected to any processing subsequent to the recovery of oil." 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); harbaccous plant (as the cabbage, potato or turnip). In Encyclopedia Britan-nica the description of vegetable runs thus; 'In its broadest sense, refers to any kind or plant life or product.
However, in common narrow usage vegetable usually refers to fresh edible portion of a herbaccous plant-roots, stems, leaves, flowers or fruits'. In Ram Avtar Badri v. Assistant Sales Tax Officer [XIII S.T.C. (S.C.) p 286] the Hon'ble Supreme Court approved the decision of Madhya Pradesh High Court that the word vegetable in a fiscal statute could not 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.
It cannot, however, be disputed that it is open to the 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 obtained 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 a same sense. According to it oil produced from oilseeds 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 bearn, sesame, cotton seed, linseed, rapeseed. Rice bran is a by-product of rice. It is not a seed capable of germinating into another plant. Even rice out of which it is obtained 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 a 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 yound tree, vine, shrub, or herb planted or suitable for planting a vegetable, flower, fruit.' Therefore, stems, roots, barks, leaves or even wood may be included or deemed to be of plant origin. But not the rice bran which is a waste or 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." 6. In view of the foregoing, we hold that rice bran oil is not vegetable oil for purposes of the Vegetable Oils Cess Act, 1983. The order of the Supreme Court referred to by the D.R. does not go into the question of assessability of rice bran oil.