Case Law Details
M/s Nava Bharat Agro Products Ltd Vs Commissioner of Customs, Central Excise & Service Tax (CESTAT Hyderabad)
The main issue to be adjudicated is whether palm oil fruit is a fruit entitled for the exemption of Notification No. 33/2004-ST dated 03.12.2004. Apparently, notification is silent about any definition or the classification of fruit and all other products mentioned therein.
However, from the Stroud’s Judicial Dictionary of words and phrases it is clear that the term ‘fruit’, in legal acceptation, is not confined to the produce of those trees which in popular language are called fruit trees, but applies also to the produce of oak, elm and walnut trees.
The conjoint reading of all these definitions led us to form the opinion that any produce of a tree which is the result of ripened ovary, irrespective of nature of it being edible or not, amounts to fruit. Admittedly, the product transported in the present appeal is palm oil fruit. The photographs as produced by the appellant during the arguments also support the opinion as formed by us. We are, therefore of the opinion that the fruit in question is very much covered by the notification. The adjudicating authorities below are therefore held to have formed a very rigid and narrow description of the fruit. Resultantly, the impugned order is set aside and the appeal is hereby allowed with consequential relief.
FULL TEXT OF THE CESTAT JUDGMENT
1. This appeal is filed against Order-in-Appeal No. 26/2011 (G) ST dated 14.06.2011.
2. The appellant herein are the manufacturers of crude palm oil. They are extracting oil from the fruits of palm trees and as such palm oil fruits are the inputs for the appellant. They are availing Goods Transport Agency services for getting the said inputs. The department, on the basis of intelligence, was of the opinion that the appellant need to take the registration for discharging the liability on the Goods Transport Agency services being received by them. On the said emphasis the appellant got the registration on 25.03.2009 and paid Rs.74,143/- towards service tax on 31.08.2009 for the period 2005-2008. However, the ST-3 returns were not filed by them for the said period. The demand is for the period April, 2005 to September, 2009. Resultantly, vide show cause notice No. 42 dated 22.04.2010 the department proposed demand of Rs.1,32,029/- plus Cesses of Rs.2,641/- and Rs.406/- along with the interest at the appropriate rate and proportionate penalties. The said proposal was initially confirmed by Order-in-Original No.17/2010-ST dated 26.11.2010. The appeal thereof was rejected vide the Order-in-Appeal No. 26/2011 dated 14.06.2011. Being aggrieved the appellant filed an appeal before this Tribunal.
3. We have heard the parties. It is submitted on behalf of the appellant that Goods Transport Agency services as availed by the appellant is with respect to the transport of palm oil fruit. The transport of fruits is exempted from levy vide Notification No. 33/2004-ST dated 03.12.2004. It is submitted that adjudicating authorities have declined the benefit of said notification to the appellant on the ground that the palm oil fruit is not edible though it is admitted to be a fruit. The findings are therefore alleged to be apparently wrong and are prayed to be set aside.
4. While rebutting these arguments it is submitted on behalf of the department that what actually has been transported is palm oil which is not covered under the said Notification. Otherwise also, the fruit from which the oil is extracted is not edible and as per the dictionary meaning of fruit, “anything which is not edible cannot be classified to be called as fruit.” Thus, there is no infirmity in the Order-in-challenge. Appeal is prayed to be dismissed.
5. After hearing both parties, we are of the opinion as follows:
The main issue to be adjudicated is whether palm oil fruit is a fruit entitled for the exemption of Notification No. 33/2004-ST dated 03.12.2004. Apparently, notification is silent about any definition or the classification of fruit and all other products mentioned therein. Thus, for the literal meaning of the fruit, we have to bank upon the dictionary meaning of the fruit, as has also been appreciated by the Commissioner (Appeals), as follows:
“The meaning of ‘fruit’ is defined as follows:
As per Oxford Dictionary:
The ripened ovary or ovaries of a seed-bearing plant, together with accessory parts, containing the seed and occurring in a wide variety of forms.
An edible, usually sweet and fleshy form of such a structure.
A part or an amount of such a plant product, served as food: fruit for dessert.”
However, from the Stroud’s Judicial Dictionary of words and phrases it is clear that the term ‘fruit’, in legal acceptation, is not confined to the produce of those trees which in popular language are called fruit trees, but applies also to the produce of oak, elm and walnut trees.
6. The conjoint reading of all these definitions led us to form the opinion that any produce of a tree which is the result of ripened ovary, irrespective of nature of it being edible or not, amounts to fruit. Admittedly, the product transported in the present appeal is palm oil fruit. The photographs as produced by the appellant during the arguments also support the opinion as formed by us. We are, therefore of the opinion that the fruit in question is very much covered by the notification. The adjudicating authorities below are therefore held to have formed a very rigid and narrow description of the fruit. Resultantly, the impugned order is set aside and the appeal is hereby allowed with consequential relief.
(Dictated and pronounced in the open Court)
