Import No. ______________

Export No. ______________

PUBLIC NOTICE NO. :- 115/2001 Date: 15.10.2001

SUB: Clearance of vegetable oils imported for industrial purposes at concessional rate of duty under notification No. 17/2001-Cus, dated 01.03.2001 – Reg.
Attention is invited to Board ‘s Notification No. 17/2001 dated 01.03.2001 regarding import of Vegetable Oil at a concessional rate of duty for industrial purpose. Varying practices being adopted by Custom Houses in the matter of interpretation of notification No. 17/2001 – Cus., dated 01.03.2001, in regard to import of vegetable oils specially Crude Palm Oil claimed to have been imported for industrial purposes have been brought to Board’s notice. Whereas, in some concessional rate of duty of 35% treating the Crude Palm Oil imported as other than Edible Oil, doubts have been raised about admissibility of this concessional rate at certain other Custom Houses taking into account the Board’s instructions issued under Circular No. 29/97-Cus., dated 31.07.1997. It has been argued that as per the said circular even though the Crude Palm Oil imported as such, considering the composition, Free Fatty Acid / Acid content may not qualify to be termed as Edible Oil under the Prevention of Food Adulteration Act, 1954, but since the oil imported can be made fit for human consumption after further processing, it has to be considered as vegetable oil of Edible Grade – having due regard to the Board’s said circular. With a view to ensure that the benefit of the concessional rate of 35% where claimed for Crude oils is extended only where the actual use is shown to be for industrial application to the satisfaction of the proper officer, the matter has been re-examined by the Board, and it has been decided that the following procedure / guidelines may be followed:-

(a) For consignments of vegetables oils, where the importers claim concessional rate of duty of 35% as applicable for oils other than edible oils, samples may be sent for testing to see whether the oil conforms to standards of Prevention of Food Adulteration Act, 1954. If it is found that the vegetable oil conforms to the standards of Prevention of Food Act.

(b) In case on test, it is found that vegetable oil does not conform to the standards of Prevention of Food Act, 1954 and acid value & Free Fatty Acid are higher than the permissible limits (i.e. 35% and allowed to be moved on execution of a bond for establishing the end use of the oil for actual manufacture of soap or other industrial use as claimed. The bond should cover the differential is by an actual user manufacturer, a security / Bank Guarantee amounting to 25% of the bond value may be taken. However, where the import is not for actual use but for trading and sale to actual industrial users, the concessional rate may be extended on provisional basis but the amount of security / Bank Guarantee should be equal to bond value, i.e. 100% of the differential duty liablitt between the industrial and edible grade oil.

2. The bond shall be discharged and security / Bank Guarantee released when the actual end use certificate from the Assistant / Deputy Commissioner of Central Excise having the jurisdiction over the factories of soap manufacturers (or other industrial applications for which the vegetable oil is claimed to have been used), is produced to the Customs authorities within a period of 3 months or a period as may be extended by the Commissioner of Customs on being requested by the importers. In case, such certificate is not produced to Customs within 3 months or period as extended by the Commissioner of Customs, immediate action for recovery of differential amount will be initiated.

3. All the Public Notices issued in this matter which are not in consistent with the subject Public Notice shall be treated as modified to the extent above and the provisions of this Public Notice will prevail.

4. The associations concerned are requested to bring the contents of this notification to the notice of their members / manufacturers in particular and trade in general.

(M. C. THAKUR)
COMMISSIONER OF CUSTOMS (IMPORT)
NEW CUSTOM HOUSE, MUMBAI.

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