G. Sankaran, Member (T)

1. This is an appeal filed by M/s. Radhika Vitamalt Pvt. Ltd., New Delhi (hereafter referred to as "the appellants") against Order-in-Original No. 14-COLLR/1984 dated 25-7-1984 passed by the Collector of Central Excise, Meerut by which the Collector held that zinc sulphate, manufactured by the appellants, was not a fertilizer falling under Item No. 14-HH of the First Schedule to the Central Excises Salt Act (CET, for short) but a micronutrient falling under Item No. 68, CET. The Collector directed the Assistant Collector to work out the actual duty payable by the appellants under Central Excise Rule 9(2) after taking into account all their factories and the exemptions under Item 68. However, he did not impose any penalty under Rule 173-Q on the appellants.

2. The charge against the appellants was that they were engaged in the manufacture of zinc sulphate without applying for and obtaining a central excise licence and had manufactured and removed the product valued at Rs. 57,51,675.00 during the period from 1-10-1978 to 31-12-1979 without payment of excise duty, without cover of proper documents and without following the procedure prescribed under the Central Excise Rules (hereafter referred to as "the Rules"). The case, thereafter took a chequered turn. The matter was adjudicated by the Collector. However, the Order was set aside by the appellate authority, the Central Board of Excise Customs, who remanded the matter to the Collector for de novo adjudication after affording the party an opportunity to present their case. In its Order of remand, the Board observed that "the important considerations to determine the classifiability of a product should be the commercial meaning assigned to the goods, the technical definition and categorisation of the product as available in various technical books of references or statutory Acts and Orders and the fact of actual marketing or marketability."

3. The impugned order is the result of the de novo adjudication of the case by the Collector. In his Order, the Collector has observed that zinc sulphate helps in the overall growth of plants but does not affect the fertility of the soil. According to the "Wealth of India", the term "fertilizer" is ordinarily applied to materials which are added to soils to increase the supply of plant nutrients and thereby enhance the fertility of the soil. Materials which improve soil texture are distinguishable from fertilizers as soil improvers. The Collector also refers to the definition of "fertilizer", "nutrient" and "micronutrient" in various authorities and concludes that a fertilizer should contain one or more of the elements most essential for plants, viz. nitrogen, potassium and phosphorous. On the other hand, micronutrients are required in very small quantities and are comparatively less essential. They assist in dispersion and assimilation of food material (fertilizer). Though micronutrient is covered under the Fertilizer Control Order and there is an ISI specification for the same, in composition and usage, it is different from the usual fertilizers containing nitrogen, phosphorous and potassium. It has got many other uses such as pesticide, weedicide and as industrial chemical. The Collector says that the product cannot be treated as a fertilizer merely on the ground that it is sold as fertilizer or used by the buyers in farming.

4. In arriving at the decision that Item 14-HH ("fertilizers, all sorts") would not cover micronutrients, the Collector derived support from the Gujarat High Court decision in Shri Vallabh Glass Works Ltd. v. Union of India-1979 ELT J-608, and the Madras High Court decision in Parry Confectionery Ltd. v. Government of India-1980 ELT 468, in which the Courts had held that "merely because the heading of the tariff entry was wide, it would not mean that it would cover all types of commodities which would be covered by the general heading unless specific provision was made for those different p