1991 (5) TMI 265 - AT - Central Excise

Summary

Issues Involved:
1. Interpretation of Notification No. 125/86-Cus.
2. Applicability of Serial No. 17, 18, and 19 of Notification No. 125/86-Cus.
3. Whether the word "and" should be read as "or" in the context of the notification.
4. Relevance of subsequent Notification No. 65/89-Cus.
5. Concessional rate of duty eligibility for the imported machine.

Issue-wise Detailed Analysis:

1. Interpretation of Notification No. 125/86-Cus.:
The appellants imported a form, fill, and seal (FFS) packaging machine with gas flushing but without a vacuumising facility. They sought concessional assessment under Notification No. 125/86-Cus., which includes Serial Nos. 17, 18, and 19. The Assistant Collector and Collector of Customs (Appeals) denied the benefit under Serial No. 17, which requires both vacuumising and gas flushing facilities. The appellants argued that the notification should be interpreted to allow machines with either facility, not necessarily both.

2. Applicability of Serial No. 17, 18, and 19 of Notification No. 125/86-Cus.:
Serial No. 17 specifies "FFS with vacuumising and inert gas flushing." Serial No. 18 pertains to "Gas flush packing system for flexible packages," and Serial No. 19 covers "Gas and vacuum packaging system for flexible packages." The appellants contended that their machine should qualify under Serial No. 17 or alternatively under Serial No. 18. The Collector (Appeals) upheld the Assistant Collector's decision, stating that Serial No. 17 requires both facilities.

3. Whether the word "and" should be read as "or" in the context of the notification:
The appellants argued that the word "and" in Serial No. 17 should be interpreted as "or" to reflect the legislative intent and avoid absurd results. They cited various legal precedents and statutory interpretation principles, emphasizing that the word "and" can be read as "or" to align with the context and purpose of the legislation. The Tribunal agreed, noting that interpreting "and" as "or" would prevent irrational outcomes and align with the intent behind the notification.

4. Relevance of subsequent Notification No. 65/89-Cus.:
The appellants highlighted Notification No. 65/89-Cus., which amended Serial No. 17 to explicitly state "FFS with either vacuumising or inert gas flushing or both." They argued that this amendment clarified the government's intent, supporting their interpretation. The Tribunal found this argument persuasive, indicating that the subsequent notification shed light on the original intent of Notification No. 125/86-Cus.

5. Concessional rate of duty eligibility for the imported machine:
The Tribunal concluded that the appellants were entitled to the benefit of Notification No. 125/86-Cus. by interpreting "and" as "or." This interpretation aligned with the legislative intent and avoided absurd results. The Tribunal set aside the impugned order and allowed the appeal, granting the appellants the concessional rate of duty for their imported FFS machine with gas flushing.

Conclusion:
The Tribunal allowed the appeal, interpreting the word "and" in Serial No. 17 of Notification No. 125/86-Cus. as "or," thus extending the benefit of the notification to the appellants' imported machine. The decision emphasized the importance of aligning statutory interpretation with legislative intent and practical realities.