1995 (3) TMI 117 - SC - Customs

Whether Tungsten wire imported by the respondent can be classified as electrical resistance wires for the purpose of payment of customs duty under Item 73(23) in Section XVI of the First Schedule of the Indian Customs Tariff which was prevalent during the period 1972 to 1975 when the said imports were made? Held that - The expression electrical resistance wires in Item 73(23) has to be read along with the Nichrome which precedes that expression and, if thus read, it can only mean electrical wires having characteristics similar to those of Nichrome, namely, high resistivity. Keeping in view the low resistivity of Tungsten wire it cannot be regarded as electrical resistance wire falling under Item 73(23). No force in these appeals and the same are liable to be dismissed.

Summary

Issues:
1. Classification of Tungsten wire for customs duty under Item 73(23) or Item 70(1) of the Indian Customs Tariff.
2. Interpretation of the expression 'electrical resistance wires' in Item 73(23) of the Tariff.
3. Validity of the High Court's judgment regarding the classification of Tungsten wire.
4. Refund of duty based on changes in the law.

Detailed Analysis:
1. The appeals before the Supreme Court revolved around the classification of Tungsten wire for customs duty payment under Item 73(23) in Section XVI of the Indian Customs Tariff. The dispute arose as the Revenue contended that the Tungsten wire imported should be classified as 'electrical resistance wires' under Item 73(23), while the respondent argued for classification under Item 70(1) in Section XV. The Customs authorities had classified it under Item 73(23), but the High Court disagreed, leading to the appeals.

2. The interpretation of the expression 'electrical resistance wires' in Item 73(23) was crucial in determining the classification of the Tungsten wire. The High Court analyzed the characteristics of electrical resistance wires, emphasizing high resistance to electric current. It considered the resistivity levels of various materials, including Tungsten, and concluded that Tungsten wire, with its low resistivity, did not qualify as an electrical resistance wire under Item 73(23).

3. The High Court's judgment, which held that Tungsten wire should not be classified under Item 73(23) but under Item 70(1), was challenged in the appeals before the Supreme Court. The Revenue argued that Tungsten wire, given its resistance and usage in incandescent lamps, should be classified as electrical resistance wire. However, the Supreme Court upheld the High Court's decision, supported by technical certificates stating that Tungsten wire used for filaments did not qualify as resistance wire.

4. Additionally, the issue of refund of duty arose due to changes in the law, specifically amendments to the Customs Act, 1962. The respondent sought a refund based on the High Court and Tribunal judgments. The Supreme Court dismissed the appeals but left the question of refund open, stating that any such claim would need to be evaluated in accordance with the law, considering the amendments to the Customs Act.

In conclusion, the Supreme Court affirmed the High Court's decision that Tungsten wire did not fall under the classification of electrical resistance wire under Item 73(23) of the Indian Customs Tariff. The judgment provides a detailed analysis of the technical aspects and legal interpretation involved in classifying imported goods for customs duty purposes, emphasizing the importance of accurate classification and adherence to statutory provisions.