1974 (7) TMI 57 - HC - Central Excise

Summary

Issues:
1. Whether wafers are considered biscuits under the Central Excise and Salt Act, 1944.

Analysis:
The judgment revolves around the question of whether wafers fall under the category of biscuits for the purpose of excise duty assessment. The petitioner, engaged in wafer manufacturing, contests the imposition of excise duty by the Collector, Central Excise, Hyderabad, arguing that wafers do not qualify as biscuits as per the definition under Section 2(d) of the Act. The petitioner seeks a declaration that wafers should not be subjected to excise duty.

The petitioner's counsel, Mr. V. Jagannadha Rao, emphasizes the importance of interpreting fiscal statutes strictly and in favor of the taxpayer. He argues that the processes involved in manufacturing biscuits and wafers are distinct, citing Encyclopaedia Britannica to highlight the differences. Section 2(d) of the Act defines excisable goods, while Section 3 outlines the levy of excise duties. The first respondent justifies the classification of wafers as biscuits based on market perception and dictionary definitions, asserting that wafers are commonly known as biscuits and are packed as such by well-known manufacturers.

The court examines various dictionary definitions of biscuits and wafers to determine their categorization. It is noted that while wafers may differ in size and shape, they are essentially a type of biscuit. The Encyclopaedia Britannica also classifies wafers as a variety of biscuits, further supporting the argument that wafers fall within the ambit of excisable goods. The respondent's position is upheld based on the ordinary meaning of the word "goods" and the understanding of wafers as biscuits in the market.

Ultimately, the court dismisses the writ petitions, ruling in favor of the first respondent and upholding the imposition of excise duty on wafers. The judgment highlights a tin of wafers manufactured by the petitioner, which describes the product as "Wafer Biscuits," reinforcing the conclusion that wafers are indeed considered a type of biscuit for excise duty purposes.