1985 (12) TMI 162 - AT - Income Tax

Issues Involved:

1. Classification of "Intalox saddles," "Rasching rings," and "unglazed balls" under the Central Excise Tariff Schedule.
2. Determination of whether these goods fall under Item 23B(4) as "Chinaware and porcelainware, all sorts, not otherwise specified."
3. Consideration of the definitions and characteristics of porcelain and porcelainware.
4. Evaluation of the applicability of previous judgments and orders to the current case.

Issue-wise Detailed Analysis:

1. Classification of "Intalox saddles," "Rasching rings," and "unglazed balls" under the Central Excise Tariff Schedule:

The appeals relate to the classification under the Central Excise Tariff Schedule of "Intalox saddles," "Rasching rings," and "unglazed balls" manufactured by the respondents. The Assistant Collector of Central Excise, Nellore, classified these goods under Item 23B(4) as "Chinaware and porcelainware, all sorts, not otherwise specified." The Appellate Collector of Central Excise, Madras, however, held that the goods fell outside the scope of Item 23B and were non-dutiable.

2. Determination of whether these goods fall under Item 23B(4) as "Chinaware and porcelainware, all sorts, not otherwise specified":

Shri K.D. Tayal, representing the appellant Collector, argued that the goods were unglazed porcelainware and thus covered by Item 23B. He referenced definitions from ASTM and the Indian Standards Institution, indicating that porcelain includes both glazed and unglazed ceramic whiteware. He also cited judgments from the Madhya Pradesh High Court and the Madras High Court to support the classification under Item 23B(4).

3. Consideration of the definitions and characteristics of porcelain and porcelainware:

Shri P.S. Subramanian, representing the respondents, argued that the goods were a very inferior type of clayware and not ceramicware. He referred to the Chief Chemist's report, which described the goods as dull white with rough surfaces, indicating they were unglazed. He also argued that the goods lacked the essential qualities of porcelain, such as fine texture, translucency, and imperviousness to dye penetration. He cited a judgment from the Kerala High Court and an order-in-review from the Government of India to support his argument.

4. Evaluation of the applicability of previous judgments and orders to the current case:

The Tribunal considered various judgments and orders, including those from the Madhya Pradesh High Court, the Madras High Court, and the Supreme Court. The Tribunal noted that terms like "glassware" and "porcelainware" have specific connotations in commercial parlance. The Supreme Court's judgment in Indo International Industries v. Commissioner of Sales Tax, UP, emphasized that items should be interpreted based on their popular meaning rather than scientific definitions. The Tribunal concluded that the goods in question, being specialized articles used in chemical industries, could not be considered as porcelainware in the commercial sense.

Conclusion:

The Tribunal found considerable force in the respondents' argument that the goods could not be considered as porcelain. The goods were described as dull white with rough surfaces, not fitting the definition of porcelain. Moreover, the Tribunal held that the goods, even if made of porcelain, could not be considered as porcelainware in the commercial sense. Therefore, the Tribunal upheld the Appellate Collector's orders and rejected the four appeals of the Department.

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