1987 (5) TMI 142 - AT - Customs

Summary

Issues:
1. Interpretation of the term "non-consumable stores" in Section 61(a) of the Customs Act, 1962.
2. Application of the definition of "stores" in the Customs Act to determine the warehousing period.
3. Impact of subsequent amendment on the interpretation of Section 61(a).

Analysis:
1. The case involved a claim for refund of interest paid on warehoused goods, specifically polyester manmade fibre yarn, by the respondent's mills. The impugned order allowed the refund based on the interpretation that the fibre, although consumed in the manufacturing process, became part of the end product, making it a "non-consumable" item eligible for a longer warehousing period under Section 61(a) of the Customs Act, 1962.

2. The Collector of Central Excise argued that the term "stores" in the Customs Act, as defined in Section 2(22), did not encompass all non-consumable goods. The appellant contended that the warehousing period for the goods in question should be limited to three months as they did not fall under the category of "non-consumable stores" as per the Act's definition.

3. The consultant for the respondents relied on the interpretation by the lower appellate authority and highlighted the subsequent amendment to Section 61(a) as clarifying the warehousing period for goods similar to those in the case. However, the Tribunal emphasized that the definition of "stores" in the Customs Act must govern the interpretation of "non-consumable stores" in Section 61(a) and that definitions from other Acts should not be imported for interpretation purposes.

4. The Tribunal, after considering both sides' arguments, agreed with the Collector's interpretation based on the defined term "stores" in the Customs Act. It cited a Bombay High Court case to support the principle that defined terms in an Act must be interpreted as per their definitions. Consequently, the Tribunal set aside the impugned order, ruling that the warehoused goods were only eligible for a three-month storage period, requiring payment of interest beyond that duration.