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TMI Blog1994 (2) TMI 266X X X X Extracts X X X X X X X X Extracts X X X X ..... les with tastemaker inside was approved by the Assistant Collector under sub-heading 1902.10 as a preparation put up in unit containers against the protest of the assessee for their claim under sub-heading 1902.90. The assessee s plea was that the packing in which the Noodles were offered for sale was not a unit container and was, therefore, not liable to Central Excise duty under sub-heading 1902.10. Against the order-in-original No. 70/CE/AC/87, dated 21-12-87 of the Assistant Collector, Central Excise Division, Patiala, the assessee filed appeal with Collector (Appeals), Chandigarh, who vide her Order-in-Appeal No. 1248/CE/ CHD/91, dated 30-7-91 set aside the orders of the Assistant Collector and accepted the appeal filed by the assessee holding that the Maggi was not put up in a unit container and was not liable to duty under sub-heading 1902.10. The said goods, she observed, attracted nil rate of duty under sub-heading 1902.90. The process is as under :- (i) Printed laminate in reel form is loaded onto a rod which is fitted to the wrapping machine and is thereafter passed through various rods and rollers to increase tension; (ii) The manufacturing date, price and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainers to means a container whether large or small (for example tin, can, box, jar, bottle, bag or carton, drum, barrel cannister) designed to hold a pre-determined quantity or number. The packing in which noodles are offered for sale satisfy this definition. The learned Senior Departmental Representative further argued that the pre-existence of container before goods are packed therein is not envisaged in this definition, nor can it be inferred therefrom. It only requires that container should be designed to hold a pre-determined quantity. Further the pouches or the sachets in which the noodles are packed will come in the meaning of the bag going by the Dictionary meaning of the term bag. It is not material for classification sub-heading 1902.10 that the pouches should come into existence first. The learned Senior Departmental Representative further referred to Technical Authority on Vertical and Horizontal pouch making in the McGraw-Hill Encyclopedia of Science and Technology, the learned Senior Departmental Representative pointed out to say what is involved in the process adopted by the Respondents is primary packing bringing together product and package. The selection of machin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or of Central Excise. The learned Counsel urged that the definition in Section IV is only for Unit container but not for container. The common understanding of container is a item which can hold something as has been laid down in the decisions relied upon by the respondents. The learned Counsel also submitted that the case law reported in 1989 (39) E.L.T. 376 (Mad.) relied upon by the Department is of no avail because it is now well settled by the Supreme Court decision reported in 1985 (19) E.L.T. 15 (S.C.) in the case of MSCO Pvt. Ltd. v. Union of India and Others that in construing a word in the Act meaning given to it in other Acts should not be resorted. 3. The submissions made by both the sides have been carefully considered. The question is whether the noodles manufactured by the respondents cleared packed in printed plastic film are classifiable under sub-heading 1902.10 and dutiable or under sub-heading 1902.90 CETA, 1985 attracting nil rate of duty. Section Note to Section IV of CETA under which Chapter 19 falls, defines Unit Container as follows :- In this Section the expression, unit container , means a container whether large or small (for example, tin, can, bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduced below :- The respondents have argued that the concentrate sold in the carboys was not put up in unit containers . The reasons given are briefly that - (a) they did not contain a predetermined quantity; (b) they were not labelled as required under the Fruit Products Order; and (c) the containers were not sold along with the goods but were durable and returnable. As against these arguments it has been argued on behalf of the Revenue that it is not necessary for the purposes of Item 1B that the container must be sold alongwith the goods. It has also been argued that the use of the expression unit container does not require that the containers should be full, or (what comes to the same thing) that the contents should be uniform. The expression unit containers has been used with reference to prepared or preserved foods ordinarily intended for sale. As seen from the notification issued under this item, it is intended to cover articles such as sausages, meat extracts and meat juices, prepared or preserved fish, soups and brothes, bottled or canned fruits and vegetables, sauces, jams, fruit syrups and juices, corn flakes, dehydrated peas and dehydrat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il. For obvious reasons the container has to be just large enough to hold the predetermined quantity of the contents. To pack half a litre of fruit syrup in a bottle which can hold one litre would not only be wasteful but would also subject the contents unnecessary movement, perhaps with a loss of quality. Further, it would arouse doubts in the customer that he is being cheated. It can therefore be very well understood that no intelligent manufacturer would pack prepared or preserved foods (or indeed any similar product of common consumer use) in a container which is .not full or practically so. Nor would a prudent customer readily buy a product in a container which does not appear to be full. The above observations on the methods of marketing of common consumer products, do not require any special knowledge because they are a matter of common experience. The tariff item and the Finance Ministry s instructions are consistent with the general experience and practice as mentioned above. General experience would certainly show that prepared and preserved foods and the like, as they are ordinarily sold in the market, are packed in containers which contain a specific and clearly marke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been no difficulty because it would have been a case where the preserved food is sold .......... But then the entry has qualified the said levy by using the words put up in unit containers and ordinarily intended for sale . It is, therefore, clear that if a prepared or preserved food is not put in unit containers and sold as such, the levy is not attracted. The levy is, therefore, dependent upon putting the prepared or preserved food in the unit containers and which is ordinarily intended for sale ............ Merely because the preservation requires that the powder should be placed in some or other form of containers, it cannot reasonably be said that it attracts the duty created by the said entry. The plain and reasonable meaning of the entry would be that those prepared and preserved foods which are put in unit containers and are meant for sale as such i.e. in such containers alone, are sought to be taxed and that is the clear ambit of the said entry read as a whole and giving full effect to all the words used therein as it ought to be. The rationale behind such tariff description is thus clearly set out in the decisions of the Andhra Pradesh High Court and the Tribunal. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we have to interpret the terms put up in unit containers and ordinarily intended for sale. The rationale behind such description in CET has, as pointed above, been gone into by the Tribunal in the Himachal Horticulture Corporation case supra and its ambit has been set out in the Andhra Pradesh High Court decision. The Tribunal decision in M/s. Ajay Electrical Industries Ltd. v. Collector of Central Excise case was regarding paper and paper board under Tariff Item 17 CET and the question was whether the open ended paper sleeves and drums manufactured by the appellants therein and which were folded at the ends to hold electric bulbs would fall under Item 17(4) CET which covered Boxes, cartons, bags, and other packing containers........ and flattened or folded cartons........ Para - 13 of M/s. Ajay Electrical Industries Ltd. decision reads as follows :- In the case before us, the Collector has held that paper corrugated drum is a carton after the bulb is put into it and the ends of the drum are folded so that the bulb does not slip out of it. Evidently, the situation is very much analogous to the case of aluminium foils and the cheese cubes. It was not a carton before the bulb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and horizontal...... . Both systems represent efficient means of providing economical flexible packaging........ Many variations on these basic systems exist for special applications......... In yet another variant, the product may be power-fed into a tube formed horizontally with the actual formation and closure of the material accomplished in the same manner as on vertical equipment but turned 90 . It may be recalled in this context that the Supreme Court in the case of Porrits Spencer (Asia) v. State of Haryana - 1983 (13) E.L.T. 1607 (S.C.) = AIR 1979 SC 300 had observed that in interpreting a term in a fiscal legislation it should be borne in mind that it is not a static concept and it should be interpreted having regard to newly developing materials, methods, techniques and processes. From the above, it will be evident that the primary packaging adopted by the respondents is one in which product and packages are brought together in-line on a form-fill-seal equipment. It is in such a package which is in the form of a sachet or pouch that the respondents sell the noodles in the market which contain pre-determined quantity. The word Sachet according to dictionary meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X
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