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TMI Blog1996 (9) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the aforesaid action, the petitioner earlier filed M.P. No. 4325 of 1991 and a Division Bench of this Court by order dated February 18, 1994 disposed of the writ petition with the following direction: "(1) The second respondent shall after giving an opportunity of hearing to the petitioners, record a decision as to whether refractory is a form of cement subject to export tax or a product of cement subject to export tax or not, and communicate the decision to the petitioners; (2) Till such decision is arrived at, the petitioner shall not be compelled to pay export tax on refractory exported up to October 30, 1993 subject to the condition that the petitioners filed affidavit before the second respondent within two weeks from today agreeing to pay arrears of tax in case the decision as aforesaid goes against them; and (3) The second respondent shall record the decision within 30 days from today." Thereafter, as directed by this Court the Administrator vide its order dated March 30, 1994 held that the petitioner manufactured high alumina binder (refractory) which, in fact is high alumina cement and as such liable for export tax, in view of the aforesaid resolution of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ufacture of cement. It is their stand that for manufacture of cement the main raw material is limestone, silicious clay and gypsum; bauxite and fire clay are not used for the manufacture of cement. However, for manufacture of refractories the major raw material is bauxite, kyanite and fire clays. 8. According to the petitioner, the chemical composition of cement is entirely different from that of refractories. The criteria of test for a normal cement, according to the petitioner, is different from those for refractories. It is the stand of the petitioner that for constructional cement the most important criteria is its strength at ordinary temperature, whereas for the refractory materials the criteria is its refractoriness at high temperature, technically called P.C.E. value and the temperature at which the material gets its strength. According to the petitioner the skills required in the cement plant and those required in refractory plant is also entirely different. The petitioner has given the comparative table of the raw materials, process of manufacture, etc., to demonstrate that the refractory is not a type of cement. It is as follows: COMPARATIVE TABLE C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any type of cement and as such not liable to pay the export tax. 10. Return has been filed on behalf of respondent No. 2, i.e., the municipal corporation and their stand in the return is that the refractory material high alumina refractory binder manufactured by the petitioner comes within the definition of cement. It is their stand that the term "refractory binder" is another nomenclature for cement and the basic character of both are the same, i.e., both are binding agents. It is contended that the application of the two products may be different, but the same would not exclude refractory in question from the category of all types of cement. It is contended that the cement is used for the purposes of carrying out ordinary construction work. Refractory has its uses in special fields and this difference in application is basically due to the character of the two. However, according to the answering respondent the basic feature of both remains the same. It is the stand of the respondents that the products manufactured by the petitioner are classified in two heads that is shaped items and unshaped items and export tax is being levied only on unshaped items. It is their stand that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same cannot be termed as cement. It is emphasised that the comparison of the raw material used for manufacturing of refractory and cement being different, refractory cannot be said to be a type of cement. 15.. It is relevant here to state that the expression cement has not been defined. It is well-settled that while giving the meaning of a particular commodity the dictionary meaning and the technical meaning should not be adhered to and that in a taxing statute words of every day use must be construed not in their scientific or technical sense, but as understood in commercial parlance. However in the present case the product high alumina binder is not a product of every day use and it is used in specified field. Thus reference is required to be made to dictionaries and scientific book to understand the same. 16.. Various dictionaries have defined the expression cement in the following terms: Chamber English Dictionary-1989 Indian Edition: "Anything that makes two bodies stick together, mortar;" Websters New International Dictionary "A substance used in a soft or pasty state to join stones or bricks in a building, to cover floors, etc., which afterwards becomes h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws: "Cement: The word cement is used to define adhesive substances. It is derived from the Latin caementum, which meant stone chippings such as were used in Roman mortar, not the binding material itself. In its general sense it covers a wide variety of binding materials used for many different purposes, but more commonly it implies the binding materials used in building and civil engineering construction. These constructional cements which will set and harden under water, are often called hydraulic cements. The most important of these is portland cement. Others are the slag containing cements and high alumina cement. This article covers constructional cements. Adhesive cements are covered under adhesives. Cements are finely ground powders that when mixed with water, set to a hard mass, setting and hardening result from the hydration of the cement compounds, giving submicroscopic crystals or a gel like material with a high surface area. Cements may be used alone (i.e., neat as grouting materials), but the normal use is in mortar and concrete in which the cement is mixed with inert material known as aggregate. Mortar is cement mixed with sand or crushed stone less than 3/16 inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty refractory purposes. Refractories according to Encyclopaedia Britannica means: "Materials not deformed or damaged by high temperatures, used to make crucibles, incinerators, insulation and furnaces, particularly metallurgical furnaces. Refractories are produced in several forms molded bricks of various shapes (see also fire brick); bulk granular materials; plastic mixtures consisting of moistened aggregate that are rammed into place; castables composed of dry aggregates and a binder that can be mixed with water and poured like concrete; and mortars and cements for laying brick work. Refractories may be chemically acid, basic, or neutral, depending on the application. Silica (made from sand or quartzite), zircon (for extreme heat resistance), and fire clay (made by baking kaolin) are acid; magnesite and dolomite are alkaline; high aluminal refractories, mullite, chromite, silicon carbide, and carbon are neutral. Carbon is an excellent refractory in places where no oxygen can contact it, as in the hearth of a blast furnace. A smelting furnace lining must Here italicised. be acid if the slag is acid and basic if the slag is basic, so that it will not react and be eroded." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cement. In the background of the aforesaid fact the learned Judges held that cumicrete is not cement. However, in the present case the petitioner is manufacturing, what he terms to be high alumina binder, which the answering respondents names as high alumina cement and held as such. In that view of the matter the authority relied on by the learned counsel for the petitioner is clearly distinguishable. It is relevant here to state that the answering respondent in the return has specifically taken a stand that the petitioner-company is producing shaped and unshaped items and export tax is being leviable on unshaped items only and the high alumina refractory binder comes under the unshaped items. Even at the cost of repetition I may state that there are refractories which are not cement for instance cumicrete considered in the Madras judgment, but high alumina although a refractory material, is a type of cement. Every refractory may not be cement, but product like high alumina is a type of cement. 23.. Allahabad High Court in the case of Commissioner of Sales Tax v. Mango Mal Nanak Ram [1974] 33 STC 556, had the occasion to consider this aspect of the matter. In the said case quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... then contends that the Industrial Tribunal in its award dated March 30, 1994 having held that the wage structure of cement industry shall not be applicable to the workers of the petitioner industry, clearly shows that the product sought to be taxed is not liable to be taxed is not cement. The aforesaid lis pertains to the wages of the workers and cannot have bearing on the question as to whether the refractory in question is cement or not. Further petitioner is manufacturing various other refractories which may or may not come under the expression cement. Thus, the reliance of the learned counsel for the petitioner on the aforesaid award is clearly misplaced. 27.. There is yet another reason to decline the relief sought for by petitioner. The petitioner is paying Central excise duty on the product high alumina refractory binder under item salt, sulphur, clay and stone, plastering material: Lime and Cement as contained in chapter 25 of the Excise Manual. This may not be decisive but the said fact has not been disputed and the petitioner has accepted the liability to pay the Central excise under the aforesaid head, I am of the view, that in the facts of the present case, the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame cannot come within the expression all types of cement under the resolution of the municipal corporation. In this connection my attention has been drawn to the order of the Assistant Collector dated November 19, 1992 in which he has held as follows: "In view of above discussion and findings I hereby approve water proofing compound for classification under chapter sub-heading 2915.90 of the Central Excise Tariff Act, 1985 (5 of 1986) and batch mixture of clay broken stone-ware pipes and sand mentioned at Sr. No. 4 of classification list No. 19/91-92 with effect from August 19, 1991 under chapter heading 2505 of the Central Excise Tariff Act, 1985 (5 of 1986)." 32.. Shri Agrawal, however, appearing on behalf of the answering respondent submits that the finding recorded by the Assistant Collector is not binding on the answering respondent and he further submits that the finding arrived at by the Assistant Collector is also not sustainable on principle. He submits that the petitioner-company itself advertises its product Accoproof and explains the use of its product on packing plastic cover as under: "Waterproofing compound: Accoproof, the cement waterproofing compound contain ..... X X X X Extracts X X X X X X X X Extracts X X X X
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