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TMI Blog1998 (7) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... Special Importance) Act, 1957. In the above entry, a condition has been put that the variety of textile should be as defined in the First Schedule to the Additional Duties of Excise (Goods of Special Importance) Act, 1957. Item No. 22 till March 15, 1995 was narrow woven fabrics (other than tulles, other net fabrics); there was no dispute with regard to exemption of the tax on the narrow woven fabrics manufactured and sold by the petitioners till March 15, 1995. Additional Duties of Excise (Goods of Special Importance) Act, 1957 was amended by Finance Act, 1995 and heading 58.06 was worded as under: Narrow woven fabrics (other than tulles, other net fabrics and goods of heading Nos. 58.07, 58.08, 58.09 and 58.10). 3.. The expression narrow woven fabrics in entry 58.06 was explained as under: For the purposes of heading No. 58.06, the expression narrow woven fabrics means: (a) Woven fabrics of a width not exceeding 30 cm., whether woven as such or cut from wider pieces, provided with selvedges (woven, gummed or otherwise made) on both edges; (b) Tubular woven fabrics of a flattened width not exceeding 30 cm.; and (c) Bias binding with folded edges, of a width wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the last 15 years there was no tax. Even the looms for the manufacture of these items have been classified under the Customs Tariff and Central Excise Tariff under heading 84.46. They are manufactured on looms known as shuttle or shuttleless looms and the commodities manufactured is known as narrow woven fabrics because the width does not exceed 30 cms. At the time when Additional Duties of Excise (Goods of Special Importance) Bill No. 101 of 1957 was moved in the Parliament it was with the following Statement of Objects and Reasons: The object of the Bill is to impose additional duties of excise in replacement of the sales taxes levied by the Union and the States on sugar, tobacco and millmade textiles and to distribute the net proceeds of these taxes, except the proceeds attributable to Union territories, to the States. The distribution of the proceeds of the additional duties broadly follows the pattern recommended by the Second Finance Commission. Provision has been made that the States which levy a tax on the sale or purchase of these commodities after the 1st April, 1958 do not participate in the distribution of the net proceeds. Provision is also being made in the Bill f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onary of Current English as under: Strip, n. Long narrow piece (a-of card, paper, cloth, garden, territory, board); narrow space in newspaper for small pictures telling a comic or special story (-cartoon); Odhams Dictionary of the English language has defined the word strip as under: Strip(1)-a long narrow piece or band; an edge or border; a shred. 9.. From the above definitions, it is evident that the commodity in dispute being a narrow piece in width comparatively long will be considered to be a strip. 10.. On the question whether it is a similar article of textile material much stress laid that it should be a manufactured item from textiles. The word article cannot be interpreted to be an item manufactured from textile. The word article has been defined in Odhams Dictionary of the English language, as under: Article (1)-an object distinct from others of a class, an item; a commodity or merchandise; a prose contribution on a subject published in a periodical; a tenet of belief; an item in a legal document or contract; part of a stem between two joints; a definite or indefinite demonstrative. In Encyclopaedia Britannica, at page 556, the word article i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufactured tobacco, cigars and cheroots, fabrics of silk, wool, cotton and man-made fibres, special woven fabrics, tufted textile fabrics, lace and embroidery, impregnated, coated, covered or laminated textile fabrics, knitted or crocheted fabrics. It is stated that the commodity is also governed by Textiles (Control) Order, 1986, wherein cloth has been defined to mean any fabric made either wholly or partly from cotton, wool, or man-made fiber (continuous) or man-made fibre (discontinuous), natural silk, or wastes of any of these materials and includes cloth containing any other yarn, but does not include.... (various items). It is stated that the exclusion clause of items mentions that the item is not excluded and therefore it is a cloth. Reliance is placed on the observations of the apex Court in the case of Porritts Spencer (Asia) Ltd. v. State of Haryana [1978] 42 STC 433 (SC); AIR 1979 SC 300, where the word textiles was interpreted as under (para 5) (pages 436-437 of STC): 5. There can, therefore, be no doubt that the word textiles in item 30 of Schedule B must be interpreted according to its popular sense, meaning that sense which people conversant with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The word textile was also interpreted in Delhi Cloth General Mills Co. Ltd. v. R.R. Gupta [1976] 38 STC 113 (SC) that it must acquire a body and texture. Presumably it is not just the skeleton of a textile. Apparently, it is more than that. It is also submitted that since there was a longstanding practice of 40 years, the change is not permissible in view of the judgment of the apex Court in Collector of Central Excise v. Indian Oxygen Limited [1989] 72 STC 118 (SC); [1990] 47 ELT 449. 12.. It is submitted that in a case where two views are possible, then the matter should be interpreted in favour of the subject as held in Collector of Central Excise v. Parle Exports (P) Ltd. [1989] 75 STC 105 (SC); [1988] 38 ELT 741 (SC) and Naffar Chandra Jute Mills Ltd. v. ACCE [1993] 66 ELT 574. The respondents are not justified in changing the settled law as has been held in Oriental Timber Industries [1985] 20 ELT 202 (SC), Mercantile Express Co. Ltd. case [1978] 2 ELT 552 (Cal) and Nafar Chandra Jute Mills case [1993] 66 ELT 574. The just claim of the citizens cannot be defeated or delayed by resorting to technicalities as observed in Madras Port Trust v. Hymanshu International 1979 EL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of section 29(2)(c) for the fraudulent evasion of tax, it is submitted that there is no fraudulent evasion of tax and an interpretation of the entry in a different manner, then the respondent would not bring the act of the petitioners as fraudulently evading tax. 15.. I have considered on this point. In Dadabhoy s New Chirimiri Ponri Hill Colliery Co. Private Ltd. v. Commissioner of Sales Tax, M.P. [1979] 44 STC 100 it is observed by the Madhya Pradesh High Court that a return will not be a false return if the facts are correctly disclosed. Raising of a false plea cannot make the return false. In Cement Marketing Co. of India Ltd. v. Assistant Commissioner of Sales Tax [1980] 45 STC 197 it is observed by the apex Court: ..............It is elementary that section 43 of the Madhya Pradesh General Sales Tax Act, 1958, providing for imposition of penalty is penal in character and unless the filing of an inaccurate return is accompanied by a guilty mind, the section cannot be invoked for imposing penalty. If the view canvassed on behalf of the revenue were accepted, the result would be that even if the assessee raises a bona fide contention that a particular item is not liabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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