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TMI Blog2020 (2) TMI 1262X X X X Extracts X X X X X X X X Extracts X X X X ..... usdem generis or Noscitur a socciis - extended period of limitation. HELD THAT:- If Flour is placed along with Maida/Atta it cannot be taken to include Cocoa Powder for the reason that Cocoa Powder is a technically a Flour of beans. The issue is not so complicated and isolated that one requires to refer to Technical Literature to understand the terms. Technical Literature, being in its place, is no alternative to common sense and common man s understanding or for that matter Trade parlance. It s not the case of the importers that a common man on the street understands that Cocoa Powder and Atta/ Maida/Flour to be one and the same. No common man would go to a Flour mill to purchase Cocoa Powder . Therefore, no amount of painful elaboration based on too technical literature would replace common man s understanding particularly when the issue concerns very mundane thing like Atta/ Maida/Flour and certainly not Rocket Science. Whether the principles of ejusdem generis or Noscitur a socciis are applicable? - HELD THAT:- The word Flour has been used in conjunction with Atta/Maida and therefore, it would take the meaning of the words used along with it. One need ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc which necessitate invocation of extended period are present in the circumstances of the cases on the part of various importers. Therefore, though it was open to the department to revise the assessments, the same should have been done in the normal period. It is not free for the department to invoke extended period - the appeals made by Revenue survive, though survive on merits, demands being hit by limitation; appeals are liable to be rejected on the issue of limitation. Thus, the importers are not eligible to import Cocoa Powder against the items Flour/ Atta/Maida . However, Revenue appeals are liable to be rejected on the grounds of limitation - appeal dismissed - decided against Revenue. - Customs Appeal No. 87944, 87945, 87949, 87953, 87973, 87978, 87954, 87955, 87956, 87958, 87959, 87960, 87961, 87962, 87971, 87972, 87974, 87977, 87979, 87982, 87985, 87986, 87987, 87991,87992,87994,87997,88001,86657,86658,86741 of 2017 87192 of 2019 - A/85343-85373/2020 A/85374/2020 - Dated:- 26-2-2020 - Mr. S.K. Mohanty, Member (Judicial) and Mr. P. Anjani Kumar, Member (Technical) Shri K. M. Mondal, Special Counsel along with Shri R.K. Dwivedy, Authorized Representative f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ba Rao, General Manager and Shri Ramesh Kumar Agarwal, Director were recorded wherein they stated that the Licence did not allow their company to import Cocoa Powder; Cocoa Powder is not eligible at all for import under the Licence; Cocoa Powder is not capable of being used as substitute or alternate import in place of Atta/Maida/Flour which is the major ingredient for the manufacture of Biscuits Cookies. A show cause notice dated 13/8/2013 seeking reassessment of the bill of entry by denying the benefit of exemption notification No. 98/2009-Cus dated 11/9/2009 was issued and was adjudicated by the Commissioner vide his Order dated 27/3/2017 wherein it was ordered that the assessment bill of entry No. 8959157 dated 5/1/2013be finalised denying the benefit of exemption Notification No. 98/2009-Cus dated; confirming the duty of ₹ 25,47,301 with interest; confiscating the seized goods under 111(m) and allowing the same to be redeemed on payment of redemption fine of ₹ 10,00,000/- under section 125 of the said Act; imposing penalty of ₹ 25,00,000 on M/s. Ravi Foods, ₹ 20,00,000/- on Shri Ramesh Agarwal, ₹ 10,00,000on Shri Subba Rao and ₹ 10,00, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. M/s. Uni Colloids Impex 56/2016-17 /31/3/2017 11. C/STAY/93232/2017 IN APPEAL NO.C/87959/2017 -do- M/s Shree Simandhar Shipping Services. 56/2016-17 /31/3/2017 12. C/STAY/93233/2017 IN APPEAL NO.C/87960/2017 -do- M/s Dalal Association. Uni Colloids 56/2016-17 /31/3/2017 13 C/STAY/93234/2017 IN APPEAL NO.C/87961/2017 -do- Ms. PB Shipping Agency Pvt Ltd. M/s. Uni Colloids Impex 56/2016-17 /31/3/2017 14 C/STAY/93235/2017 IN APPEAL NO.C/87962/2017 -do- M/s. Twilight Litaka Pharma Ltd. M/s. Uni Colloids Impex Pvt Ltd. 56/2016-17 /31/3/2017 15. C/STAY/93237/2017 IN APPEAL NO.C/87971/2017 -do- M/s FSL Foods India Pvt Ltd. 51/2016-17/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 54/2016-17/ 31/03/2017 28 C/STAY/93257/2017 IN APPEAL NO.C/88001/2017 -do- M/s.Kwick Vargo Tracers and Lifters 54/2016-17/ 31/03/2017 29 C/CROSS/91136/2017 IN APPEAL NO.C/86657/2017 Ramesh Kumar Agarwal CC (EXPORT-I) Mumbai 52/2017/ 27/03/2017 30 C/CROSS/91135/2017 IN APPEAL NO.C/86658/2017 Mr. G U S R S Subbarao CC (EXPORT-I) Mumbai 52/2017/ 27/03/2017 31 C/EH/92628/2017 C/CROSS/91137/2017 IN APPEAL NO.C/86741/2017 M/s. Ravi Foods Pvt.Ltd CC (EXPORT-I) Mumbai 52/2017/ 27/03/2017 32 APPEAL NO.C/87192/2019 CC, Mumbai Export-I M/s. Ravi Foods Pvt Ltd CAO.No.15/201 8-19RCB/CC(X) dt.28.08.2018 3. Initially, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pter 11, while Cocoa Powder is covered by chapter 18 of the Central Excise Tariff Act, 1985. (ii). Regulations of the Food Safety Standards (Food Products Standards Food Additives) Regulations, 2011 and Guidance Notes of the Bread and Flour Regulations, 1998 define atta/Maida/Flour/Cocoa Powder separately. (iii). Dr. U.S. Annapure, Associate Professor of Food Chemistry, ICT, Matunga, in his opinion dated 21/10/2013, stated, inter alia, that Cocoa Powder cannot be used in place of Flour in making of Biscuits; in biscuits the main ingredient is Wheat Flour and Cocoa Powder can be used as a Flavouring Ingredient . (iv). the term Flour appears in the company of Maida and Atta. It means Atta, Maida and Flour are of the same class by application of the principles of ejusdem generis or noscitur a socciis . (v). for the 1st time the DGFT, vide Public Notice No. 93 (RE-2010)/2009-14 dated 1/2/2012, permitted duty free import of 09gms of Cocoa Powder as additives/ingredients against export of 1kg of Biscuits; prior to 1/12/2012, import of Cocoa Powder as an input item was not permissible against export of Biscuits under DFIAs. (vi). The contention of the importers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame as flour and hence, duty free import of the same is permissible against the transferred DFIAs; they also rely on Tribunal decision in the case of Kushalchand upheld by the Hon ble Apex Court ( supra). Per Contra, Learned Special Counsel for the Revenue submits that Cocoa Powder and Maida/Atta/flour are different commodities and distinctly known in the market as well as trade parlance; where as in the Licences issued Maida/Atta/Flour fall under Chapter 11of the Central Excise Tariff Act, 1985, while Cocoa Powder falls under chapter 18 ibid. 7 . We find, as submitted by Special Counsel, that though Maida, Atta, Flour and Cocoa Powder are not defined under Exim Policy and Customs Act, 1962, Regulations of the Food Safety Standards (Food Products Standards Food Additives) Regulations, 2011, define them as follows. Regulation No Definition 2.4.1 Atta or resultant Atta means the coarse product obtained by milling or grinding clean wheat free from rodent hair and excreta. 2.4.2 Maida means the fine product made by milling or grinding clean wheat free ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h it is used has no application to dhoop and aggarbatti. We further find that Hon ble Calcutta High Court, in the case of Atlantis (East Limited)(1975) 36 STC 210 Cal, held that in common parlance Flour is understood to mean only Wheat Flour; it did not include barley powder. 9 . We find that any article is to be read in the context of the Group it is placed in. If Flour is placed along with Maida/Atta it cannot be taken to include Cocoa Powder for the reason that Cocoa Powder is a technically a Flour of beans. The issue is not so complicated and isolated that one requires to refer to Technical Literature to understand the terms. Technical Literature, being in its place, is no alternative to common sense and common man s understanding or for that matter Trade parlance. It s not the case of the importers that a common man on the street understands that Cocoa Powder and Atta/ Maida/Flour to be one and the same. No common man would go to a Flour mill to purchase Cocoa Powder . Therefore, we find that no amount of painful elaboration based on too technical literature would replace common man s understanding particularly when the issue concerns very mundane thing like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... words, the meaning of the general words are taken to be restricted by implication with the meaning of the restricted words. This is a principle which arises from the linguistic implication by which words having literally a wide meaning (when taken in isolation) are treated as reduced in scope by the verbal context . It may be regarded as an instance of ellipsis, or reliance on implication. This principle is presumed to apply unless there is some contrary indication [see Glanville Williams, The Origins and Logical Implications of the Ejusdem Generis Rule, 7 Conv. (NS) 119]. 34. It is also one of the cardinal canons of construction that no statute can be interpreted in such a way as to render a part of it otiose. It is, therefore, clear where there is a different legislative intent, as in this case, the principle of ejusdem generis cannot be applied to make a part of the definition completely redundant. .. 29 . Nositur a Sociis means that when two words are capable of being analogously defined, then they take colour from each other. The term ejusdem generis is a facet of Nositur a Sociis. The aforesaid principle means that the general words following certain spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orters. 13 . We find that the importers vehemently relied upon the case of Kushalchand Co. However, learned Special Counsel submits that as observed by the Hon ble Supreme Court, the decision is relevant only inter se between the parties i.e. the Department and M/s. S. Kushalchand Co and It will not apply to others and even to M/s. Kushalchand in respect of the imports made elsewhere for the subsequent periods. A look at the relevant Paras of the judgement would be immensely beneficial. 5 . It is pertinent to mention that in spite of particular conclusion which was arrived at by the Tribunal that Cocoa Powder was Flour and covered under the description of the license, the Department did not choose to challenge this finding by filing any further appeal, therefore, at least inter se between the parties, the said issue attained finality and this finding was binding on the Commissioner and, therefore, it was not open to the Commissioner to re-visit the issue all over again and come to a contrary finding. 6 . The learned Attorney General made an endeavour to show that Cocoa Powder would not be covered by the term Flour . In view of the aforesaid facts emerging fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation under a particular type of licence, an error on the part of the appraising authorities on any previous occasion will not confer any right upon the importers to import such goods again on the basis of similar licences. It is also an accepted principle that if the customs authorities had been in error in not appreciating on any previous occasion that some goods not really covered by the licence were being imported on the basis of such licence they cannot be made to be embedded in the error for all transactions in the future. They have every right to correct their own error and if such correction requires adjudication it would not be just and proper for this court to refuse them an opportunity to do so................. 16 . We find that the benefit of Notifications No 40/2006-Cus dated 1/5/2006 and No 98/2009-Cus dated 11/9/2009is not automatic. It is subject to fulfilment of various conditions. Both notifications prescribe that the description, value and quantity of materials imported are covered by the said authorisation and the said authorisation is produced before the proper officers of customs at the time of clearance for debit . Therefore, we find that Customs Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the issue involved in this case is also same as other importers i.e. whether Cocoa Powder of ITCHS 18050000is same as Flour of ITCHS Code 11010000. On the merits of the case our findings as above are equally applicable to these set of appeals also. We hold, to cut short the repetition that cocoa powder cannot be equated Maida/Atta/Flour with and be allowed to be imported duty free against the DFIAs in question. In this case, we find revenue has provisionally assessed the bill of entry and on adjudication Commissioner has not only denied the exemption Notification but also confiscated the imported cocoa powder and allowed the same to be redeemed on payment of redemption fine in lieu of confiscation. He has also imposed penalties on the importer and their personnel. We find that though assessing the bill of entry provisionally is the prerogative of the department and the department is in its right to assess the bill of entry provisionally pending any enquiry or clarification, we find that seizure and confiscation are not warranted. We find that there were a number of importers who have imported Cocoa Powder in place of Flour/Atta/Maida ; proper officers have allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Cocoa Powder as additive/ingredient against export of 1kg of Biscuits. In view of our findings as above, we find that the respondents are not eligible for exemption to import Cocoa Powder against the items Flour/ Atta/Maida . 20 . In view of the foregoing, we uphold that on merits, the importers are not eligible to import Cocoa Powder against the items Flour/ Atta/Maida . However, we find that Revenue appeals are liable to be rejected on the grounds of limitation, in respect of other respondents herein, except M/s Ravi Foods Pvt Ltd. We pass the following order. (i).Appeal No C/86741/2017 filed by M/s. Ravi Foods Pvt Ltd is Partly allowed Confirming duty demand. However, fine penalty imposed are set aside with consequential Relief, if any, as per law. (ii). Appeals Nos C/86657/2017 (filed by Shri Ramesh Kumar Agarwal) and C/86658/2017 (filed by Mr. G.U.S.R. Subba Rao) are allowed. (iii). Appeal filed by Revenue C/87192/2019 is allowed by holding that the respondents are not eligible for the exemption claimed. (iv).Appeals filed by Revenue i.e. Nos C/87944/2017; C/87945/2017; C/87949/2017; C/87953/2017; C/87973/2017; C/87978/2017; C/87954/2017; C/87955/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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