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TMI Blog1986 (7) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Tariff Item No. 34A by the Finance Act, 1979 the scope of that Tariff Item is restricted to the 15 commodities specified therein. That being so the screens manufactured by the petitioner merit classification in the residuary Tariff Item No. 68. In the result Appeal is allowed. - 3435 of 1984 and T.C. Nos. 349, 350 & 355 of 1983 - - - Dated:- 10-7-1986 - R.S. Pathak and Sabyasachi Mukharji, JJ. K.K. Venugopal and Soli J. Sorabji, Senior Advocates (Bishambar Lal H.K. Kochar, N.L. Beri, P.K. Chatterjee, Rajesh Agarwal and Arun K.r. Sinha, Advocates, with them), for the appellants. Gobind Das, Senior Advocate (Miss A. Subhashini, P.P. Singh, C.V. Subba Rao and Miss Sushma Relan Advocate, with him), for the respondents. [Judgment per : Pathak, J.]. - The question raised in the appeal filed by Atul Glass Industries (Pvt.) Ltd. (C.A. No. 3435 of 1984) under Section 35L(b) of the Central Excises and Salt Act, 1944 is whether glass mirrors fall under Tariff Item No. 23A(4) or Tariff Item No. 68 of the First Schedule to the Central Excises and Salt Act. 2. That is also the question raised in the Transferred Cases Nos. 349, 350 and 355 of 1983 filed by the Hindustan Saf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inding or bevelling and hole-drilling is done, if required, after the mirror has been manufactured. 4. Before the Budget of 1979, Tariff Item No. 23 relating to 'glass and glassware' prescribed the different rates of duty in respect of (1) sheet glass and plate glass, (2) laboratory glassware, (3) glass shells, glass globes and chimney for lamps and lantern, and (4) 'other glassware including table-ware'. During the period following the Budget of 1979 which is the period which concerns us, Tariff Item No. 23A relating to glass and glassware specified the rates of duty in respect of (1) flat glass, which included sheet glass, wired glass and rolled glass whether in the form of plate glass, figured glass or in any other form, (2) laboratory glassware, (3) glass shells, glass globes and chimney for lamps and lantern and (4) 'other glass and glassware including table-ware'. Tariff Item No. 68 is of residuary character and relates to "all other goods not elsewhere specified," but excluding alcohol, opium and certain other goods specified therein. The rate of duty is higher if the product falls under Tariff Item No. 23A(4) than if it fell under Tariff Item No. 68. The appellant submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re medium. This was, of course, subject to the condition that the glass sheets, out of which the glass mirrors were prepared, had paid appropriate duty under Tariff Item No. 23A before being employed in the manufacture of mirrors. The controversy was reopened later, and the Central Board of Excise and Customs reverted to its original understanding of the classification for the product. By Tariff Item No. 41 of 1981 dated May 7, 1981 it pointed out that glass mirrors had been classified under the Brussels Tariff Nomenclature as "glass and glassware" and taking the view that after undergoing silvering a glass mirror still remained glass it advised that glass mirrors should be treated as liable to excise duty under Tariff Item No. 23A(4) as 'other glass and glassware'. It has been noticed that the Superintendent of Central Excise called upon the appellant to take out a L-4 Licence on the footing that glass mirrors fell under Tariff Item No. 23A(4), that on appeal, the Collector (Appeals) reached the conclusion that it was not open to such classification but fell under the residuary Tariff Item No. 68, and that the Appellate Tribunal thereafter reversed the Collector (Appeals) and uphe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . A sheet of paper with a carbon coating thereon is employed for the purpose of producing copies of the original. The paper is a mere base while the function is performed by the carbon coating. This Court held in State of Uttar Pradesh v. M/s. Kores (India) Ltd. (1977) 1 S.C.R. 837 that carbon paper could not be described as paper. It referred to the functional difference between the two, and pointed out that while paper would be understood as meaning a substance which are used for writing or printing or drawing on or for packing or decorating or covering the walls, carbon paper, which is manufactured by coating the tissue paper with a thermosetting ink based mainly on wax, non drying oils, pigments and dyes could not be so described. 8. The test commonly applied to such cases is : How is the product identified by the class or section of people dealing with or using the product? That is a test which is attracted whenever the statute does not contain any definition. Porritts and Spencer (Asia) Ltd. v. State of Haryana (1978) 42 S.T.C. 433 = 1983 (13) E.L.T. 1607 (S.C.). It is generally by its functional character that a product is so identified. In Commissioner of Sales Tax, U.P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether thermometers, lactometers, syringes, eye-wash glasses and measuring glasses could be described as 'glassware' for the purpose of the Orissa Sales Tax Act, 1947 was answered by the Orissa High Court in State of Orissa v. Janta Medical Stores (1976) 37 STC 33 in the negative. To the same effect is the decision of this Court in Indo International Industries v. Commissioner of Sales Tax, Uttar Pradesh, (1981) 3 S.C.R. 294 = 1981 (6) E.L.T. 325 (S.C.), where hypodermic clinical syringes were regarded as falling more accurately under the entry relating to "hospital equipment and apparatus" rather than under the entry which related to "glasswares" in the U.P. Sales Tax Act. 9. Reliance was placed by the Revenue on Commissioner of Sales Tax, U.P. v. Banaras Bead Manufacturing Co. - (1970) 25 S.T.C. 100 where the Allahabad High Court held that glass beads could be described as 'glassware' for the purpose of a Notification issued under the U.P. Sales Tax Act. The decision of the High Court rested on the manner in which the contextual setting was altered in successive and different Notifications promulgated under the U.P. Sales Tax Act, indicating the content of the expression as deve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e view that glass mirrors cannot be classified as 'other glass and glassware' set forth in Tariff No. 23A(4), and must therefore fall under the residuary Tariff Item No. 68. 13. An additional point arises in M/s Hindustan Safety Glass Works Ltd. (Transfer Cases Nos. 349, 350 and 355 of 1983). The manufacturers of motor vehicles place orders with the appellant for the manufacture of screens for fitting in motor vehicles. They are commonly known as wind screens, rear screens and door screens. The screens are manufactured according to the specific shape and measurements indicated in the orders, for different vehicles require screens of different shapes and measurements. The screen is manufactured from sheet glass. It is first given shape and size according to the specifications contained in the order and thereafter subjected to the process of toughening. It is a fabricated article. 14. The Superintendent of Central Excise called upon the petitioner to pay excise duty on the basis that the screens fell under Tariff Item No. 23A(4) relating to 'glass and glassware'. The petitioner filed writ petitions in the Allahabad High Court challenging the view taken by the Excise authorities. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 C.E., dated March 1, 1979. By these Notifications parts and accessories of motor vehicles and tractors falling under Tariff Item No. 34A were exempted from the whole of the duty of excise leviable thereon provided the said parts or accessories were intended to be used in the manufacture of assembled components of motor vehicles and tractors and such assembled components were used as original equipment parts by the manufacturers of those vehicles and such parts and accessories which were intended to be used as original equipment parts by such manufacturers. On the enforcement of the Finance Act, 1979 the ambit of Tariff Item No. 34A became restricted to the 15 specified commodities. The commodities manufactured by the petitioner did not fall within the ambit of Tariff Item No. 34A. 16. It is the case of the petitioner that the commodities manufactured by it fall within the ambit of the residuary Item No. 68 of the First Schedule to the Central Excises and Salt Act. Prior to the enforcement of the Finance Act, 1979 the Central Government had, under Rule 8, issued Notification No. 166 C.E., dated April 19, 1979 whereby all excisable goods on which the duty of excise was payable an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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