TMI Blog2000 (2) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... over a period of 50 years at Madras and they sell the product called "Puli Mark Seeakkai Thool" or in English "Tiger Brand Seeakkai Powder". People used to buy the said products only as "Seeakkai Thool" or otherwise called in English language as Soapnut Powder. 5.The petitioner had been selling the said product in small sachets of various sizes. The petitioner also had registered its mark under the Trade and Merchandise Marks Act, 1958 and their products is very popular among the lower strata of the society. The powder is being used for removing oil smears over the human body and for removal of grease from any surface. According to the petitioner taking oil bath is a speciality in South India and few people use this powder for cleaning utensils. The product has been in use for generations in rural areas by the rural poor. 6.According to the petitioner the ingredients of their product are (i) Mohwa de-oiled cake 95% (ii) usilai leaves 3% and (iii) Seeakkai 2%. The application of the powder is not confined to hair alone as in the case of a shampoo but for the entire body and it is a compound of several natural substances and there is no chemical process. For administrative con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... telligence Officer of the Directorate of Anti-Evasion, though request has been made for waiving the presence of the petitioner's wife, son as they are only sleeping partners. The petitioner herein requested the respondent to take xerox copy of the records seized from the premises to submit an explanation and requested to postpone the appearance. There has been no reply. On 23-1-1998, the officials of the Directorate General of Anti- Evasion, Central Excise took the petitioner to their office at Besant Nagar, Chennai and he was interrogated extensively for long hours and the petitioner was forced to give a statement as per dictation. Thereafter the petitioner was arrested and taken to jail. The reason for such remand being that the petitioner had failed to register himself under the Central Excises and Salt Act, 1944 and that if the petitioner applies for registration, the matter would be easy for him to come out of jail. 12.While the petitioner was in custody a communication dated 28-1-1999 was issued by the Superintendent of Central Excise D1 range D Division advising the petitioner to get itself registered with the Central Excise Department under Rule 174 of the Central Excise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dual items in that group is item 3307.90 which merely mentions 'others' and hence the powder sold by the petitioner which contains natural product like Mohwa de-oiled cake, Usilai leaves and Seeakkai would come under any of the products mentioned in the said chapter. So also the final products. The word others mentioned against item 3307.90 can be read and understood Ejusdem generis with the other items and can have relation to only such items. 17.The product item will not fall under any of the classification or entries and therefore it is clear that the Parliament had not chosen to impose excise duty on the product which is in use among rural poor. The product will not fall under any of the classification and definitely it will not fall under the caption in the entry namely 'others'. The same will not also come under residual item such as 3307.90, nor the respondents could force the petitioner to submit to their demands which cannot be sustained legally. 18.In respect of Mohwa Powder the claim of the respondent that the same will fall under item 3402.90 is not correct. The extracted registration by the respondent is of no avail. The said item namely, "Mohwa Powder" is not at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rch and seizure is without jurisdiction. The respondents have proceeded on a total misconception of the statutory provisions and had chosen to launch prosecution against the petitioner. The demand made by the respondent to register the petitioner to clear the goods after payment of excise duty and the compulsion to maintain books or accounts or registers is without jurisdiction and the action of the respondent interferes with the livelihood of the partners of the firm and hence the present writ petition. 23.Pending the writ petition, the petitioner took out very many applications and they are also being disposed of. As already stated, on behalf of the respondents a counter has been filed by the Deputy Director in the office of the Directorate General of Anti-Evasion. 24.In the counter affidavit filed on behalf of the respondents, sworn to by the Deputy Director, the Directorate General of Anti-Evasion, Chennai, it is stated that the petitioner is engaged in manufacture of excisable goods viz., "Puli Mark Seeakkai Powder" and M.M. Brand Arappu Thool. To clear of those products without registration under Central Excise Act and without payment of Central Excise Duty by the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... narrative form. A copy of the statement was also furnished to M.N. Venkatachalam along with the show cause notice. Any further documents, the petitioner was informed to come and take xerox copies as and when the petitioner require. 29.All the letters addressed by M.N. Venkatachalam had been replied by the Assistant Director under his signature. In terms of Rule 206(3) of the Central Excise Rules, 1994, materials seized by the excise Officer could be released to the owner on taking a bond in the prescribed form with such security as the Commissioner may require. The Commissioner by order dated 9-2-1998 ordered that the goods seized would be released provisionally on payment of cash security equal to the 25% of the value of the goods i.e., Rs. 50,000/- alongwith the necessary bond and the same has been communicated to M/s. Mayil Mark Nilayam on 12-2-1998 and the petitioner had not approached the concerned authority till date for release of the seized goods. Summons were issued under the Central Excise Act to all the concerned persons in connection with the enquiry in this case and there is no illegality in the said action. The respondents have complied with all the requirements a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rk Shikkakai Thool". Hence it is clear that the product is appropriately classifiable under Chapter Sub-heading 3307.09 of Schedule to Central Excise Tariff Act, 1985 as Bath Preparation. 34.The M.M. Brand Arapputhool (Mohwa powder) manufactured and marketed by the group as cleaning preparation for utensils etc., is also an excisable commodity having a distinct character in powder form. In M/s. Empire Industries Ltd. Others v. Union of India Others - 1985 (20) E.L.T. 179 (S.C.) the Apex Court held what is the meaning of the expression manufacture and it is not necessary that one should absolutely make out a new thing. In other words if by application of labour and skill an object is transformed to the extent that it is commercially known differently, it will suffice to say that manufacture has taken place for the purpose of Central Excise. 35.In M/s. Subharaj and Co. v. Collector of Central Excise - 1996 (88) E.L.T. 311 (S.C.) the Supreme Court observed that breaking and curshing of raw animal bones by a mechanical device called disintegrator amounts to manufacture. 36.In the present case there is a manufacture as has been laid down by the Apex Court in Shree Baidyanat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terial Mohwa Deoiled cake and final products viz., Arapputhool are entirely different. 39.The order passed by a Single Judge of the Karnataka High Court had been set aside in Appeal No. 1413/98 and 1736/98 on 3-2-99 and the Seeakkai Powder would come within the ambit of the items "others" grouped as 3305.90 and therefore it is liable to excise duty. 40It is the bounden duty of the every manufacturer of . excisable commodity to get himself registered under the Central Excise Act and clear the manufactured goods on payment of duty unless there is specific exemption. The petitioner is manufacturing excisable commodities without a registration and without payment of duty and without maintaining any statutory records cannot seek any indulgence from this court. It is further stated that everything has been done in conformity with the statutory provisions of the Central Excise Act, 1944 and the Rules framed thereunder. The action taken is within the provisions of the law and allegations that the respondents have acted without any justification and per se illegal are baseless and incorrect. The seizure also was affected in conformity with the statutory provisions. The provisions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been filed in respect of Mohwa Powder under entry 3402.90 and Seeakkai Thool under entry 3307.90. There is no dispute about the composition or Seeakkai Powder as well as Arappu Thool. 46.Chapter 33 of the Excise Tariff Act covers essential oils and resinoids, perfumery, cosmetic or toilet preparations. It is also seen that Chapter 33 does not cover natural oleoresins or vegetable extracts falling under heading No. 13.01, soapnut or other products falling under entry 34.01. According to the respondents, the product Puli Mark Seeakkai falls under heading 3307.39 as bath preparation and Arappu Thool falls under heading 3405.04. It was further contended that at any rate Mohwa Powder will fall under heading 3402.90 and Seeakkai Thool will fall under heading 3307.90. 47.Some of the Chapters which is relevant and which is being relied upon by Revenue, it would be proper to extract. Chapter 33, headings 33.03 to 33.07, reads thus :- 33.03 3303.09 Perfumes and toilet waters, not containing the substances specified in Note 1(C) to this Chapter 18% 33.04 3304.00 Beauty or make-up preparations and preparations for the care of the skin (ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t containing medicament or disinfectant. 8% 3401.12 Soap, in or in relation to the manufacture, of which, no process has been carried on with the aid of power or of steam for heating. NIL 3401.13 Laundry soaps produced by a factory owned by the Khadi and Village Industries Commission or any organisation approved by the said commission for the purpose of manufacture of such soaps. NIL 3401.20 Other 18% 3401.20 Organic surface-active products and preparations for use as soap in the form of bars, cakes, moulded pieces or shapes 18% 3401.30 Paper wadding felt and non-wovens, impregnated, coated or covered with soap or detergent. 18% 34.02 Organic surface-active agents (other than soap), surface-active preparations, washing preparations (including auxiliary washing preparations) and cleaning preparations, whether or not containing soap. 3402.10 Sulphonated caster oil, fish oil or sperm oil. NIL 3402.90 Other 18% 3405 Polishes and creams, for footwear, furniture, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uage of the statute it can be inferred that the general words were not intended to be so limited and no absurdity or unintended and unforeseen complication is likely to result if they are allowed to take their natural meaning. The Cardinal rule of interpretation is to allow the general words to take their natural wide meaning unless the language of the statute gives "a different indication or such meaning is likely to lead to absurd results in which case their meaning can be restricted by the application of this rule and they may be required to fall in line with the specific things designated by the preceding words, there can be no question of invoking this rule. Nor can this rule have any application where the general words precede specific words." 53. In Amar Chandra Chakraborty v. The Collector of Excise, Govt. of Tripura, Agartala and Others (AIR 1972 Supreme Court 1863). Their Lordships of the Supreme Court held thus :- "9. Before dealing with the contention relating to Article 19 we consider it proper to dispose of the argument founded on the ejusdem generis rule and Article 14 of the Constitution. It was contended by Shri Sen that the only way in which section 43 can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression has to be read ejusdem generis. 56. A Division Bench of this Court had occasion to consider the assessibility of Usilai Arappu Powder, Seeakkai Powder or Arapputhool under the Tamil Nadu Sales Tax Act and held that the two products will not fall under the entry "hair applicant." In that context, the Division Bench in W.A. Nos. 975 to 978 of 1994, dated 22-2-1995, held thus :- "It is also not possible to hold that the brand name in question falls under Serial No. 1 part F of First Schedule of the Act, as this entry is similar to the entry at Serial No. 51 of the First Schedule. Further the legislature has, by Act No. 55 of 1994, introduced an expression hair applicant in part I of Serial No. 51, First Schedule of the Act. This also indicates that the entry as it stood did not include sale of "hair applicant". However, we should not be taken to have expressed that the tiger brand soapnut powder falls within the expression hair applicant. In our view, it is sufficient to notice that the sale of tiger brand soapnut powder for the first time during the period 12-3-1993 to 1-4-1994 came to be subjected to sales tax under Serial No. 51, First Schedule of the Act pursuant t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded in chapter 33 or 34. Hence, it is clear that the two products namely Seeakkai and Arapputhool which are being used by poor villagers, as a substitute are not excisable products or commodity. It is clear that it is not the intention of the Legislature to bring in those products as one of the excisable commodities. Both the Chapters will not apply and therefore the two products are not excisable, though it cannot be ruled out that there was no manufacturing process at all. 62. There is manufacturing process by the mixture or two or more items and it may satisfy the definition of manufacture or processing. But the Seeakkai or Arapputhool or for that matter, even assuming that it is being applied for the purpose of taking oil bath to remove the oil from the body or being used as a scouring powder, the two products are not excisable. Once the two products are not excisable, the respondents have no jurisdiction to proceed. 63. It was contended by the learned counsel for the respondents that the petitioner has got the efficacious alternative remedy and without exhausting the same, the petitioner has rushed to this Court and this Court has to dismiss the writ petition as the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
