TMI Blog1991 (1) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... or) all sorts, whether rolled, forged, spun, cast, drawn, annealed, welded or extruded. After 1-8-1983, under Tariff Item 25(15) - Tubes and Pipes and Blanks therefor of iron or steel, rolled, forged, spun, cast, drawn, annealed, welded or extruded. After 1-3-1986 - under 73.03 as Tubes and Pipes and Blanks therefor, of iron or steel, rolled forged, spun, cast, drawn, annealed, welded or extruded (other than rain water pipes). That they are liable for exemption vide Notification No. 69/83-C.E., dated 1-3-1973, and prior to 1-8-1983, under Tariff Item 26AA(iv), that after 1-8-1983 being covered by T.I. 25(15) and sub-heading 7303.29 and exempted under Notification No. 208/83-C.E., dated 1-8-1983. 3. Pleading the case of the appellant, Shri M. Chandrashekharan, Ld. Advocate, stated that the decision of the Hon ble Supreme Court in the case of M/s. Bharat Forge Press Industries v. C.C.E., Baroda (Gujarat), reported in 1990 (45) E.L.T. 525 (S.C.) = 1990 (27) ECR 1 (SC), fully covered the issue, wherein it was decided that pipes/tubes, heading T.I. 26AA(iv) covers all types of pipes and pipe fittings. These cannot fall under the residuary Item 68. He, therefore, contended that till ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Press Industries v. C.C.E., Baroda (Gujarat), reported in 1990 (27) ECR 1 (S.C.) was with reference to the entry where the Supreme Court had held that the words all sorts was comprehensive enough to bring within their fold the pipe fittings. Tariff Item 25(15) as it existed after 1-8-1983, referred to tubes, pipes and with no mention of all sorts , would construe to mean pipes and tubes only and not the fittings. Hence, he differentiated the scope of the entries in the tariff to explain the application of the decision of the Supreme Court. For supporting this intention on the ratio to be made applicable, he referred to the case law referred in 1988 (33) E.L.T. 297 (Patna) - M/s. Tata Iron and Steel Co. Ltd. v. U.O.I. and Others : Precedent - Ratio decidendi - Binding only as such and not logical extensions therefrom - What binds is the ratio of a decision and not the logical extensions therefrom. Ratio decidendi is the rule deducible from the application of law to the facts and circumstances of the case and not some conclusions based upon facts, which may appear to be similar (1976 S.C. 1766 and 1986 BLJR relied upon). Therefore, he pleaded that the ratio of the Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (S.C.) - M/s. Jaishri Engineering Co. (P) Ltd. v. C.C.E. 5. We have considered the submissions made. The appellants have been charged with manufacture of Iron and Steel pipe fittings (Sockets) without obtaining Central Excise Licence. 4122 pieces of the Iron and Steel pipe fittings have been confiscated and permitted to be redeemed on payment of a fine of Rs. 10,000/-. Duty of Rs. 9,40,663.23 has been demanded for the Sockets , manufactured and cleared by them during 1985-86, 1987-88 upto 10-7-1987 and penalty of Rs. 50,000/- has been imposed. The finding of the Principal Collector for holding their products as not pipes and tubes is for the following reasons, his order is extracted below :- I observe that the Socket, the product manufactured by party is normally used for connecting two pipes. The product is sold loose in the market as well as attached with pipes and is distinctly known in trade as socket and not pipe/tubes as contended by the party. I feel that if a manufactured product can be separately identified then there is no reason why it should be considered as a part of the another item even if it is used with or without the other item. Now coming to the sub-headi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under Tariff entry No. 68. This, as mentioned already, is the residuary entry and only such goods as cannot be brought under the various specific entries in the tariff should be attempted to be brought under the residuary entry. In other words, unless the department can establish that the goods in question can by no conceivable process of reasoning be brought under any of the tariff items, resort cannot be had to the residuary item. We do not think this has been done. Looking at Tariff Item 26AA(iv), it encompasses all sorts of pipes and tubes. It is also clear that it is of no consequence whether the pipes and tubes are manufactured by rolling, forging, spinning, casting, drawing, annealing, welding or extruding. It is true that initially pipes and tubes may be obtained from sheets, billets or bars by various processes, but the process of manufacture of pipes and tubes does not end there. In order to achieve fully the purpose for which the pipes and tubes are manufactured, it is necessary to manufacture smaller pieces of pipes and tubes and also to manufacture them in such a shape that they may be able to conduct liquids and gases, passing them through and across angles, turning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ify sockets as pipe fitting. The appellants plea that Heading 7305 refers to couplings and the socket is different from coupling is not tenable, as the Heading 7305 in citing coupling etc., has only cited by way of example which is illustrative but not exhaustive. Hence, the Heading 7305 would cover the sockets manufactured from 1-3-1986 and demand for duty is correct for the period effective from that date. 6. As regards the aspect of limitation, the argument that there was no conscious or deliberate intent to evade payment of duty and it was a mere failure on their part is not sustainable. As being a manufacturer, it was his responsibility to have approached the department and obtained a confirmation that he was not expected to pay duty as per the prevailing practice with regard to the other manufacturers of the same products in the Field. Failure to take out a Central Excise Licence and to follow the law set out therefore would amount to evasion of duty, and the ratio enunciated in the judgment of the Supreme Court in C.C.E. v. Chemphar Drugs and Liniments, reported in 1989 (40) E.L.T. 276 (S.C.) will not come to their rescue. Therefore, the extended period beyond the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y resisted the proposed classification and pleaded various grounds including past practice, absence of malafides and the Department s knowledge of the facts. The appellants also filed certain details of other manufacturers showing that these products were cleared elsewhere without payment of duty. The appellants also stated before the Collector that the words couplings and sockets were not defined in the Tariff and filed trade opinion before him. They laid stress on Indian Standards (extracted in the Collector s order) and during the personal hearing these pleas were reiterated. In so far as the limitation is concerned I reproduce below the whole part of the observations made by the Collector : Regarding invoking of proviso to Section 11A(1) the party had been clearing excisable goods from their factory premises without the cover of Central Excise Gate Pass. They had neither disclosed the fact of manufacture of the goods nor complied with any of the Central Excise formalities. From the foregoing it is obvious that the party had deliberately withheld the information regarding manufacture and clearances of excisable goods from the Department. Thus in my opinion proviso to Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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