TMI Blog1997 (12) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... ch were then repacked with polyethene cover and finally packed inside a wooden box before a despatch. The goods described as aluminium milk pot were also seized from the factory premises of M/s. Mauji Lal Metal Works. As it appeared that the so-called aluminium milk pots were aluminium containers which were sold only to M/s. Shiv Raj Tobacco Co. for the specific purpose of packing of pan masala and would hence fall for classification under Tariff Item 27(f) as aluminium containers, a show cause notice was issued to M/s. Shiv Raj Tobacco Co. proposing levy of duty of Rs. 11,396.58 on the seized goods and confiscation and imposition of penalty, to M/s. Shukla Rajaram concern for imposition of penalty and to M/s. Mauji Lal Metal Works for confiscation of seized goods, imposition of penalty and levy of duty on the seized goods as well as on aluminium metal containers valued at Rs. 60 lakhs approximately, manufactured and cleared by them during the period 1979-80 to 1983-84. M/s. Shiv Raj Tobacco replied to the show cause notice denying that they were producers of aluminium balties which were actually manufactured by M/s. Mauji Lal Metal Works and designed for carrying milk or liquid an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name of the product and the name of the manufacturer could not determine its classification as aluminium containers as rightly held by the Adjudicating authority. 4. The learned DR has not adduced any arguments to support the contention of the department that the goods in question were not aluminium utensils in the hands of the manufacturers namely M/s. Mauji Lal Metal Works. The Adjudicating authority has rightly concluded that the end use of these goods is not indicative of their classification and once it is accepted that the balties in question are aluminium utensils, the fact that they are used by the first respondent in this case to pack pan masalas will not alter their classification from aluminium utensils under Tariff Item 68 to aluminium containers under Tariff Item 27(f). 5. The Adjudicating authority has also accepted the contentions of the respondents that the aluminium balties were being supplied as a free gift to their bulk purchasers of Pan masala and there is nothing on record to dislodge this finding. 6. In the light of the above discussion, we see no reason to interfere with the finding that the aluminium balties in question fall for classification under Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant and significant where classification was related to the functions of the goods. In this case, there is no doubt about the fact that the goods had been specifically manufactured and also embossed with M/s. Shiv Raj Tobacco Co. Chaman Bahar Pan Masala and also put to specific use. These would determine the classification of the product as a container under Tariff Item 27. 12. It was also his contention that the so-called milk pots with the name of Pan Masala manufacturers and the trade name of pan masala embossed thereon are used for packing and sale of `Pan Masala . As such, these so-called milk pots satisfied the function of containers as given in Explanation 1 below Tariff Item 27 with a view to evading payment of duty and availing of exemption, the manufacturers had been selling them in guise of milk pots. 13. It is also a fact that during the last five years, the so-called milk pots or the balties under consideration had never been sold to any other utensils seller. 14. It was his submission that such milk pots merit classification as containers under Tariff Item 27 as these are not sold for use as domestic utensils. These were embossed, marketed and were solely p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , including collapsible tubes, casks, drums, cans, boxes, gas cylinders and pressure containers whether in assembled or unassembled condition, and containers known commercially as flattened or folded containers." We are required to decide whether the aluminium balties could be classifiable as such under Item 27(f) instead of Item 68 with benefit of exemption Notification No. 244/77 which covered utensils made of aluminium falling under Item 68 and the subsequent Notification No. 234/82 which also exempted utensils made of aluminium (vide Entry 38 in the Schedule appended thereto). 20. In this connection, I consider that since pan masala was a tobacco product, Section 2f(i) as it stood during the relevant period was also relevant. This provision reads as follows :- (i) in relation to tobacco includes the preparation of cigarettes, cigars, cheroots, biris, cigarette or pipe or hookah tobacco, chewing tobacco or snuff; (ia) in relation to manufactured tobacco, includes the labelling or re-labelling of containers and repacking from bulk packs to retail packs or the adoption of any other treatment to render the product marketable to the consumer;" 21. I consider that since in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with small packages and discrete objects, to consolidate shipments and allow transport on railway flat cars, flatbed trailers, aircraft, in ships holds or as deckloads, etc. (See Cargo Transporter : Containerization). (3) Any receptacle for holding a product. (Abstract from Glossary of Packaging Terms (USA)) Container. A large box for intermodal transport, containing many smaller boxes of different shapes and sizes as well as individual articles. (Abstract from Glossary of Packaging Terms (Australia))." 24. In the old Tariff Item 27, the emphasis in the Explanation is on the use of the word `container in the sense it is known commercially as containers ordinarily intended for packaging of goods for sale. 25. It is well known that aluminium balties are considered as vessels in common parlance and are not considered as containers ordinarily intended for packaging of goods for sale and are not normally used for packaging but for carrying and transportation of other material (of various types including water, milk etc.) and were used for carrying milk itself or referred to as a milk pot as well in a loose sense. 26. In the present case, admittedly, the pan masala was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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