TMI Blog1992 (4) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... while in T.A. No. 1919 of 1983, etc., dated April 25, 1985 and T.A. No. 589 of 1987 dated August 10, 1988, the Tribunal has taken the view that they (stainless steel wires) are not declared goods, against which all the present tax cases (revisions) are filed. 3.. The Revenue, on their part, while issuing clarificatory letters or circulars, had taken the following stands at different times. In the following instances, the Revenue has held that they are declared goods: D.D. 7226/83 Acts Cell II dated February 27, 1984, D. Dis. 31050/86 dated March 7, 1986, L. Dis. Acts Cell II /461160/87 dated March 31, 1987 and L. Dis. No. 107159/87 Acts Cell II dated July 13, 1987. On the other hand, in the following instances, the Revenue had taken the view that they are not declared goods: Acts Cell II/29763/89 dated March 27, 1991, K. Dis. Acts Cell II/16460/ 88 dated August 3, 1988 and L. Dis. Acts Cell II/77766/88 dated October 10, 1988. 4.. T.C. Nos. 630 to 632 of 1985, 96 to 98 of 1986 and 57 of 1991 are filed by the assessees, aggrieved by the view taken by the Tribunal that stainless steel wires and tubes are not declared goods, while T.C. Nos. 218 and 631 to 633 of 1989 are filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... producing necessary materials from various books, to support his case. His contention was that item No. 4 of the Second Schedule deals with various forms of iron and steel. The sub-items falling under main item No. 4 should be basically either iron or steel. The goods which are not iron or steel cannot fall under item No. 4 of the Second Schedule. Likewise, what is iron or steel cannot be denied coverage of item No. 4 of the Second Schedule. In other words, according to the learned counsel, the expression "iron and steel" will mean the intrinsic definition for the various sub-items. His further endeavour was that the expression "steel" would include alloy steel as well as non-alloy steel. If so, sub-items (xi) and (xv) would definitely cover both non-alloy steel as well as alloy steel, tubes, rods and wires. Therefore, according to the learned counsel, the proper construction of sub-items will depend upon the scope of the expression "iron and steel, that is to say," as occurring in item No. 4. In support of that, he invited our attention to Stroud's Judicial Dictionary, explaining the words "that is to say". He also invited our attention to Indian Standard (IS: 1956-1962) Glossary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can be stretched to stainless steel wires. Placing reliance on the words given in the sub-entry (xv), learned Government Advocate submits that those words will not include wire-rods made of alloy steel. For this, he derived support from sub-entry (ix) which reads as follows: "tool, alloy and special steels of any of the above categories." According to the learned Government Advocate, alloy and special steels, if at all, will apply to sub-items (i) to (viii) and not to sub-items (x) to (xvi). The sub-items under our consideration, namely, (xi) and (xv) will not have the benefit of sub-item (ix). He also submitted that strict interpretation must be applied in construing the words occurring in sub-items. Learned Government Advocate cited certain decisions which we will consider at the appropriate place. 11.. Mr. C. Natarajan, in reply, submitted that the scope and extent of one sub-item cannot be considered by referring to another sub-item. According to the learned counsel, the main entry must be looked into to understand the meaning to be given to any one of the sub-items. He alternatively contended that sub-items (i) to (viii) are in the nature of raw materials or primary steel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rifice or passing under pressure between suitably driven rolls. 9.125. Skelp- (a) Hot rolled strip with square or slightly bevelled edges, used for making welded tubes. (b) A strip or plate bent hot into a cylindrical shape with overlapping edges, before being welded to form a tube. 9.144. Tube (pipe)-A long, hollow, open-ended object of circular or other cross section. The terms 'tube and pipe' are often used synonymously. " Let us also refer to the Glossary of Terms relating to Iron and Steel (IS: 1956-1962-Amendment No. 1 May, 1965): "Red (wire-rod)-Wire-rod is of any shape, generally round and between 5 to 14 mm. in diameter, and is intended for conversion into wire. A rod that has been sized would be classified as wire provided it is between 5 to 12.5 mm in diameter. It will be classified as a cold rolled bar if it is above 12.5 mm in diameter. The term wire bar is the usual term which has later on come to be designated as wire-rod and hence wire bar and wire-rod are synonyms." We will now refer to Wire Encyclopaedia (from Wire Industry Year Book 1968): "Stainless steel: High chromium steel, often including nickel, which is resistant to corrosive and oxidis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inless steel Alloy steels containing, by weight, 1.2 per cent or less of carbon and 10.5 per cent or more of chromium, with or without other elements. (o) Wire Cold-formed products in coils, of any uniform solid cross-section along their whole length, which do not conform to the definition of flat-rolled products. (d) High speed steel Alloy steels containing, with or without other elements, at least two of the three elements molybdenum, tungsten and vanadium with a combined content by weight of 7 per cent or more of carbon and 3 to 6 per cent of chromium. Liquid steel obtained by the abovementioned processes, with or without further refining, is generally run into a receiving ladle. At this stage alloying elements or de-oxidising agents, in solid or liquid form, may be added. This may be done in a vacuum to ensure freedom from gaseous impurities. Steels obtained by all these processes are divided, according to their content of alloying elements, into 'non-alloy steels' and 'alloy steels' (stainless or other). They are further divided in accordance with their special properties into free-cutting steel, silicon-electrical steel, high speed steel or silico-manganese stee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ---------------------------------------------------------------- 72.23 7223.00 Wire of stainless steel Rs. 2,500 per tonne ---------------------------------------------------------------------------- 15.. The Supreme Court, while considering section 14(iv) of the Central Sales Tax Act, before amendment, dealing with iron and steel, in State of Tamil Nadu v. Pyare Lal Malhotra reported in [1976] 37 STC 319, observed as follows: "What we have inferred above also appears to us to be the significance and effect of the use of words 'that is to say' in accordance with their normal connotation and effect. Thus, in Stroud's Judicial Dictionary, 4th Edn., Vol. 5, at page 2753, we find: "That is to say.-(1) 'That is to say' is the commencement of an ancillary clause which explains the meaning of the principal clause. It has the following properties: (1) it must not be contrary to the principal clause; (2) it must neither increase nor diminish it; (3) but where the principal clause is general in terms it may restrict it. See this explained with many examples, Stukeley v. Butler Hob. 171." 16.. From the various extracts taken from several books, there cannot be any doubt that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as raw material out of which other goods are made and others are definitely varieties of manufactured goods." We find force in the argument of the learned counsel for the assessees that a sub-item cannot be construed with the aid of another sub-item, to restrict the scope of one sub-item. In other words, the learned Government Advocate, by referring to sub-item (ix), wants to restrict the scope of sub-items (xi) and (xv). That may not be a proper way of understanding the sub-items, as rightly contended by the learned counsel for the assessees, Mr. C. Natarajan. For understanding the sub-items, we must look into the main item, and if so done, there is no difficulty in holding that stainless steel tube and stainless steel wires are declared goods. 18.. The learned Government Advocate placed reliance on the decisions in Agral Metal Perforators v. Commissioner, Sales Tax reported in [1981] 48 STC 378 (All.), Appolo Tubes Limited v. State of Kerala reported in [1986] 61 STC 275 (Ker), T.I. and M. Sales Limited v. State of Tamil Nadu reported in [1983] 52 STC 99 (Mad.) [App.] and Rajasthan Iron and Steel Merchants Association (Pvt.) Ltd. v. Commercial Taxes Officer reported in [198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereinbefore and there being no other reliable evidence as to how coated paper is understood in the market, except the opinion of the Indian Standards Institute in its specifications, in our opinion, the Tribunal was not right in the view it took. * * * There was authority of the Indian Standards Institute's publication 'Glossary of Terms used in Paper Trade and Industry'--IS: 4661. In view of the facts as appeared in paragraph 14 of the Tribunal's judgment in Kores (India) Ltd. v. Collector of Central Excise [1987] 29 ELT 627 where the basis of the classifications of ISI in its specifications is explained, we are of the opinion that the carbon paper fell under item 17(2) as it stood at the relevant period germane for this appeal, before 1982, and not in residuary item No. 68 of the Central Excise Tariff." 21.. It is also submitted that wires and tubes are marketed in lengths and, therefore, they cannot be treated as articles of stainless steel. In support of that, Mr. C. Natarajan placed reliance on the judgment in Commissioner of Income-tax v. Krishna Copper and Steel Rolling Mills reported in [1992] 193 ITR 281 (SC); (1991) 4 JT 350 (SC). The question that was considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocesses used in the manufacture or production of articles of iron and steel and also mean, particularly when used in the plural, the articles produced by the process (vide: Glossary of terms published by the Bureau of Indian Standards and relating to Iron and Steel: Part VI 'forging'). Item No. 21 which refers to 'seamless tubes' also furnishes a similar indication. There is, therefore, a distinction between the article or thing referred to in the Schedules as 'iron and steel (metal)' and articles or things manufactured from 'iron and steel'. * * * (iii) the production from blooms, billets and slabs-again by processes of hot-rolling, cold-rolling, forging, extruding, drawing, etc.-of finished steel products, bars, plates, structural shapes, rails, wire, tubular products, coated and uncoated sheet steel, etc., all in the many forms required by users of steel." * * * We would like to emphasise, at the cost of repetition, that what we should examine is not the nature of the mill which yields the article but the nature of the article or thing that is manufactured and ask ourselves the question whether such article or thing can be considered as raw material for manufacture of ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onclusion partially to uphold the validity of the said laws it is difficult to deduce any general principle which on the principle of stare decisis can be taken as binding for future cases. It is trite to say that a decision is binding not because of its conclusion but in regard to its ratio and the principle laid down therein." 25.. In Nathmal Manghilal and Company v. State of Andhra Pradesh reported in [1983] 54 STC 91, a Division Bench of the Andhra Pradesh High Court, on an identical question, namely, the binding nature of a decision rendered at the admission stage, held as follows: "This order was made at the stage of admission. Since this order affirms the approach of the Tribunal, we have sent for the relevant record and have perused the Tribunal's order. Unfortunately, the definition of 'cotton fabrics', as set out in item 19 of the First Schedule to the Central Excises and Salt Act, 1944, which has to be imported into the Andhra Pradesh General Sales Tax Act, by virtue of the explanation to the Fourth Schedule to the A.P. General Sales Tax Act, was not brought to the notice of the learned Judge. In view of the fact that entry 19 of the First Schedule to the Central Exc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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