TMI Blog1983 (11) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... aving been passed by High Courts of Bombay and Karnataka in or about September, 1975, the said company stood merged with J.L. Morison, Son Jones (India) Limited whereby the assets and liabilities of Smith and Nephew (India) Limited stood transferred to, and vested in, the latter company, and it is this second company as successor-in-interest, that filed the revision petition to Government of India and the same has been transferred to the Tribunal to be treated as if it were an appeal. It is registered as such, and taken up for disposal, after hearing notice to the party. 3. The subject-matter of the refund claims, were two products of the appellant-company described as : (i) Paragon Zinc Oxide Adhesive Plasters B.P.C., and (ii) Elastoplast Electric Adhesive Bandages B.P.C. Although it is not indicated on the record as to at what point of time, the manufacture of the products was undertaken, but the disputed period starts from the time when Tariff Item 60 was introduced in the Central Excise Tariff (hereinafter referred to as the C.E.T.), that is, with effect from 1971. It appears that the appellants themselves classified the subject goods as falling under newly introd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal hearing and that he had erred in rejecting the appeal on the ground that they had not come up in appeal against the classification, and that the order was not a speaking order, as no reasons on merits of the controversy had been recorded and that the observation of the Appellate Collector while dismissing the appeal that the classification having remained unchallenged, the party s refund claims were not entertainable, was wholly not sustainable inasmuch as Rule 11 fully entitled them to claim refund of amounts, paid as duty, which they considered to have been made by mistake or due to some error. They further contended that not only Rule 11 conferred on them the right to claim refund within a period of one year of duty paid in excess inadvertently, but it being a case of mistaken payments of duty which was not due, they were entitled to have a longer period of three years under general law of limitation and that the Appellate Collector erred in ignoring all these vital aspects. 8. On merits, they reiterated the contention that their products did not at all fall under T.I. 60 inasmuch as the said products were medicated plasters, manufactured to pharmacopeial or similar spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relates, he confirmed this fact. He clarified that the period in dispute was June 1971 to July 1974, as subject-matter of the two refund claims, and that the references which he was quoting, and copies of the relevant extracts thereof, which he was filing, were mostly from the editions of the year 1973. 11. He, first of all, supplied copy of the monograms from the Merck Index (8th edn.) and then from the B.P.C. 1973 to support his contention that these products known as zinc oxide adhesive plaster or bandages were made to specifications as laid down by these authorities and were subjected to highest degree of quality control, and were marketed with clear indication that they conformed to these standards, laid by the B.P.C. Reading from the relevant portions thereof, he stated that they consisted of a suitable cloth spread evenly as self-adhesive plaster mass containing zinc oxide, and laid emphasis on the fact that these were not covered by an ordinary adhesive substance, but highly medicated one, consisting of zinc oxide. He further read from B.P.C. 1973 to highlight the fact that zinc oxide itself contained medical properties, and relying on the same, contended that the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... connotation could not be held to be covering them and merely because the general description of a given tariff item tallies with the name or description of an article, it would not mean that said tariff item can apply to every commodity going by that name or description. (Reference is made in this connection to 1980 E.L.T. 468 (Mad.) : M/s Parry Confectionary Ltd., Madras v. Government of India and Others and 1979 E.L.T. J 608 : Shri Vallabh Glass Works Ltd. Vallabh Vidyanagar and Another v. Union of India and Others.) 15. Shri Engineer urged, therefore, that in the light of the test laid down by the Supreme Court, and further by Delhi High Court in case Alkali and Chemical Corporation of India Ltd. v. Union of India and Others (1981 E.L.T. 22) to the effect that excisable goods must be classified according to their general substantial use, and that in face of the fact as shown by reference to the BPC, B.P. (British Pharmacopeia) and Merck Index, etc. that zinc oxide has properties, protective as well as antisceptic, and is used in skin diseases, and is also for dressing in moist eczema and on wounds etc.; the plaster and bandage prepared with application thereof, made them to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thus Item 14E could apply though he wanted it to be placed on record that the view conveyed by means of the letter dated 6-1-1981 was also being contested by the appellants on the contention that the goods fell under T.I. 68. 18. The learned Counsel concluded by saying that the appellants would, in any case, be entitled to some refund even if the products were held to be falling under T.I. 14E, because of the duty difference in the rates between T.I. 60 and that of 14E. He further contended that although it was his stand that the payment having been made under mistake as to the applicability of the correct Tariff Item, and as such general law of limitation would apply giving appellants a period of three years, but in view of the Tribunal decision in case of Miles India Ltd. reported in 1983 E.L.T. 1026 (CEGAT) he realised that he could not urge this contention before us, and so far as the Tribunal was concerned, the consequential refund may be allowed for the period of one year, preceding the dates of filing of the respective claims, adding that at the relevant time, Rule 11 allowed one year for making such claims. 19. Smt. V. Zutshi, SDR addressing reply arguments on behalf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two tariff entries could apply to one product, she did not have much comments to offer except for saying that one could be at the intermediary stage and the other at the stage of final product. She also controverted the stand that if the products were held to be not classifiable under T.I. 60, then period of 3 years would be available for claiming refund. 20. Shri D.B. Engineer made a short rejoinder by pointing out that there was no question of any intermediary stage, and that he could vouchsafe for the fact that these were prepared in one continuing process, and that even the monograms indicated that it was not a case where first they were manufactured as mere adhesive tapes, and thereafter zinc oxide solution was being applied, and as far as his knowledge went, he could say at the bar that one single solution was applied containing adhesive properties as well as zinc oxide and other ingredients. He further pointed out that what was before the authorities were the goods as finished products, and that it would not be appropriate to introduce any element of intermediary stage now. 21. After applying our very careful thought to the matter, we find weight in the arguments adva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , inasmuch as reference has been made by the learned SDR herself to a number of Tariff Advices issued by the Board. Such clarifications would be necessitated only, if some doubts had been arising or felt in the matter of interpretation of T.I. 60. We also feel that this question, that such tapes of medicated plasters or bandages may be considered to be covered by this newly, proposed item was even visualised at that time but it was thought appropriate to set at rest such doubts in the Budget speech itself, and that we find it to be a very relevant factor, which should more or less clinch the issue. 24. We further find that the argument to bring in, the intermediary stage of the product, is also misconceived because apart from the fact that the entire controversy rests on the goods as produced at final stage, and as final products, at no time, question of intermediary stage was in focus. Otherwise also, a reference to the BPC 1973, to whose specifications these products are manufactured, makes it clear that these are prepared in one continuous process as the self-adhesive plaster itself is prepared in a mass form containing zinc oxide, and then spread on the cloth or fabric. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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