Feedback   New User   Login      
Tax Management India. Com TMI - Tax Management India. Com
Acts / Rules Notifications Circulars Tariff/ ITC HSN Forms Case Laws Manuals Short Notes Articles SMS News Highlights
        Home        
Extracts
Home List
← Previous Next →

Zupiter Printery and Anr. Versus Union of India (UOI) etc.

1991 (3) TMI 394 - DELHI HIGH COURT

Civil Writ Nos. 1490, 1491, 1416 and 2160/82 - Dated:- 7-3-1991 - S.B. Wad And Usha Mehra, JJ. JUDGMENT Usha Mehra, J. 1. Writ petitioner felt aggrieved by the administrative directions issued by the Board to the Additional Collector, Customs, consequent to which, the said Adjudicating Authority classified its item i.e., the "outer shell" of the cigarette packet as box/container and covered the same under Tariff Item No. 17(4) of the Act. 2. Petitioner company manufactures cigarette &q .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

instructed the petitioner to classify the outer shell under Tariff Entry No. 17(4). He also instructed the petitioner to obtain a license and apply for re-classification. This direction of the respondent No. 4 was objected to by the petitioner on the ground that his item is not covered under sub-item (4) of Item 17 of the Tariff. After protracted correspondence petitioner agreed to apply for provisional clearance of his item i.e. the "outer shell" under Rule 9B of the Central Excise R .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ted 28th February, 1982. Provisional assessment already granted was also thus withdrawn. 3. Aggrieved by this action of the respondent present petition has been filed challenging the impugned order inter alia, on the ground that the Board has no authority under the law to give direction to a quasi-judicial authority like the Assistant Collector who was seized of the matter on the judicial side nor can outer shells of the cigarette packet which are open from both sides be classified as box or con .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lassification of printed cigarette packet shells. Sir, I am directed to say that certain doubts have been raised regarding the classification of the 'Outer shells' for cigarette packs under Tariff Item No. 17(4), Central Excise Tariff. It has been reported that the outer shells (generally meant for packing 10 cigarettes) are manufactured in a separate factory and the inner slides are generally manufactured in the factory where the cigarettes are manufactured. A question has been raised w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

No. 66/82-CE. The Board is also of the view that if the inner slides are manufactured and cleared along with the outer shells, duty would be chargeable on the value of the outer shell and the inner slide. However, if the shells are cleared from a factory on payment of duty under Tariff Item 17(4) and if the inner slides are inserted into these shells, along with the cigarettes in the cigarette factory, no further duty liability would be attracted under Tariff Item 17(4). 3. The receipt of this .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sistant Collector. In order to emphasise that it is on account of the directive issued by the Board that the impugned order has been passed, the counsel drew our attention to the impugned order dated 30th April, 1982 which is reproduced as under: OFFICE OF THE SUPERINTENDENT CENTRAL EXCISE RANGE IV VAPI Date: 30th April, 1982. To, M/s. Zupiter Printery, Vapi. Sir, Sub.: Classification Cigarette Shells. Regarding the classification of the Cigarette Shells, you are hereby informed that this printe .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

) and inner slides are inserted into these shells, along with the cigarette in the Cigarettes Factory, no further duty liability would be attracted under Tariff Item No. 17(4). In view of the above, clearances will be permitted only on payment of duty under 17(4). Provisional assessment granted earlier is hereby withdrawn. The differential duty for the past clearance will be paid forthwith. Yours faithfully, Sd/- Superintendent, Central Excise. Range IV Vapi. Contents of this letter to a great e .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he basis of which the impugned order has been passed was made behind the back of the petitioner. This way the petitioner has been deprived of reasonable opportunity to put forward his case or point of view. We cannot lose sight of the fact that because of these administrative instructions the adjudicating authority, i.e., the Assistant Collector in this case, who happens to be a subordinate to the Board, was bound to get prejudiced. 5. The natural presumption is that the adjudicating authority d .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e because the classification of that item was covered by the directions issued by the Central Board of Revenue. While considering the relevance of those directions issued by the Board, Supreme Court observed that powers of Assistant Collector, Collector or for that matter Central Government who hear appeals or revisions are quasi-judicial in nature. That power cannot be controlled by the administrative directions issued by the Board, that is the essence of our judicial system. Therefore, the ass .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that there is no provision empowering the Board to issue directions to assessing authorities or the appellate authorities in the matters of deciding disputes between the parties i.e., assessed and the department. Therefore such a quasi-judicial authority has to act independently and impartially. They cannot be said to act independently if their judgment is controlled by the directions given by others. The provision under which Board can give directions is found under Rule 233 of the Rules frame .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of uniformity. According to him these directions are not binding on the assessing authority. Such directions are issued keeping in view the interest of the assessed so that they may be treated equally by all the assessing authorities and to avoid different and contradicting decisions which can create confusion. Uniformity, in such matter, is the uppermost interest in the mind of the Board. This argument may at the outset look attractive but has no force in law. In reality, in administration the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e followed the directions issued by the Board as is apparent from the impugned order. Therefore, this action of the assessing authority definitely deprived the petitioner of his right of being heard, in violation of the principle of natural justice. Nobody can be condemned unheard. Therefore, the impugned order which is based on the direction of the Board, vitiates the order as well as the proceedings. 10. We could have set aside the impugned order on this short ground itself and remanded the ca .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of Item 17 of the Tariff from the duty of excise leviable. The said exemption is, however, not applicable to printed boxes and printed cartons. Tariff entry Item No. 17(4) reads as under: 12. Cigarette packet, according to the petitioner, consists of two component parts, one component part is described as "outer shell", the other a "slide" which is inserted in the shell to complete the packet. The said packet becomes complete only when slide is inserted into the "outer .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f cannot hold the cigarettes. It is to be seen at what stage excise duty is to be levied. In the case in hand, since the petitioner manufactures only outer shell which being open on both sides is incapable of holding any cigarettes and it is at this stage when it is mere shell, without any aid, it cannot be called box. The other important component is the slide, insertion of which makes it a container or box. But in the factory of petitioner slides are not manufactured. In the absence of slides, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed at the time of its manufacture for its natural placement. 14. We had the privilege to see this outer shell i.e., the product of the petitioner. It is open from both sides. Without the slide it cannot hold or contain cigarettes. It is only when slide is inserted that it becomes complete and can be called a box or container, but without slide it is neither. Broad description of the shell does not fit in the expression of box or container. 15. Definition of "container" came up for cons .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lying the above principle to the facts of the present case, if used in broad sense, the outer shell is neither a receptacle nor can contain an article by itself. This outer shell can also not be a container in a narrower sense because any articles placed in outer shell are not covered or enclosed nor they can be transported as such; nor the outer shell can be called an enclosure, which can be used for transportation of the cigarettes. The word "container" is admittedly preceded by the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

to a less general. Considering the expression 'containers' in the context in which it is used, the said expression has to be construed to mean 'packing containers' which are analogous to boxes and cartons, that is, an enclosed receptacle which can be used for storage and transportation of articles. The shell i.e., the product of the petitioner, is open from both the sides. In the absence of the slide this shell by itself will not be in a position to hold the cigarettes. It is on .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

es and styles of fiberboard containers. I.S.I. guidelines 6.4 described slide type boxes. Slide type boxes consist of several pieces of liners and sleeves sliding in different directions into each other. This group also includes outside sleeves in other cases. Referring to this ISI guidelines, Mr. Chandrasekharan contended that the outside sleeves as in the present case, the shell, will fall into the category of boxes. He drew our attention to diagrammatical representation made in this book to e .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Court pointed out the circumstances when ISI specifications can be relied upon. It was observed that when there is no trade evidence available then ISI specifications should be relied upon for interpreting a Tariff Entry. The trade meaning is one, which is prevalent in that particular trade where that good is known or traded. If special type of goods is subject matter of a fiscal entry then that trade entry must be understood in the context of that particular trade, bearing in mind that particul .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rade the shell is not known as a "box" which is a relevant consideration to be taken as observed by the Supreme Court in the above-mentioned judgment. By "box" we understand an encasement which ordinarily is used for the convenient transportation of its contents. Chambers English Dictionary defines "box" as "receptacle for holding anything usually four sided". Box is in fact more like a shelter which keeps other articles in itself. Therefore, in the Oxford .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ng in itself. Even if we do not give much importance to the dictionary meaning of the word "box" still the correct guide in such a case is the context and the trade meaning. The trade meaning is one which is prevalent, in that particular trade. Fiscal Entry must be understood in that context of that particular trade. In the cigarette trade, Mr. Ravinder Narain pointed out that when 20 packets of cigarettes are put in a bigger box or a container, such an outer container is known in comm .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Discussion Forum
what is new what is new
 


Share:            

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version