TMI Blog1994 (9) TMI 361X X X X Extracts X X X X X X X X Extracts X X X X ..... y in column (3) of the said table. The table appended to the said Notification reads as follows: TABLE S.No. (1) Description (2) Rate of Duty (3) 1. Commercial plywood Twenty per cent ad valorem. 2. Batten boards and block boards (including flush doors) having both faces of commercial plywood and veneered shocks and panels made up of strips of woods flued between two outer veneers. Twenty per cent ad valorem. 3. Insulation boards and hard boards. Ten per cent ad valorem. 4. Marine plywood and aircraft plywood. Ten per cent ad valorem. 5. Veneered particle boards excluding particle boards with decorative veneers on one or both faces. Twenty per cent ad valorem. 6. Unveneered particle boards. Nil 7. (Omitted as unnecessary)' The appellant's case was that the particle boards manufactured by it are 'unveneered particle boards' within the meaning of Item No. 6 of the aforesaid table and, therefore, totally exempt from duty. This case was accepted by the department. A few months later, the appellant started manufacturing what are described as melamine faced particle boards . The appellant claimed the benefit of the aforesaid Exemption Notifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen spread into a form of mat, forming two face layers and one Central core. The mat thus formed is conveyed to the Hydraulic press where it is subjected to heat and pressure. The boards remain in the press for a predetermined time after which they are taken out and cooled at room temperature. The surface of the board is then sanded in sanding machine, which also calibrates the board to the required thickness. The Tribunal has pointed out that the very same process is set out in the two affidavits of 'experts' filed by and relied upon by the appellant. The Tribunal then referred to the process of manufacture of MFPBs as described in brochure Exh.-II, According to the brochure, the appellant was carrying on a unique process where the resin impregnation takes place in an integrated process and this melamine facing is a part of this process, and not what could be a simple gluing of a material subsequently . The said process was described in the brochure as pre-lamination which implies that lamination takes place before fully manufactured particle board, in its marketable condition, conies into existence . The learned counsel for the appellant also placed before us pie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he melamine facing is done only on one side and not on both the sides.) It is thus difficult to say that the melamine faced particle boards can be described as 'unveneered particle boards'. Nobody in the trade circles or in the market would consider both the products as one and the same. From whichever way one looks at them, they appear to be different products. As stated hereinbefore, even the process of manufacturing is different. It is not a case of mere processing of particle boards for giving it strength. It is a case of manufacturing an altogether different product. Learned counsel for the appellant relied upon the following passage occurring under the heading Particle Boards' at page 175 of Encyclopedia Britannica (15th Edn.) Vol. 9: Particle board, construction material consisting of flakes, shavings, or splinters of wood glued together in the form of sheets. The particles are mixed with resin, water repellants, and mildew in-hibitors, formed into mats, hot-pressed, trimmed to the appropriate size and shape, and finally sanded. Particleboard was developed in the 1940s, when suitable synthetic resins became available; it has made possible the use of resid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able. The said affidavits, therefore, do not advance the appellant's case in any manner. The learned counsel for the appellant then contended that since there is an ambiguity about the meaning and purport of item-6 of the table appended to the Exemption Notification, the benefit of such ambiguity should go to the assessee manufacturer and the entry must be construed as taking in the MFPBs as well. It is not possible to agree with this submission. In Mangalore Chemicals Fertilizers Ltd.. v. Deputy Commissioner of Commercial Taxes Ors., [1992) Suppl. 1 S.C.C. 21, a Bench of this Court comprising M.N. Venkatachaliah, J. (as the learned Chief Justice then was) and S.C Agrawal, J. stated the relevant principle in the following words : Shri Narasimhamurty again relied on certain observations in CCE v. Parle Exports (P) Ltd, [1989] 1 SCC 345, in support of strict construction of a provision concerning exemptions. There is support of judicial opinion to the view that exemptions from taxation have a tendency to increase the burden on the other unexempted class of tax payers and should be construed against the subject in case of ambiguity. It is an equally well known princi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of Mr. Justice Molesworth upon the merits of the application to him is correct. They must begin by expressing their dissent from the principle which seems to have influenced Mr. Justice Moleswarth in this and some of the earlier cases, viz., that the provisions of the 24th section, because they establish an exception to the general rule, are to be construed strictly against those who invoke their benefit. That principle is opposed to the rule expressed by Loard Ellenborough's in Warrington v. Furbor, (8 East 242) and followed and confirmed in Hobson v. Neale, (17, Beav. 185). Lord Ellenborough's words are : - I think that when the subject is to be charged with a duty, the cases in which it is to attach ought to be fairly marked out, and we should give a liberal construction to words of exception confining the operation of the duty. It is only, however, in the event of there being a real difficulty in ascertaining the meaning of a particular enactment that the question of strict-ness or of liberality of construction need arise. To the same effect is the view expressed by Sir Raymond Evershed in Routledge v. McKay Ors., [1954] 1 A.E.R. 855. The learned Mas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he date of the order and furnishes bank guarantee for the balance. The order reads as follows : In the facts and circumstances of this particular case, we direct under Article 142 of the Constitution that the recovery of the demand which is to the tune of nearly a crore of rupees shall remain stayed on a condition that the appellant deposits 50% of the demand within three months from today and furnishes the bank guarantee for the balance within that time. Dr. Chitale, learned counsel for the appellant states that the appellant has already furnished bank guarantee for much larger amount. If that be so, the existing bank guarantee may be cancelled and a fresh bank guarantee to cover the remaining 50% of the demand shall be furnished. The bank guarantee shall, however, be kept renewed from time to time till the disposal of this appeal. The appellant will pay the interest @ 18% per annum on 50% of the demand in the event of the appeal being dismissed. If the appeal is allowed, the amount of 50% deposited by the appellant shall be refunded with the same rate of interest. The C.M.P. is disposed of accordingly. It is obvious that on the dismissal of this appeal, the aforesai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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