9911796707
TMI Blog2009 (9) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... ty to decide whether the carpets manufactured by M/s. Champdany Industries Limited have separate base fabric. The Commissioner found that the said question is technical in nature and in order to remove any doubt, matter was referred to an expert body like Jute Commissioner Office for its opinion. 4. Pursuant to the said remand order, the Department drew samples of the carpets manufactured by the respondent and sent the same to the Jute Commissioner's office. The Jute Commissioner got these samples tested by the expert body of the Jute Industry, namely, Indian Jute Industries Research Association and the report of the said association shows that jute predominates by weight over each other single textile material in the said carpets and the said carpets did not have any base fabric. 5. In the show-cause notice, which has been issued in this case, these facts are admitted. In the adjudication order passed in this case by Assistant Commissioner of Central Excise and Customs, Bhubaneswar, this fact has also been noted and from the said adjudication it will appear that the jute content in those carpets is 51.45% in B.L. and 52% in S.M. Those B.L. and S.M. are the varieties of carpets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction Notes any product which contains two or more textile materials are to be classified as consisting of that textile material which predominates by weight over similar textile materials. It may be noted that following the classification order dated 26.11.1999 the Assistant Commissioner passed a quantification order dated 30.03.2000, but since the appeal of the respondent-company in respect of the classification order of Assistant Commissioner dated 26.11.1999 was allowed, the appeal against the quantification order was also allowed by the Commissioner (Appeals) on 25.08.2000 by following order dated 13.03.2000 in the classification proceedings. 11. Against those orders dated 13.03.2000 and 25.08.2000 the Revenue filed two appeals before the Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as "the Tribunal"). Thereafter, the Tribunal by an order dated 26.09.2000 dismissed both the appeals filed by the Revenue. 12. It may be noted in this connection that before the Hon'ble Andhra Pradesh High Court petitions were filed in relation to classification at the stage of show-cause notice. The High Court of Andhra Pradesh interfered in those show-cause proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erwise than jute carpets by relying on the said Chapter note. 18. In our view the said stand of the Revenue is not correct. A perusal of the said Chapter note makes it clear that the same merely defines the term carpet and other floor coverings "for the purposes of this Chapter", namely, Chapter 57. 19. Here we must be conscious of the limited role played by Chapter Note. It is only to decide whether the goods in question are carpets and other textile floor coverings for the purposes of Chapter 57 or not. Once the goods are carpets and falling under Chapter 57, the role of Chapter Note 1 comes to an end. It is also the case of the Revenue that the Chapter Note 1 cannot be pressed into service for the purpose of classification. 20. Reference in this connection may be made to the relevant statutory provisions laid down in Section 2(A) and 14(A) of Section XI of the Central Excise Tariff Act, 1985. Those provisions are set out below:- "2(A) Articles classifiable in Chapters 50 to 55 or in Heading No. 58.06 or 59.02 and of a mixture of two or more textile materials are to be classified as if consisting wholly of that one textile material which predominates by weight over any oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (excluding dari, sataranji, namdahs, jute carpets and coir carpets) - In or in any relation to the manufacture of which any process is ordinarily carried on with the aid of machines: 5701.11 - Not embossed 30% 5701.12 - Embossed 30% 5701.90 - Other Nil 57.02 Carpets and other textile floor coverings (other than those of heading No.57.01) including floor coverings of felt, whether or not made up 5702.10 - Floor coverings of Coir Nil 5702.20 - Floor coverings of jute 10% 5702.90 - Other 30%" 26. The relevant entries from the Central Excise Tariff 1997-98 are extracted below: "57.02 Carpets and other textile floor coverings (other than those of heading No.57.01) knotted, woven, tufted or flocked, whether or not made up - In or in relation to the manufacture of which any process is ordinarily carried on with the aid of machines: 5702.11 - Of coconut fibres (coir) Nil 5702.12 - Of jute Nil 5702.19 - Other 25% 5702.90 - Other Nil" "57.03 Other Carpets and other textile floor coverings, whether or not made up 5703.10 - Of coconut fibres ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification to deny it the parentage and consign it to an orphanage of the residuary clause...." 33. That principle has also been upheld by another three-Judge Bench decision of this Court in M/s Bharat Forge and Press Industries (P) Ltd. Vs. Collector of Central Excise, Baroda, Gujarat - (1990) 1 SCC 532 (at page 534 para 4):- "4. The question before us is whether the department is right in claiming that the items in question are dutiable under tariff entry 68. This, as mentioned already, is the residuary entry and only such goods as cannot be brought under the various specific entries in the tariff should be attempted to be brought under the residuary entry. In other words, unless the department can establish that the goods in question can by no conceivable process of reasoning be brought under any of the tariff items, resort cannot be had to the residuary item...." 34. It is, thus, clear that the aforesaid principle has virtually been hardened into a rule of law by reason of the consistent view taken by this Court. The Revenue's stand in this case in purporting to justify the classification of the goods manufactured by the respondent company under a residuary heading, theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue argued that for the purpose of classification in this case Rule 3 of the `Rules for the Interpretation of the Schedule to the Act' should be applied and by applying the said Rule the goods manufactured by the respondent Company should be covered under the heading "others". 43. This Court is unable to accept the said submission for the following reasons. 44. In order to appreciate the said submission, the said Rule 3 (a) (b) and (c) is quoted below:- "3. (a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their esse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Customs, Mumbai Vs. Toyo Engineering India Limited - (2006) 7 SCC 592, para 16}. 51. Similar view was expressed by this Court in the case of Commissioner of Central Excise, Nagpur Vs. Ballarpur Industries Ltd. - (2007) 8 SCC 89. In paragraph 27 of the said report, learned Judges made it clear that if there is no invocation of the concerned rules in the show-cause notice, it would not be open to the Commissioner to invoke the said Rule. 52. Learned counsel for the Revenue also relied on some judgments. 53. It relied on the case of Oswal Agro Mills Ltd. and Ors. Vs. Collector of Central Excise and Ors. - 1993 Supp. (3) SCC 716. In that case the Court allowed the appeal filed by the assessee and did not accept the interpretation of the Revenue on `Toilet Soap'. Learned judges relied on the age old principle that where the words of the statute are plain and clear, there is no room for applying any of the canons of interpretation which are merely presumption in cases of ambiguity in the statute. 54. Applying the said principle in the present case, we hold that the ratio in Oswal Agro (supra) does not at all advance the case of the Revenue. Apart from that the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
