TMI Blog1994 (6) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... trated upon the applicability of the clauses relating to predominance and percentages relying upon the decision of this Court in Multiple Fabrics. Before the Collector (Appeals) it relied upon Tariff Item 15A and submitted that since its coating material is not covered by Tariff Item 15A, Tariff Item 19 is also not attracted. For all the above reasons, we are not inclined to accede to the request for remand of the matters to the Tribunal for deciding the said question. The appeals are accordingly allowed. The orders of the CEGAT and Collector (Appeals) are set aside who said that the rexine cloth manufactured by the respondent cannot be called a 'cotton fabric' - 3094-95 of 1989 - - - Dated:- 27-6-1994 - Madan Mohan Punchhi, S.C. Agrawal and B.P. Jeevan Reddy, JJ. [Judgment per : B.P. Jeevan Reddy, J.]. - The respondent-company manufactures coated fabrics, popularly known as "rexine cloth" in the market. The question in issue in this appeal is whether the said product falls within T.I. 19(III) of the Schedule to the Central Excises and Salt Act, as it obtained at the relevant time. The Original Authority held that it does but the Collector (Appeals) held to the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esents a very minor portion of the final product. The contention of the Revenue, on the other hand, is that coated fabric (in the case of the respondent, rexine cloth) is expressly placed within the purview of the cotton fabric by the Parliament. In the face of such express inclusion, there is no room for arguing that the rexine cloth or coated fabric is not cotton fabric. May be that rexine cloth is not called or dealt with as a cotton fabric in the commercial world or in common parlance but that does not prevent the Parliament from treating it as a cotton fabric for the purposes of the Act and indeed the Parliament has chosen to include it within the ambit of cotton fabrics for the purposes of levying excise duty. Since the power of the Parliament to do so is unquestioned, the respondent's product is bound to be treated as 'cotton fabrics' within the purview of Tariff Item 19 and subjected to duty prescribed under sub-item (III) thereof. So far as the predominance or percentages referred to at the end of the first para of the Tariff Item is concerned, they are wholly irrelevant in the case of the respondent's product inasmuch as the said predominance or percentages are applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in motifs, in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power. The duty for the time being leviable on the base fabrics, if not already paid, plus 20% ad valorem 10% of basic duty chargeable. III. Cotton fabrics impregnated, coated or laminated with preparations of cellulose derivatives or of other artificial plastic materials The duty for the time being leviable on the base fabrics, if not already paid, plus 30% ad valorem -do- IV. Cotton fabrics covered partially or fully with textile flocks or with preparations containing textile flocks such as flocks printed fabrics and flock coated fabrics. The duty for the time being leviable on the base fabrics, if not already paid, plus 30% ad volrem -do- Explanation I: "Base fabrics" means fabrics falling under sub-item I of this item which are subjected to the process of embroidery or which are impregnated, coated or laminated with preparations or cellulose derivatives or of other plastic materials or which are covered partially or fully with textile flocks or with preparations containing textile flo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f cotton or the requirement of 40% cotton by weight etc., is to be applied to the cotton cloth simpliciter upon which coating is done or to the rexine cloth manufactured by the respondent. Precisely, with a view to obviate such doubt, has the Parliament added the proviso as well as Explanation (I) to the Tariff Item. The proviso provides in clear words that in the case inter alia of "fabrics impregnated, coated or laminated with preparations of cellulose derivatives or of other artificial plastic material .... such predominance or percentages, as the case may be, shall be in relation to the base fabrics which are ..... impregnated, coated or laminated....." Indisputably, when the proviso speaks of predominance or percentages, it is referring to clauses (i) and (ii) referred to above (which occur at the end of the first para of the Tariff Item). The proviso makes it clear beyond any doubt that the predominance and percentages referred to in the said clauses shall be in relation to the base fabric which are impregnated, coated or laminated, as the case may be. The proviso excludes any room for the argument that the predominance or percentages referred to in the aforesaid clauses (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , i.e., cotton fabrics excluding inter alia fabrics impregnated, coated or laminated with preparations of cellulose derivatives or of other artificial plastic materials. We are of the opinion that in view of the clear language of the proviso read with Explanation (I), there remains no room for the argument that the predominance and percentages referred to in clauses (i) and (ii) [occurring at the end of the first para of the Tariff Item] must be applied not in relation to the base fabric but in relation to the coated fabric or for that matter impregnated or laminated fabric. Clauses (i) and (ii) were found necessary for the reason that "cotton fabrics" mean not only fabrics manufactured wholly of cotton but also fabrics manufactured partly from cotton. The two clauses clarify what does the cotton fabric manufactured partly of cotton mean. 7. Shri Sorabjee cited several decisions of this Court holding that in interpreting the meaning of the words in a taxing statute like the Excise Act, the meaning assigned to the words by the trade and its popular meaning should be accepted and that the test to be applied is to see how the product is identified by the class or section of people w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cotton fabric within the meaning of Tariff Item 19. This argument does not take into account the fact that the Parliament has chosen to include the coated/laminated fabrics within the ambit and purview of "cotton fabrics" - and the Parliament's power to do so is not questioned and probably cannot be questioned. The fact remains that to start with it is a cotton cloth upon which certain coating material is applied. 10. We have already held that the predominance or the percentages referred to in clauses (i) and (ii) [occurring at the end of the first para of the Tariff Item] is applicable only in relation to the base fabric as clarified and defined in the Proviso and Explanation (I). It must follow therefrom that the question of predominance or percentages is irrelevant in the case of respondent's product inasmuch as the base fabric in the respondent's production is 100% cotton. The argument to the contrary is, however, based upon the decision of this Court in Multiple Fabrics. The said decision dealt with Tariff Item 22 and the product concerned was P.V.C. conveyor belting manufactured by the respondent therein. Tariff Item 22 deals with "man-made fabrics" and the Entry is substan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... product is not one of the impregnating, coating and laminating materials referred to in Tariff Item 19. In other words, his submission is that the coating material does not represent either "preparations of cellulose derivatives" or "other artificial plastic materials". He submitted that this submission was raised by the respondent both before the Collector (Appeals) as well as before the CEGAT but was not pronounced upon specifically in view of the fact that they held in favour of the respondent on other grounds. 14. We have seen the grounds of appeal preferred by the respondent before the Collector (Appeals). It does not contain any ground to the above effect. The order of the Collector (Appeals) refers to the argument of the respondent's counsel that "the Assistant Collector has wrongly referred the plasticizers and fillers as materials falling under the then Tariff Item 15A, i.e., plasticizers without any application of mind" and the further argument that "in fact plasticizers are chemicals and fillers and other goods which are not covered nor are assessed under Tariff Item 15A not being plastic materials". On the above basis, it was argued that the predominant material in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chnology - Vol. 14 - P. 170 (1987 Edn.): "Polyvinyle chloride (PVC) is a tough,, strong thermoplastic material which has an excellent combination of physical and electrical properties. The products are usually characterised as plasticised or rigid types. Polyvinyle chloride (and copolymers) is the second most commonly used in polyvinyle resin and one of the most versatile plastics." 16. The second category is plasticizers (13%), which is undoubtedly one of the basic materials of the plastics. (See Encyclopaedia Americana, Vol. 22 at P. 217). Even in the third category, there are plasticizers but we do not know to what extent. It thus appears ex facie that the coating material employed by the respondent is predominantly, if not wholly, "other artificial plastic materials". 17. The majority opinion, of course, does not refer to this aspect at all. 18. The reasons are shown and no material is placed before us to show that the said opinion of the Member of the Tribunal (Shri P.C. Jain) is not correct. The only submission has been that the matter be remitted to the Tribunal for a decision on this question. We are not inclined to do so, for if this were the case, the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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