TMI Blog1993 (5) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacturing of electric cables is synthetic rubber or synthetic resin for its proper classification under the appropriate heading of Customs Tariff Act, 1975 for the purpose of assessment to customs duty. The relevant facts as noted by the Trial Court are as under : 1.The writ petitioner, the respondent herein having its factory at Shyamnagar, 24-Parganas, West Bengal, is carrying on the business of manufacturing various types of electrical cables and wires. In course of its said business, the respondent is required to import various items including synthetic rubber sold under the trade name of Hypalon-40 which is used for insulating wires and cables. The said Hypalon-40 is manufactured by only one concern in the world, namely, DU POIN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... polymer and that it did not conform to the definition of synthetic rubber as given in Note 4 of the Notes under Chapter 40 of the 1st Schedule to the Customs Tariff Act, 1975. Reference was also made to Tariff Advice No. 17 of 1974 where Hypalon has been suggested to be treated as plastic material in certain exemption notifications issued by the Customs authorities; Hypalon and been described as goods falling under Chapter 39. It was also described as resin in the compendium of classification of opinions issued by the Directorate of Statistics Intelligence (Central Excise Customs), New Delhi as synthetic resin, covered by Chapter 39 of the Customs Tariff Act, 1975. Thus, according to the appellants herein, Hypalon-40 was assessable as s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apter 40 of the Customs Tariff Act, 1975 showed that synthetic rubber was "unsaturated synthetic substance". The report of Indian Institute of Technology, however, was silent on this issue. The Trial Court further noted that Note 4 to Chapter 40 indicated that synthetic rubber could be irreversibly transformed into non-thermoplastic substance by vulcanization with sulphur. According to the test report of Indian Institute of Technology, which is based on sulphur vulcanization of Hypalon-40, it is clear that Hypalon can be vulcanized by sulphur and thus can be irreversibly transformed into an elastic and non-thermoplastic substance. The I.I.T. report further shows that on vulcanization, the matter could be extended to about four times origina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... saturated substance as it ought to be under the said Note. The learned Trial Judge untimately concluded that none of the said two test reports could be said to be conclusive regarding the actual character and composition of Hypalon-40 as to whether it was synthetic rubber or synthetic resin. 6.The learned Trial Judge referred to the rules for the interpretation of the 1st Schedule to the Customs Tariff Act, 1975. Rule 4 provided that goods not falling within any heading of the Schedule should be classified under the heading appropriate to the goods to which they were most akin. Having regard to the test report of Indian Institute of Technology, which showed that Hypalon-40 on testing responded to some of basic qualities of synthetic rub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an ordinary meaning according to common parlance, it is in the latter sense that in a taxing statute, the word must be held to have been used, unless contrary intention is clearly expressed by the Legislature. If special types of goods is subject-matter of a fiscal entry, then that entry must be understood in the context of that particular trade, bearing in mind that particular word. The trade meaning is one which is prevalent in that particular trade where such goods are known or traded. The Court also held that the trade notices and Tariff Advices are not relevant as such in construing items for Tariff Schedule. 9.In this case, we find that Hypalon-40 is manufactured by only one concern in the world, namely DU PONT DE NEMOURS INTERNATI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g was negatively and selectively oriented. The test was directed only for the ouster of Hypalon 40 from the classification of synthetic rubber. There is another loophole in the report. It made a leap for the conclusion that it was synthetic resin, though exclusion from synthetic rubber does not necessarily bring the item under synthetic resin. An item not being synthetic rubber has again to be proved by test whether it is synthetic resin. It is not in dispute that the customs authorities conducted no test in that direction. To our mind, the report of the Indian Institute of Technology merits more attention and credibility. It conducted the test in a more comprehensive manner. It found Hypalon to be a polymer. It further found that the item ..... X X X X Extracts X X X X X X X X Extracts X X X X
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