TMI Blog1995 (5) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. It is obvious that the order was made under misapprehension. Since the High Court and the assessing authorities approached the case with an entirely incorrect perspective, their orders cannot be maintained. Yet it would be hazardous for this Court to examine the dimension and specification of these bushes and washers and decide whether they can be classified as thin-walled bearings. For that purpose it would be expedient to send the case back to the High Court which may decide it either itself or send it to the Tribunal which has now been constituted. Appeal allowed. - 225 of 1991 - - - Dated:- 9-5-1995 - R.M. Sahai and S.C. Sen, JJ. [Judgment per : R.M. Sahai, J.]. - The principal issue that arises for consideration in this appeal is whether `thrust washers', `thrust half-washers' and `wrapped' bushes manufactured by the appellant exclusively for Motor Vehicles could be classified as `Thin walled-bearings' so as to attract duty under Notification No. 99 issued in 1971. Apart from this, another legal question which has cropped up mainly due to the High Court's finding and approach of departmental authorities whether a goods which has a meaning assigned to it with c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty from 1971 onwards. In February, 1978 a meeting was called by the Board in which representatives of the trade participated. Two decisions appear to have been taken by consensus, one that such washers and bushes as were manufactured by the appellant were bimetal bearings and second, they could be classified as `Thin-Walled Bearing' if they satisfied the specifications as provided in Indian Standard 4774-1968. The consensus arrived at the meeting is extracted below :- Bushes, bearings and thrust half-washers would fall within"(i) the category of bearings; the question whether a bearing should be considered as a(ii) thin-walled bearing should be decided after taking into account the other relevant dimensions as laid down in I.S.I. specification IS : 4774-1968 (it was understood that this had not been further revised). the question whether a bearing was or was not "bimetallic"(iii) or "multi-metallic" would not be relevant for deciding whether it was a "thin-walled bearings"." 5.This led to issuing of Trade Notice dated 23rd September, 1978 which reads as under :- "It is considered that valve rocker arm bushes, axle bushes, suspension bushes steering bushes, thrust washers, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... `thin-walled bearing' and therefore not excisable from the date of exemption notification." 8.The Assistant Collector did not agree and held that since the goods manufactured by the appellant were thin-walled bearings falling under Item No. 34A, it was liable to pay duty on these goods. The Assistant Collector did not accept the claim of the appellant that only bearings which are manufactured according to the specification mentioned in Table Nos. 2 to 5 of ISI were liable to be classified as thin-walled bearings. In appeal the Collector of Central Excise held :- "According to this specification, thrust washer is used at one or each end of a plain jurnal bearing in order to take light duty thrust loads, a function performed by a bearing. Therefore, technically it will not be incorrect to call thrust washers including thrust half-washers, which are nothing but one half of a split thrust washer, as bearings. Similarly, a wrapped bush is a bush with a longitudinal split in one place and bush means a bearing liner in the form of a complete tube covering 360 degree. Bearing liner is a tubular element whose inner surface is the bearing bore. Thus, bushes of the type manufactured by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cloth General Mills, 1977 (1) E.L.T. (J 199) = (1963) Supp. 1 SCR 586 and it was urged that the specifications by the Indian Standard Institute furnished very strong and indeed incontrovertible evidence and, therefore, the High Court was in complete error in its opinion that the Indian Standard specifications do not reflect trade understanding. The learned counsel challenged the finding recorded by the High Court on merits and urged that the specifications as given by the Indian Standard Institute have not only been understood erroneously, but even applied incorrectly as the Assistant Collector found that the bush and bearing manufactured by the appellant were of dimension of 4775 and the consensus having been arrived at the meeting between the Board and the trade representatives for including those bushes and washers which were of dimension of 4774 the High Court could not have in absence of any other material held that the goods manufactured by the appellant were thin-walled bearings. On the other hand Shri A.K. Ganguly, learned Senior Counsel appearing for the Department urged that it has been held by a Constitution Bench of this Court in M/s. Novopan India Ltd., Hyderabad v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extracted earlier. Therefore, before a decision was taken by the Board, there was no material available with the Department which could furnish basis for deciding whether bushes or washers manufactured by the appellant could be classified as bearing much less `thin walled bearing' within the meaning of notification issued in 1971. Not only that the entire proceedings were initiated by the Superintendent of Central Excise on the basis of trade notice referred to earlier inviting the appellant to classify these goods as `thin walled bearings' if they satisfied the specification of 4774. It is true, as held by the High Court and by the authorities that a trade notice is not binding, but what the High Court omitted to consider was that there was no other material with the Department on which it could assume that the washers and bushes manufactured by the appellant were `thin walled bearings'. The basis for initiation of proceedings being Indian Standard Booklet published by the Indian Standard Institute, it was not proper either for the High Court or for the assessing authorities to ignore it and levy the duty treating these goods to be `thin walled bearings', on assumptions without an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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