TMI Blog1996 (9) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... s made. As stated, the evidence led in this case conclusively goes to show that Nylon Twine manufactured by the assessees has been treated as a kind of Nylon Yarn by the people conversant with the trade. It is commonly considered as Nylon Yarn. Hence, it is to be classified under Item 18 of the Act. Appeal dismissed. - 715 of 1981 with 11644 & 7564 of 1996 - - - Dated:- 9-9-1996 - S.P. Bharucha and K.S. Paripoornan, JJ. [Judgment per : Paripoornan, J.]. - Special leave granted in S.L.P. (C) No. 11008 of 1988. 2.The above three appeals involve a common question of law, namely, whether "Nylon Twine" can be considered as "Nylon Yarn" so as to be covered by Item 18 of the First Schedule to the Central Excises and Salt Act, 1944 (hereinafter referred to as "the Act") as it stood prior to the Amendment of 1977. "18. RAYON AND SYNTHETIC FIBRES AND YARN Tariff Item Description of goods Rate of duty Basic 18. RAYON AND SYNTHETIC FIBRES AND YARN INCLUDING TEXTURED YARN, IN OR IN RELATION TO THE MANUFACTURE OF WHICH ANY PROCESS IS ORDINARILY CARRIED ON WITH THE AID OF POWER :- (i) Fibres and Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Union of India (Revenue) against the judgment and order of the High Court of Bombay dated, 9-4-1980 rendered in Special Civil Application No. 2974/78. In the other two cases, the judgment in Special Civil Application No. 2974/78 was followed. The judgment in the said Special Civil Application is reported in 1980 (6) E.L.T. 249 (Bom.). 6.The respondents-assessees manufacture "Nylon Yarn" and "Nylon Twine". They are doing so ever since 1962. Under first schedule, Item 18 of the Act excise duty is payable in respect of "Nylon Yarn" as specified therein. The notification issued under Rule 8 of the Excise Rules provided that "Nylon Yarn", which is meant for use in the manufacture of fishing nets and parachute cords is exempt from the payment of so much of excise duty leviable under Item 18 as is in excess of Rs. 4/- per kg. The assessees contended that "Nylon Twine" manufactured by them is used for the purpose of making fishing nets. Prior to 1975 they were allowed to clear Nylon twine manufactured by them on payment of excise duty as specified under the above exemption notification. Thereafter, when the new item, viz. Item 68 (residuary entry) was introduced in the Act, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . the burden is on the taxing authorities to show that the item in question is taxable in the manner claimed by them." (Emphasis supplied) The learned Judge, therefore, directed the Revenue to refund to the assessees the excess amount collected from them as Central Excise Duty on the basis that "Nylon twine" falls under Item 68 of the First Schedule to the Act. 8.Sri P.A. Chaudhary, Senior Advocate, appearing for the Union of India - appellant, contended that Nylon Twine is different from Nylon Yarn, that Item 18 of the Act would cover only "Nylon Yarn" and not Nylon Twine; that a mere look of Nylon will go to show that it is different from Nylon Yarn; that in commercial parlance different words are used for Nylon Twine and Nylon Yarn and the said goods have different user and different physical characteristics. He stressed that Nylon Twine - the commodity involved in the instant case is not known as "Nylon Yarn" and so, the same is outside the purview of Item 18 of the Act. Certain decisions of general application were also cited. Counsel for the respondents - assessees contended that the Nylon Twine is nothing but Nylon Yarn, other than textured yarn and referred to the Encyc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cular meaning, though it may differ from the common or ordinary meaning of the words." We would only add that there should be material to enter appropriate finding in the case. The material may be either oral or documentary evidence." (Emphasis supplied) 11.In a subsequent decision in Collector of Central Excise, Chandigarh v. Steel Strips Ltd., Sangrur [1995 (77) E.L.T. 248 (SC) = (1995) 4 SCC 241 - at pages 243-244], another three-member Bench stated the law thus : "................ We find no evidence upon the record in regard to what happens to hot-rolled steel strips before cold-rolled steel strips are produce." xxxxxxxxxxxx It cannot be sufficiently emphasised that when it is the case of the Excise authorities that an article is the result of a process of manufacture and it is commercially distinct and known as such, it is for the Excise authorities to lay evidence in this behalf before the first adjudicating authority regardless of the fact that he is an officer of the Excise Department. There should, ordinarily, be no difficulty in establishing that the article is the result of a process of manufacture; in the event of difficulty, it would be open to the Excise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the subject-matter, in legislation relating to a particular trade, business, profession, art or science, words having a special meaning in that context are understood in that sense. Such a special meaning is called the technical meaning to distinguish it from the more common meaning that the word may have. .................... The Supreme Court "has consistently taken the view that, in determining the meaning or connotation of words and expressions describing an article in a tariff Schedule, one principle which is fairly well settled is that those words and expressions should be construed in the sense in which they are understood in the trade by the dealer and the consumer. The reason is that it is they who are concerned with it, and, it is the sense in which they understand it which constitutes the definitive index of legislative intention." 13.Stated briefly, we should understand, the expression occurring in Item 18 of the Act, in the sense, in which the persons who deal in such goods understand it normally. 14.In this case, apart from the meaning given to the words "Yarn", "Twine" etc., in the standard works referred to by the High Court, two items of evidence stand out p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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