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Arvico Industries Vs. Collector of Central Excise - Court Judgment

LegalCrystal Citation
CourtCustoms Excise and Service Tax Appellate Tribunal CESTAT Delhi
Decided On
Reported in(1984)(16)ELT413TriDel
AppellantArvico Industries
RespondentCollector of Central Excise
Excerpt:
.....this appeal relates to assessment of the following two items under tariff item 33c of the central excise tariff: (ii) stainless steel rectangular beverage jugs, electrically operated.the deputy collector of central excise, bombay ordered that these two items should be assessed under t.i. 33 ibid and were snbjected to central excise duty under notification no. 33/69-c.e., dated 1-3-1969.he held that the item at si. no. (1) above namely, hot cups, electrically operated were nothing but electric kettles which are dutiable under. si. no. 14. of the schedule to the said notification.he further held that hot beverage jugs were food warming cabinets and accordingly, were dutiable under sl. no. 16 of the schedule to the said notification. the appellate collector confirmed this order. besides,.....
Judgment:
1. This is a revision application preferred by M/s. Arvice Industries, Bombay against the Order-in-appeal No. 1014/1977 dated 15-9-1977, passed by the Appellate Collector of Central Excise, Bombay which has been transferred to the Tribunal an 1 is now being considered as appeal, 2. The short point involved in this appeal relates to assessment of the following two items under Tariff Item 33C of the Central Excise Tariff: (ii) Stainless Steel Rectangular Beverage Jugs, electrically operated.

The Deputy Collector of Central Excise, Bombay ordered that these two items should be assessed under T.I. 33 ibid and were snbjected to Central Excise Duty under Notification No. 33/69-C.E., dated 1-3-1969.

He held that the item at SI. No. (1) above namely, Hot Cups, Electrically operated were nothing but Electric Kettles which are dutiable under. SI. No. 14. of the Schedule to the said Notification.

He further held that Hot Beverage Jugs were Food Warming Cabinets and accordingly, were dutiable under Sl. No. 16 of the Schedule to the said Notification. The Appellate Collector confirmed this order. Besides, the Deputy Collector of Central Excise had also confiscated 25 hot cups under Rule 173Q of the Central Excise Rules, 1944 and imposed a fine of Rs. l.000/- in lieu of confiscation and a penalty of.Rs. 500/- was also imposed under Rule 173Q of the Central Excise .Rules, The. Appellate Collector upheld this order as well.

3. In their appeal before the Tribunal, Miss Rainu Walia, Advocate appearing on behalf of the appellants argued that the above items namely, Hot Cups and Rectangular Jugs could not be considered as 'Domestic Electrical Appliances', 'Not Elsewhere specified' under T.I.33C of the Central Excise Tariff. She further contended that the Explanation I to T.I. 33C ibid should be read subject to the description in the main Tariff Heading under T.I. 33C i.e. 'Domestic Electrical Appliances'. In other words, all items to be dutiable first have to be Domestic Electrical Appliances even though they may be actually used on Aircraft, Hospitals, train kitchens etc. as specified in Explanation I to the said Tariff Item. She further contended that even if these two items can be considered as falling under Explanation I to the said T.I., they could not be subjected to Central Excise duty under the aforesaid Sl. Nos. 14 and 16, since they could not be considered as 'Kettles or Food warming cabinets' which alone are dutiable under the aforesaid Notification No. 33/69-C.E. dated 1-3-1969. She also added that these items could not be considered as Kettles or Food Warming cabinets in common parlance. She cited the following authorities in support of her statement :M/s. Indo-International Industries v. Commissioner of Sales-tax, U.P.-1981 E.L.T.M/s. Dunlop India Ltd. v. Union of India-AIR (iii) M/s. Healthways Dairy Pioducts Co., Gauhativ. Union of India- 1978 E.L.T. J 457 and (iv) Sales Tax Commissioner v. S.N. Brothers-AIR 1973 S.C. 78.

She argued that in the matter of interpretation of taxation under the Central Excise law, we should attach importance only to trade and popular meaning of the expressions or words/articles used and not to their scientific or technical meaning or the meaning derived from dictionary which cannot be trusted as self guide for the purpose. She, therefore, pleaded that these two items should not be subjected to Central Excise duty and the fine and penalty imposed on the appellants be remitted.

4. Sh. V. Lakshmi Kumaran, Senior Departmental Representative on behalf of the respondent argued that Explanation I has in fact enlarged the meaning of domestic Electrical appliances and all similar appliances used for hospitals, railways, kitchens, aircrafis etc. would be deemed to be domestic electrical appliances for the purpose of charging and levying duty under Tariff Item 33C of the Central Excise Tariff.

Countering the arguments of the learned Advocate of the appellants, he further stated that these items were nothing but 'Kettles and food warming cabinets' although they may exclusively be used on the aircrafts. He further clarified that in the case of M/s. Dunlop India Ltd. referred to above, case refers only to case where the tariff entries itself uses an article. In the present case, the use of the article is important since it is part of the article itself.

5. Having considered the points and submissions made by both the parties, the Bench is of the view that Explanation I to Item 33C of the Central Excise Tariff does enlarge the meaning of the expression 'Domestic Electrical Appliances' and all similar appliances which are used in household, hospitals, railways, kitchens, aircraft etc. as stated in Explanation I would be liable to Central Excise duty under T.I. 33C. We, therefore, agree with the Departmental Representative on (his point. However, regarding the liability to duty of these two hems under the aforesaid Notification No. 33/69-C.E., dated 1-3-1969 under T.I. 33C, we are inclined to agree with the learned Advocate of the appellants. The lower authorities have not adduced any evidence to show that the Hot Cups could be considered as domestic electrical appliances and as to how hot cups could be considered as synonymous with Electric Kettles. Similarly, no reasons have been given by them to show that 'hot beverage jugs' could be considered to be same as food warming cabinets under Sl. No. 16 of the Schedule to the said Notification. The learned Advocate for the appellants also referred to the Central Board of Excise and Customs' Tariff Advice No. 36/78, dated 1-7-1978, to the effect that Rectangular Beverage Jug (Hot) would be classifiable under Item No. 33C of the Central Excise. It will,not, however, be covered under Sl. Nos. 9, 14 and 16 of the Schedule to Notification No.33/69-C.E., dated 1-3-69. She further added that the said Notification No. 33/69-C.E. had now been amended on 17-4-1979 by Notification No.165/79-C.E., dated 17-4-1979 and Item Rectangular Beverage Jugs (hot) was added at Sl. No. 21 to the said Notification w.e.f. 17-4-1979 only.

Accordingly, she stated that this item could not be subjected to Central Excise duty for the earlier period i.e. prior to 17-4-1979.

6. Having considered the submissions made by both the parties, we are of the view that Electric Kettles and Hot food cabinets could not be considered Hot Cups and Rectangular Beverage Jugs (Hot). We, therefore, set aside the orders of the lower authorities and direct consequential refund of duty, fine and penalty to the appellants. The appeal is allowed.


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