1. The point of dispute involved in the present proceedings is whether (1) glass windscreens of motor vehicles, both of toughened as well as laminated variety, and (2) insulating glass units/panels fall under Item 23A(4) of the Central Excise Tariff ("Other glass and glassware including tableware"), as held by the lower authorities, or under Item 68 ("All other goods, not elsewhere specified..."), as urged by the appellants.
2. The impugned Order-in-Appeal held that the following three products manufactured by the appellants were classifiable under Item 23A(4) :- However, in respect of glass mirrors, the Collector (Appeals) held that the same were classifiable under Item 68. The present appeal and the cross-objection relate only to the first-mentioned three products held to be classifi-able under Item 23A(4) by the Collector (Appeals). In respect of glass mirrors, there is a separate appeal filed by the Department and the same is not the subject-matter of the present proceedings.
3. Even in respect of the three products held by the Collector (Appeals) to be classifiable under Item 23A(4), the appellants stated before us in categorical terms that their appeal was restricted to- (i) fully finished glass windscreens, both of toughened and laminated variety, which were ready for fitment to motor vehicles ; and (ii) insulating glass units/panels having aluminium tubular frame/encasement and in which a dessicant had been injected into.
The appellants made it clear that besides the above two disputed items, they were manufacturing certain sundry items of laminated and safety glass such as table lops, peep holes for boilers, glass parts of refrigerators etc. and that they accepted the Collector (Appeals) order for classification of these sundry glass items under Item 23A(4).
4. Out of the two disputed items, consideration of classification of windscreens was taken up first. It was pointed out that there was an earlier order of this Bench (Order No. 74/84-D, dated 17-1-84 passed in Appeal No. 1365/82-D of M/s. Trutuff Safety Glass Industries, Ghaziabad) in which it had been held that toughened glass windscreens were classifiable under Item 68. This order in turn relied on the Bombay High Court judgmnt in the case of Messrs Maharashtra Safety Glass Works] 1982 E.L.T. 237 (Bom.) relating to classification of windscreens and the Supreme Court judgement in the case of M/s. Indo International Industries (1981 E.L.T. 325). While the appellants took the stand that the issue stood settled by these three judgments of the Supreme Court, the Bombay High Court and this Tribunal, the Department's Representative sought reversal of the earlier order of the Tribunal on the basis of what he called fresh material and new points.
He stated that there was no bar to the Tribunal reconsidering its earlier stand provided fresh material was brought to its notice. The fresh material and new points, according to him, were as under :- (1) The Bombay High Court judgment related to the pre-1979 period when Item 23A(4) did not include "Other glass" while Item 34A covered all motor vehicle parts. The Bombay High Court held that windscreen was commercially understood as a motor vehicle part and not as glassware and hence Item 34A was more specific to cover it than the generic entry "Other glassware" in Item 23A(4). The situation, however, underwent a change when both Tariff Items 23A(4) and 34A were amended on 1-3-79. The amendments included the words "Other glass" in Item 23A(4) while they restricted the description of Item 34A to certain specified motor vehicle parts, windscreen not being one of them. The Department's Representative argued that with Item 34A being no longer applicable, the competing entries were now 23A(4) and Item 68 and as between these two entries, the former was more specific for glass windscreens than the residuary entry 68. He stated that the Bombay High Court had held that windscreen was not "glassware" as understood commercially. He clarified that the Department's stand now was that glass windscreen was classifiable as "Other glass" under Item 23A(4) and not as glassware. In support of this argument, he cited the order of this Bench in the case of M/s.
Ramdas Motor Transport Ltd. (1983 E.L.T. 2067) in which, in the context of the amended Item 34A, it was held that hub, bolts and nuts were assessable to duty as bolts and nuts under Item 52 and not as unspecified parts of motor vehicles under Item 68. In passing this order, the Bench had not given any weight to the fact that hub, bolts and nuts were stocked and sold by auto, parts dealers and not by hardware merchants. The Bench had not given any weight to this fact in their order on frit glass (1983 E.L.T. 1249) also and classified frit glass as "Other glass" under Item 23A(4) on the ground that by definition it was glass. He pleaded that the same analogy should hold good for windscreen also.
(2) No doubt, windscreens were cut to particular shape and size and had holes drilled in their body for fitment to motor vehicles. No doubt also that their glass had acquired improved qualities of toughness and vision in the course of manufacture. But, in spite of these features, windscreens were still basically glass only. He stated that the British Standards Specification (BS 857-1967) as well as the Indian Standards Specification (IS : 1382-1961 both dealt with toughened safety glass and laminated safety glass under the generic heading glass only.
(3) End use of the glass was not relevant in this case since Item 23A(4) contained no stipulation as to end use [reliance on 1983 E.L.T. 947 (Madras), 1983 E.L.T. 1017 (CEGAT) and 1980 E.L.T. 600 (All.)] (4) The Supreme Court judgment in the Indo-International case related to classification of glass syringes under the Sales Tax law while the present proceedings were in respect of classification of glass windscreens under the Central Excise Tariff, (5) The Department's Representative quoted from a few invoices of the appellants to say that the appellants had been selling laminated glass and toughened glass to M/s. Sehgal Glass Works, M/s. Doaba Sugar Mills, M/s. Kelvinators etc., that is, the parties who were admittedly not manufactures of motor vehicles nor dealers of motor vehicle parts.
(6) There was no double taxation involved in assessing glass windscreens under Item 23A(4). Plain glass sheets used in their manufacture had earlier paid duty under a separate sub-item of Item 23A. There could be no dispute about the proposition that when the raw material and the finished goods fell under two separate sub-items of the same Item, they had to be treated as two different commodities and taxed separately under the respective sub-items.
Additionally, proforma credit of the duty already paid on plain glass sheets was admissible under Rule 56A of the Central Excise Rules, 1944. In the circums tances, there can be no question of double duty under Item 23A at all.
(7) If articles like glass windscreens were not assessed under sub-item 23A(4), that entry would become redundant. It was settled law that any interpretation which made a provision of law nugatory had to be avoided.
Cross-objection filed by the Department consists practically of the same arguments as stated above and all that it seeks from us is that the impugned order should be upheld and the appeal for re-classification of the goods under Item 68 rejected. In other words, the Cross-objection does not seek any relief over and above the order of the Collector (Appeals).
5. The appellants vehementally asserted that the Bombay High Court, while deciding the classification of windscreens, had in view both the old as well as the amended tariff descriptions and in its judgment the High Court in fact quashed the Collector's Trade Notice dated 10-1-80 based on the Board's Tariff Advice No. 60/79, dated 18-12-79 which in turn was based on the tariff amendments of 1979. They also stressed the point that the CCCN classified windscreens as motor vehicle parts under heading 87.06 and not as glass and glassware and the Bombay High Court had also taken note of this fact in their judgment. Though the revised scheme of the Indian Trade Classification treated windscreens differently, the introductory note to this scheme made it clear beyond doubt that it was intended solely for the purpose of collection of trade statistics and that it was not binding on the Customs authorities. Regarding the sale invoices issued in the name of M/s.
Sehgal Glass Works, they stated that this firm was a wholesale dealer in windscreens, besides other glass items. Regarding the invoices issued to a sugar factory and a manufacturer of refrigerators, they stated that the items supplied to these parties were not windscreens but sundry items of safety glass and laminated glass like peep-hole covers for boilers, frig, parts etc. and that the appellants had already made it clear that they were not contesting the order of the Collector (Appeals) in regard to the classification of these sundry items. Finally, they stated that M/s. Maharashtra Safety Glass Works, M/s. Hindustan Safety Glass Works and M/s. Trutuff Safety Glass Industries had been allowed to pay duty on their glass windscreens under Item 68 by the Bombay High Court, the Appellate Collector and this Tribunal, respectively. To their knowledge, the Department had not filed any appeal against the judgment of these three authorities. If now the windscreens manufactured by the present appellants were classified under Item 23A(4), they would stand heavily discriminated against and they would not be able to face the competition from the other manufacturers aforesaid who were paying duty at a lower rate.
6. We have given our earnest consideration to the matter. We agree with the appellants that the Bombay High Court, while deciding the case of M/s. Maharashtra Safety Glass Works, bad in focus both the old as well as the amended tariff descriptions. We have made this point clear in our earlier order in the case of Messrs Trutuff Safety Glass Industries also. On a perusal of the Bombay High Court judgment, we find that the principal reason why the said High Court rejected Item 23A(4) for windscreens was not because Item 34A was more specific for motor vehicle parts but because the question had "to be approached more from practical and commercial point of view and not from theoretical or academic point of view". The court also specifically considered whether windscreens could be treated as "Other glass" but rejected it holding that glass was the duty paid raw material which had been processed into an entirely different commercial commodity. Since the Bombay High Court judgment was specifically on the product in question, and no contrary judgment was brought to our notice, we decided the earlier Trutuff case on the strength of this judgment. We reiterate our respectful agreement with this judgment once again since we find that the main assertions of the Department's Representative regarding tariff amendments of 1979 and windscreens still being basically glass already stand authoritatively rebutted by the Bombay High Court. The Supreme Court judgment regarding glass syringes in the Indo-International case decided a point of principle as to how "Glassware" was to be interpreted and the court itself made it clear that the principle of interpretation was applicable both in respect of Sales Tax and Central Excise duty.
Analogy sought to be drawn by the Department's Representative with the bolts and nuts case of M/s. Ramdas Motor Transport Company decided by this Bench earlier is not apt. In that case the description of Item 52 ("Bolts, nuts and screws...") was specific by name for the goods involved, viz., hub, bolts and nuts. It was in this context that the question whether the goods were sold by hardware merchants or by auto parts dealers was not given any weight. Analogous situation could exist in the present case if Item 23A(4) contained a specific entry "Windscreens" but that is not so. The ratio of M/s. Ramdas Motor Transport Company case is, therefore, not applicable to the present case. No doubt, there is no stipulation as to any particular use in Item 23A(4), but the fact is that the Bombay High Court judgment as well as the earlier decision of this Bench in Trutuff case are not based on use of windscreens but on the nature and character of that article and how it is commercially understood. Lastly, we fail to see how Item 23A(4) would be rendered nugatory if windscreens are classified under Item 68, as contended by the Department's Representative. Besides tableware, which is specifically included in the entry, the entry would also cover primary glass (such as, lump glass) and articles made of glass not specifically named in sub-items (1), (2) and (3) of Item 23A. To mention by way of example, sundry items of toughened glass and laminated glass manufactured by the present appellants could come under Item 23A(4). We, therefore, find no force in any of the arguments of the Department's Representative and reiterate our earlier order that fully finished windscreens, both of toughened and laminated variety, are classifiable under Item 68.
7. Coming now to insulating glass units/panels, of which we were shown a sample at the time of the hearing, the argument of the Department's Representative for classifying them under Item 23A(4) is that they are basically glass and that insulating glass is mentioned in the I.S.I.and B.S.S. Specifications as falling in the broad category of glass. We find that the product in dispute before us is not insulating glass as such but finished units/panels of insulating glass. These units/panels consist of two layers of glass sheets of matching size encased in an aluminium tubular frame in which a dessicant (hygroscopic material) had been injected. We were informed that these units/ panels are an energy saving device and when fitted as window ones to a roonV they insulate the room from outside temperature, noise etc. They are used by air control towers, the Army hospital at Leh etc. for this purpose. The appellants maintained that going just by the raw material costs, the glass component in these units/panels was only 40 per cent whereas the cost of the aluminium tubing and the dessicant etc. was about 60 per cent. The Department's Representative maintained, on the other hand, that area-wise and weight-wise the glass component was predominant in these units/panels. On seeing the sample and after a careful consideration of the matter, we find that these units/panels are a composite article in which all the three principal materials, namely, glass, aluminium tubing and the dessicant, are not only present in significant quantities but also all the three functionally play an active part. In the scheme of the Central Excise Tariff, the classification of such a composite article cannot be decided on the basis of only one of the active materials. In the absence of a specific entry covering such composite articles in the Tariff, we hold that they are correctly classifiable under the residuary Item 68.
8. To sum up, we order that the two products of the appellants mentioned at sub-items (i) and (ii) of paragraph 3 above shall be classified under Item 68 of the Central Excise Tariff. Any consequential relief accruing to the appellants shall be given to them.
The appeal is allowed in these terms and the cross-objection is rejected.