Skip to content


Tata Oil Mills Company Limited Vs. Union of India - Court Judgment

LegalCrystal Citation
SubjectExcise
CourtMumbai High Court
Decided On
Case NumberWrit Petition No. 1117 of 1980
Judge
Reported in1990(47)ELT515(Bom)
Acts Central Excises Act
AppellantTata Oil Mills Company Limited
RespondentUnion of India
Excerpt:
.....elsewhere in subsequent scheme - cosmetics and toiletries in subsequent scheme include perfumed hair-oils - held, petitioner entitled to cash assistance consistent with exports - respondents directed to pay to petitioner cash compensatory assistance by virtue of exports in terms of cash compensatory support scheme. - - thus, without multiplying definitions, it can be safely concluded that 'cosmetics' would cover and include perfumed hair-oils which, as we all know, help beautify the hair and assist its grooming for better appearance. 57. the observations of the division bench completely support the petitioners herein :similarly, it is well-known that perfumed hair-oil is an item of cosmetic & toilet requisite. sethna is right in contending that deletion of a specific entry in the..........public limited company carrying on business as manufacturers and exporters inter alia of perfumed hair-oils and shampoo. petitioner no. 2 tata exports is another public limited company carrying on business as exporters of goods. at all material times petitioner no. 2 acted as an agent of petitioner no. 1 for export inter alia of perfumed hair-oils and shampoo. the petitioners are registered exporters.2. for the year 1978-79 the government of india announced a scheme known as the 'cash compensatory support scheme' (hereinafter the earlier scheme) on exports of certain eligible products. two of such eligible products were 'hair oils perfumed' and 'shampoo' included under the general heading 'toiletries and perfumeries'. the 1st petitioner had during the period 1st april 1978 to 31st march.....
Judgment:

1. Petitioner No. 1 Tata Oil Mills is a public limited company carrying on business as manufacturers and exporters inter alia of perfumed hair-oils and shampoo. Petitioner No. 2 Tata Exports is another public limited company carrying on business as exporters of goods. At all material times petitioner No. 2 acted as an agent of petitioner No. 1 for export inter alia of perfumed hair-oils and shampoo. The petitioners are registered exporters.

2. For the year 1978-79 the Government of India announced a scheme known as the 'Cash Compensatory Support Scheme' (hereinafter the earlier Scheme) on exports of certain eligible products. Two of such eligible products were 'Hair Oils perfumed' and 'Shampoo' included under the general heading 'Toiletries and Perfumeries'. The 1st petitioner had during the period 1st April 1978 to 31st March 1979 exported perfumed hair-oils and shampoo and thus became entitled to and received cash compensatory support in terms of the earlier Scheme.

3. For the year 1979-80 also the Government of India announced the Cash Compensatory Support Scheme (hereinafter the subsequent Scheme). And therein under the general heading 'CHEMICALS AND ALLIED PRODUCTS' was specified item No. 6 as 'Cosmetics and Toiletries, not specified elsewhere (excluding lipstick and shampoo)'. Subsequently, by notification dated 2nd July 1979 the bracketed words supra i.e. 'excluding lipstick and shampoo' were deleted.

4. During this period (1979-80) also, the 1st petitioner exported perfumed hair-oils and shampoo. Applications were thereupon made to the Joint Chief Controller of Imports and Exports claiming in relation thereto the amount of cash assistance under the subsequent Scheme. This claim was rejected on the ground that under the 1979-80 Policy, cash assistance was not permissible against the exported product perfumed hair-oils. Efforts pursuing the said claim were in vain. Hence this petition claiming an order directing the respondents to pay to the petitioners the amount of cash assistance to which they had become entitled in law in terms of the subsequent Scheme.

5. Hearing rival submissions of the respective Counsel Mr. A. J. Rana and Mr. M. I. Sethna and considering the subsequent Scheme as also the Import Policy April 1979-March 1980 and the authorities to which my attention was invited by the petitioners' learned Counsel Mr. Rana, I find the petitioners claim justified and one that deserves to be upheld. Indeed, there was no effective answer thereto. As seen, 'Hair Oils perfumed' was already in the earlier Scheme - a product entitled to cash assistance, being - item B.20.8 under the general heading 'TOILETRIES AND PERFUMERIES' and in terms thereof the petitioners had also received cash assistance. Now, in the subsequent Scheme this item 'Hair Oils perfumed' was not expressly or separately specified but there was Item 6 to the effect 'Cosmetics and Toiletries, not specified elsewhere (excluding lipstick and shampoo)'. One does not find 'Hair Oils perfumed' specified elsewhere. Short question, therefore, is : Does the term 'Cosmetics and Toiletries : include 'Hair Oils perfumed' Only if the answer is yes, will the petitioners be entitled to cash assistance under the subsequent Scheme.

6. Now, neither of these two Schemes defines 'Cosmetics' or 'Toiletries'. In the absence of any definition, the relevant terms must be construed not in a technical sense but as understood in common parlance (See M/s. Sarin Chemical Laboratory v. Commissioner of Sales Tax, U.P., : [1971]1SCR731 ). Now, then, what does the term 'Cosmetics' or 'Toiletries' mean in common parlance There can be no dispute that 'Hair Oils perfumed' is in common parlance accepted as being a cosmetic as also covered by the term 'Toiletries'. And, what is more, this common understanding also accords with the dictionary definition of 'cosmetics'.

Webster's International Dictionary defines 'cosmetics' as 'an external application intended to beautify and improve the complexion, skin or hair'. The Oxford English Dictionary defines the term as 'a preparation intended to beautify the hair, skin or complexion'. Then again, as per Encyclopaedia Britannica cosmetics are substances especially prepared to improve, beautify and generally increase the attractiveness of the person. Thus, without multiplying definitions, it can be safely concluded that 'cosmetics' would cover and include perfumed hair-oils which, as we all know, help beautify the hair and assist its grooming for better appearance. Very rarely indeed would anyone understand perfumed hair-oils any differently.

7. Though in another context (which does not in the least detract its relevance here) the term 'cosmetics and toilet requisites' came up for consideration before a Division Bench of the Allahabad High Court in Commissioner, Sales Tax, U.P. v. Chawla Stores 40 S.T.C. 57. The observations of the Division Bench completely support the petitioners herein :-

Similarly, it is well-known that perfumed hair-oil is an item of cosmetic & toilet requisite. This phrase has been the subject-matter of interpretation in two Supreme Court decisions reported in Sarin Chemical Laboratory v. Commissioner of Sales Tax and State of Gujarat v. Prakash Trading Co. 26. S.T.C. 339 . 'Hair-oil', as the expression itself indicates, is used for dressing hair. Its object is not only to keep the hair tidy, promote its growth, check baldness but also to beautify appearance. As such, there can hardly be any controversy that it is squarely covered by the entry 'cosmetics & toilet requisites'.'

The case of the petitioners receives further support from Appendix 17 of the Government's 1979-80 Import Policy. In this Appendix under general Item 5 - Toiletries and Perfumeries - one finds Item B.20.9 :

'Hair Oils, perfumed and Hair Grooming' and Item B.20.10 :

'Cosmetics N.O.S.' (Not Otherwise Specified)

To an extent, the petitioner' case also receives further support from a rather similar term used in the First Schedule to the Central Excises and Salt Act. Item 14-F thereof has the heading inter alia 'Cosmetics and toilet preparations' and under the said Item one finds included perfumed hair-oils as also shampoo. It should thus be obvious and clear that the term 'cosmetics and toiletries' in the subsequent Scheme would include perfumed hair-oils. The petitioners would, therefore, be entitled to cash assistance consistent with the exports in question and at the rate specified in that regard.

8. It was, however, contended by Mr. Sethna, learned Counsel, for the respondents, that the very fact the specific entry (B.27.8) 'Hair Oils perfumed' in the earlier Scheme stood deleted in the subsequent Scheme indicates that exporters thereof were not entitled to cash assistance under the subsequent Scheme. It is not possible to agree. If one considers Entry 6 in the subsequent Scheme, one finds that it originally specifically excluded shampoo. Now 'shampoo' was itself subject-matter of an independent entry (B.20.10) under the earlier Scheme. If Mr. Sethna is right in contending that deletion of a specific entry in the earlier Scheme from the subsequent Scheme indicates non-entitlement to the exporter of that particular item for cash assistance, then there was no reason to specifically mention and exclude item 'shampoo' from the subsequent Scheme when the same, exactly in the manner assigned like perfumed hair-oils, had also stood deleted from the subsequent Scheme. The very fact that despite such specific deletion, shampoo was again specifically excluded from Item 6 in the subsequent Scheme indicates, to a considerable extent, that the said Item 6 'Cosmetics and Toiletries' while excluding shampoo did not intent to exclude perfumed hair-oils which thus continued to be an item the export of which entitled the exporters to cash assistance. Besides, if a general entry, fairly and reasonably construed and understood, covers a particular product (not otherwise specifically excluded), the exporters thereof would then become entitled to cash assistance under the subsequent Scheme.

9. It would also, to a certain extent, be relevant to note that respondent No. 4, which is an independent Export Promotion Council, had also come to its own independent conclusion that perfumery hair-oils did qualify for cash assistance under the subsequent Scheme. Indeed, respondent No. 4 had also written accordingly to the Ministry of Commerce, Government of India, but with no response either way in that behalf. Fair approach and quick response can help avoid resort to Court. It can also considerably assist in generating a spirit of goodwill between citizens and persons on the one hand and the State on the other.

10. In the affidavit in reply it is contended that in the absence of a specific order from the Ministry of Commerce regarding perfumed hair-oils it cannot be said that the said item is entitled to the benefit of the subsequent Scheme. Now, the question here involved is one of interpretation pure and simple and, in the event of dispute, such interpretation becomes part of this Court's function and responsibility. That is relevant government department is blissfully silent cannot absolve this Court from discharging its own judicial function and responsibility.

11. In all the circumstances I hold that perfumed hair-oil is included in Item 6 'Cosmetics and Toiletries' not specified elsewhere in the subsequent Scheme. The petitioners would, therefore, be entitled to cash assistance in accordance with the said Scheme. There being no dispute on the amount of Rs. 9,72,312/-, no useful purpose would be served in sending back the proceedings and directing the concerned authorities to compute the cash assistance in question. Fair and just order would be to direct respondents Nos. 1 to 3 to pay to the petitioners the said sum of Rs. 9,72,312/- as cash assistance to which they are entitled under the subsequent Scheme.

12. In the result, this petition succeeds and the same is allowed. Respondents Nos. 1 to 3 are ordered and directed to pay to the petitioners the sum of Rs. 9,72,312/- being the cash compensatory assistance to which the petitioners have become entitled by virtue of the exports in terms of the Cash Compensatory Support Scheme announced by the Government of India for the year 1979-80. This amount shall be paid to the petitioners as expeditiously as possible but in any event latest by 1st October 1984.

13. Rule is made absolute in terms aforesaid but, in the circumstances, with no order as to costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //