Satish Chandra, C.J.
1. Messrs R.G. Paper and Straw Board Mills, the petitioner appears to have cleared mill board manufactured by it from 19th December, 1971 to 12th December, 1972, and paid excise duty thereon. On 15th December, 1972, the Superintendent, Central Excise, Hathras, issued a notice to the petitioner to show cause as to why the additional duty be not charged. Apparently he was under the belief that the petitioner has been under charged. The petitioner filed a reply and the matter was ultimately decided by the Assistant Collector, Central Excise, Aligarh on 21st July, 1973, He held :
'I am of the opinion that the Board manufactured by M/s. R.G. Paper and Straw Board Mill manufactured from mixed waste paper along with some percentage of Straw of other agricultural residues does not conform to the specification of a 'mill board' as given in Notification No. 35/64-C.E., dated 1-3-1964 and as such are not eligible for any slab concession.
I, therefore, order that the Board manufactured out of waste paper mixed with straw and cleared by them is to be assessed to duty as Board other sorts at the following rates giving allowance of the duty already paid by them as detailed below :.'
2. The petitioner felt aggrieved and went up in appeal. The appeal was, however, dismissed on 10th March, 1975, by the following finding :-
'The two definitions are independent of each other and the proviso mentioned above is applicable to only straw board and hot to mill board. The appellant's centention that the above proviso applies both to the mill board and straw board cannot be accepted. It is, therefore, obvious that by virtue of the fact that the board manufactured by the appellant with a composition of mixed waste paper, screenings, mechanical pulp as well as bagasse or straw does not fall within the definition of mill board. Also in view of the fact that the above board is not predominantly made out of partially cooked unbleached straw or bagasse or grasses etc. and contains more than one third weight of other materials does not fall within the definition of straw board also.
Having regard to the above facts and circumstances of the case the board manufactured by the appellant has rightly been classified by the adjudicating officer as 'other boards' and does not attract the benefit of notification No 35/64 dated 1-3-64 as amended from time to time. The order appealed against is therefore correct in law and based on facts and I see no reason to interfere with the same.'
3. The petitioner then went up to the Government of India in revision. The revision, however, was also dismissed with the finding :-
'The explanation to Notification No. 67/66 defines the terms 'mill board' and 'straw board' for purposes of that notification. Proviso (1) refers to the quantity of any other material used which shall not exceed l/3rd in weight of the total weight of the ingredients. In defining a mill board, it has been provided that it is to be made out of mixed waste papers and mechanical pulp. There is no provision therein for any other ingredient being used. The question of limiting the quantity of any 'other material used' in the manufacturing of a millboard does not therefore arise for determination. Hence, the proviso cannot be applicable to millboard. In the case of strawboard, it is stated that it is made wholly or predominantly from unbleached straw or bagasse or grasses or a mixture of these. When a strawboard is made predominantly from any of these items or a mixture thereof, there is scope for the use of any other material and hence the need to fix a limit therefor. Under the circumstances, it is clear that the proviso to the Explanation refers only to strawboard and not to millboard.'
Thus, according to the Assistant Collector the board manufactured by the petitioner was not millboard as defined in the relevant notification because it had some percentage of straw or other agricultural residue. The appellate authority upheld this view. In addition it held that since the board manufactured by the petitioner contained more than onethird weight of other material, even the proviso was not satisfied. Thirdly it also held that the proviso was applicable only to strawboard and not to millboard. The Centra] Government in its revisional order upheld the finding of the appellate authority that the proviso was not applicable to millboard. It did not go into the question whether the proviso was, on facts, satisfied or was excluded. It does appear to us that the appellate as well as the revising authorities were agreed that the proviso was not applicable to millboard.
4. The relevant portion of the notification in question reads :-
'Explanation.-For the purposes of this notification-
(1) 'mill board' means any unbleached homogenous board, having a thickness exceeding 0.50 millimetre and made out of mixed waste paper with or without screenings and mechanical pulp but without any colouring water being added thereto ;
(2) 'straw board' means a board made wholly or predominantly from partially cooked unbleached straw or bagasse or grasses or a mixture of these :-
(i) the quantity of any other material used shall not exceed one third in weight of the total weight of the ingredients, and
(ii) such board shall not be specially compressed and shall not have any paper pasted on either surface.'
5. The authorities below have taken the view that the proviso, which refers to other materials being used, is on its terms applicable to strawboard only and not to millboard because in the definition of millboard there is no scope for using any other material. It is true that the definition of millboard does not speak expressly of material other than mixed waste paper with or without screenings and mechanical pulp being used in the manufacture of the mill board, but it is equally true in regard to the definition of the term 'strawboard' which means 'a board made wholly or predominantly from partially cooked unbleached straw or bagasse or grasses or mixture of these'. Here also one does not find any express reference to any other material being used in the manufacturing process. From the linguistic point neither the definition of millboard nor of strawboard specifically requires the use of any other material; nor the two definitions expressly exclude the use of any other material in the manufacturing process either of the millboard or of the strawboard. It thus appears to us that the proviso will be applicable to both the clauses, namely, clause (1) which defines 'millboard' as well as to clause (2), which defines 'strawboard'.
This construction of the proviso is strengthened by the admitted position that Clause (ii) of the proviso, namely, (such board shall not be specially compressed and shall not have any paper pasted on either surface) is admittedly applicable to both Clauses (1) and (2) of the Explanation which define 'millboard' and 'strawboard' respectively.
6. Neither on its language nor in its setting is there any indication that Clause (1) of the proviso applies exclusively to the definition of strawboard and not to that of the millboard. We are hence unable to endorse the opinion expressed either by the appellate or the revisional authority. The appellate Collector specifically held that :-
'Also in view of the fact that the above board is not predominantly made out of partially cooked unbleached straw or bagasse or grasses etc. and contains more than one third weight of other materials does not fall within the definition of strawboard also.'
It is immaterial whether the board manufactured by the petitioner answers the definition of strawboard but the relevant and material finding appears to be that the board manufactured by the petitioner contains more than onethird weight of other material. That is relevant because under Clause (i) of the proviso it has been prescribed that the quantity of any other material shall not exceed onethird in weight of the total weight. If this finding were to remain the petitioner would be out of Court because on facts the proviso will become inapplicable.
7. But the story does not end here. In the Central Government's order disclosing of the revision it has been observed :-
'The question of limiting the quantity of any 'other material used' in the manufacturing of a millboard does not therefore arise for determination.'
It is apparent that the Central Government did not go into this question.
8. We have, however, held that Clause (i) of the proviso in question will apply to the definition of the millboard as well as of strawboard. In this context it is necessary to decide whether the other material used by the petitioner in the manufacture of the board is in excess of onethird by weight of the total weight of the ingredients. If it exceeds onethird then Clause (i) of the proviso will not apply, otherwise it will.
9. In the result the petition succeeds and is allowed and the impugned order passed by the Central Government dated 5th of October, 1977 is quashed and the matter is sent back to the Government of India for deciding the revision afresh in accordance with law, and in the light of the observations made above. The parties may however, bear their own costs.
10. We are informed that the petitioner had made some deposits of money with the Assistant Collector under an interim order passed by this Court. The Central Government will pass suitable orders with regard to those deposits.