Back
1981 Supreme(AP) 284
Andhra Pradesh High Court
Judges : RAMANUJULU NAIDU
Venkatesware Stainless Steel and Wire Industries - Appellant
Versus
Government of India - Respondent
Decided On : 11-16-81
The classification of goods under the Indian Customs Tariff (ICT) should be based on the definitions given by the Indian Standards Institution (ISI), where the goods are not specifically defined in the ICT.
Headnote:
CUSTOMS - REFUND OF EXCESS DUTY - IMPORT OF STAINLESS STEEL STRIPS - CLASSIFICATION OF GOODS - INTERPRETATION OF NOTIFICATION - DEFINITIONS OF STRIP AND SHEET - APPLICATION OF INDIAN STANDARDS INSTITUTION (ISI) DEFINITIONS - RELEVANCE OF BRUSSELS TARIFF NOMENCLATURE.
Fact of the Case:
The petitioner, a small-scale industrial unit, imported stainless steel strips in coils of 48" width. Customs duty was levied on the goods as sheets under Item No. 63 (20a) of the Indian Customs Tariff (ICT), instead of strips under Item No. 63 (14), which carried a lower duty rate. The petitioner claimed a refund of the excess duty paid, but the claim was rejected by the customs authorities. The petitioner filed a revision petition with the first respondent, who confirmed the rejection order.
Finding of the Court:
The court held that the goods imported by the petitioner were strips and not sheets, and were therefore classifiable under Item No. 63 (14) of the ICT. The court relied on the definitions of strip and sheet given by the Indian Standards Institution (ISI) and held that the definitions given by the Brussels Tariff Nomenclature were not applicable in this case. The court also held that the notification issued by the Central Government, which reduced the duty on cold rolled hoops and strips of stainless steel of 250 mm width or more, applied to the goods imported by the petitioner.
Issues: 1. Whether the goods imported by the petitioner were strips or sheets for the purpose of classification under the Indian Customs Tariff (ICT). 2. Whether the definitions of strip and sheet given by the Indian Standards Institution (ISI) should be applied in interpreting the ICT. 3. Whether the notification issued by the Central Government, which reduced the duty on cold rolled hoops and strips of stainless steel of 250 mm width or more, applied to the goods imported by the petitioner.
Ratio Decidendi: 1. The court held that the goods imported by the petitioner were strips and not sheets, based on the definitions given by the Indian Standards Institution (ISI). The court noted that the goods were supplied in coiled form, which is a characteristic of strips, and that the width of the goods (48") exceeded the limit of 500 mm specified for sheets in the Brussels Tariff Nomenclature. 2. The court held that the definitions of strip and sheet given by the ISI should be applied in interpreting the ICT, as they were based on the meaning attached to the goods in Indian commercial parlance. The court noted that the Brussels Tariff Nomenclature had not yet been adopted in India and that the ISI definitions were more relevant to the Indian context. 3. The court held that the notification issued by the Central Government, which reduced the duty on cold rolled hoops and strips of stainless steel of 250 mm width or more, applied to the goods imported by the petitioner. The court noted that the notification did not specify any limitation on the width of the strips, and that the goods imported by the petitioner met the width requirement.
Final Decision: The court quashed the order of the first respondent and directed the respondents to refund the excess duty collected from the petitioner.
( 1 ) THIS petition is filed for issue of a Writ of Certiorari or any other order or direction in the nature of such a Writ calling for the records from the first respondent pertaining to order No. 822b/77 of 1977 on its file and quashing the order dated 22-12-1977 passed therein.
( 2 ) THE petitioner is a Small Scale Industrial Unit registered with the Director of Industries, Government of Andhra Pradesh under Registration No. 88/ssi/indom/f/61 dated 24-4-1967. The Industrial Unit is owned by registered firm known as Keshavji Ravji and Co. , Madras, its principal business being that of Imports and Exports. The Head Office of the firm is at Madras. It has a Branch at Bombay and a factory at Hyderabad. The Petitioner manufactures automobile ancillaries as well as stainless steel hospitalware, stainless steel utensils, surgical instruments, etc. For the purpose of manufacturing its products, the petitioner requires stainless steel sheets, strips and circles as also imported Heat Resistance Steel (H. R. S. ). The petitioner imported one consignment of heat Resistance Stainless Steel strips in coils of 48" width in eight crates from Switzerland to Bombay per S. S. Schwerin. The weight of the consignment was 25,995 Kgs. The strips were of AISI 309, 26 guage, (i. e. , 0. 5 mm ). The number, the date of Bill of Entry and the C. I. F. value of the consignment are as follows :- E/e Cash No. 5995 dated 27-9-1971. . . Rs. 1,88,455. 00. The above-mentioned Bill of Entry was filed for clearance before the Assistant Collector of Customs (Appraising), C. Group, Bombay (the 4th respondent herein) on 1-9-1971.
( 3 ) IT is alleged that by oversight the petitioner paid customs duty on the goods equivalent to 100% of the C. I. F. value of the goods, as per the assessment of the 4th respondent classifying the goods under item No. 63 (20a) of the Indian Customs Tariff (I. C. T. ). Later on, the petitioner realised that the goods fell under item No. 63 (14) and not item No. 63 (20a) of the I. C. T. In view of the notification No. 118/65 dated 20-8-1965 issued by the Government of India as amended by notification No. 138/65 dated 25-8-65 hereinafter called, the notification, the duty payable was only 10% and not 100% of the C. I. F. value. The petitioner, therefore, submitted an application dated 20-3-1972 to the 3rd respondent claiming refund of the excess amount of duty of 90% wrongly paid. The application was rejected by the 3rd respondent by his order dated 3-5-1972 on the ground that it was barred by time. The petitioner thereupon preferred an appeal before the 2nd respondent assailing the order of the 3rd respondent and the 2nd respondent by his order dated 20-3-1973 allowed the appeal and remanded the matter to the 3rd respondent for disposal on merits. After remand, the 3rd respondent by his order dated 3-4-1973 rejected the claim of the petitioner holding that the goods were Stainless Steel Sheets, answering the description of item No. 63 (20a) of the ICT and not strips answering the description of item No. 63 (14) of the ICT. The petitioner again preferred an appeal to the 2nd respondent on 4-7-1973 questioning the order of the 3rd respondent. The 2nd respondent rejected the appeal of the petitioner by his order dated 9-1-1975 holding that in order to claim benefit of the notification the width of strips should not exceed 5" (125 mm ). The petitioner thereupon filed a revision application before the first respondent under Section 131 of the Customs Act. Relying upon the specifications given in Brussels Tariff Nomenclature in preference to those given by the Indian Standards Institution, the first respondent, by their order dated 20-12-1977 confirmed the order that is assailed in the Writ Petition.
( 4 ) THE First Schedule to the Indian Tariff Act, 1934, hereinafter referred to as the Schedule, lists out both dutiable goods and rates of duty of customs leviable thereon under the Customs Act, 1962. Item No. 63 (14) of the
