UNION OF INDIA Vs. RAMAN KANTILAL BHANDARI

JUDGEMENT

(1.) This appeal is filed by the Union of India and two others and is directed against the judgment and order of the learned Single Judge making the Rule obtained by the Respondent Raman Kantilal Bhandari absolute and directing the present Appellants who were Respondents in the Writ Petition to refund an amount of Rs. 15,688.94 p. paid by the petitioner as additional duty on the import of a consignment of Pentaerythritol made in August 1984. In deciding in favour of the Writ Petitioner, the learned Single Judge has held that the said imported goods were a sort of alcohol within the meaning of Entry 68 Schedule, I of the Central Excise and Salt Act and, therefore, exempt from payment of the additional duty by the Petitioner., The, learned Single Judge in this connection had, inter alia, relied upon the Circular Letter No. 4/84 dated 1st October, 1984 issued by the Central Board of Excise and Customs, New Delhi, on the scope of the term; "alcohol of all sorts" appearing in Tariff Item 68. In their said Circular dated 1st October, 1984 the Board had, inter alia, stated:

(2.) By an amendment which came into force with effect from 27th December, 1985, Section 151A was inserted in the Customs Act, 1962. The said provision empowered the Board, if it considered it necessary or expedient so to do for the purpose of bringing uniformity in the classification of goods or with regard to the levy of duty thereon, to issue orders, instructions and directions to officers of customs as it might deem fit and such officers of customs and all other persons employed in the execution of the Customs Act were obliged to observe and follow such orders, instructions and directions of the Board. The Board Circular referred to above was issued prior to insertion of Section 151A in the Statute Book. For deciding this Appeal, it is not necessary for us to consider whether or not the said provision gives binding effect to even orders, instructions and directions of the Board issued prior to the change in law. For the reasons presently indicated, the view taken by the learned Single Judge about the meaning of the expression "alcohol of all sorts" appearing in Tariff Item 68 is correct and, therefore, the learned Single Judge has rightly granted refund of the additional duty paid on the consignment in question.

(3.) At this stage, we may indicate that the Assistant Collector of Customs had thrown out the Writ Petitioner's application for refund in limine on the ground of limitation. The learned Single Judge was plainly right in holding that in case the recovery of the additional duty was without the authority of law, no question of limitation could be pleaded to deprive the Petitioner of his right to obtain refund of the additional duty recovered without this authority. Before the learned Single Judge, the department itself did not pray for a remand and had preferred to contend that on merits the Writ Petitioner was not entitled to refund, inasmuch as the commodity imported by him was not alcohol of any sort. Mr. Bhabha, the learned Counsel for the Appellants, has submitted that the consignment of Pentaerythritol was not alcohol of any sort. The Board's Circular Letter dated 1st October, 1984 had no statutory force. The interpretation put by the Board upon Tariff Item 68 was not binding upon the Appellants. According to Mr. Bhabha, the decision of the Customs, Excise and Gold (Control) Appellate Tribunal dated 19th April, 1983 was also erroneous. Mr. Bhabha further submitted the according to trade or common parlance the article imported by the Writ Petitioner was not alcohol and the expression "alcohol" as given in Tariff Item 68 meant only Ethly Alcohol and not any other sort of alcohol. In this connection the learned Counsel for the Appellants placed reliance upon opinions and other materials produced on behalf of the Appellants before the learned Single Judge. According to the learned Counsel for the Appellants, no contrary evidence was adduced by the Petitioner who had relied solely upon the Board's Circular Letter dated 1st October, 1984 and the order of the Tribunal mentioned above. Therefore, the submission is that evidence given about the popular meaning of the expression "alcohol" in Tariff Item 68 ought to be accepted. According to Mr. Bhabha, neither the Board nor the Tribunal in expressing opinions about the scope of Tariff Item 68 had taken any notice of the trade or common parlance. In order to establish the meaning of the expression "alcohol" according to the common parlance, on behalf of the Appellants, strong reliance was placed on the affidavit of M.K. Ranganathan, Deputy Chief Chemist, Customs, Bombay, dated 16th December, 1986. The said deponent opined that the goods in question, viz. Pentaerythritol and other similar goods such as propylene glycol, trimethelen propyn, octanol, butanol, etc. fall within a common technical category, viz., chemical products. Further, ethly alcohol commonly referred to as alcohol and its products are materially different from such chemical products. According to the deponent Ranganathan, the term "alcohol" derived from "al" and "khol", the two Arabic words, when unqualified, has become specific for ethly alcohol spirits of wine rectified to the highest degree. Ethyl alcohol is well known as a constituent of alcoholic beverages. Reference has been made to Encyclopedia, Chemical Technology by Kirk Othmer, 3rd Edition. In paragraph 8 of his affidavit, Ranganathan, in support of the view that in the trade parlance "alcohol" is accepted to refer to ethyl alcohol, has relied upon certain authorities, viz. (1) Chemical Synonyms and Trade Names by William Gardener, (2) Merck Index, (3) Van Nastrend's Scientific Encyclopedia, 5th Edition (4) Condensed Chemical Dictionary, 10th Edition, (5) Chemical Trade Names and Commercial Synonyms by William Haynes, etc. The deponent proceeds to say that the said term "alcohol" unqualified and in singular refers to ethanol or ethyl alcohol. The qualification "all sorts" had to cover ammoniated spirit, rectified spirit, denatured spirit, absolute alcohol and alcohol of various dilutions and preparations. Before the learned Single Judge the present Appellants had produced price list effective from 1st March, 1986 of S.H. Kelkar & Co. Ltd., Lal Bahadur Shastri Marg, Bombay-400 080. In the said price list some of the items were described thus: "Benzyl Alcohol Extra"."Phenyl Athyl Alcohol Pure", "Phenyl Athyl Alcohol Extra". etc. But according to the terms and conditions of the said price list, "all the products mentioned in the list are free from alcohol". Mr. Bhabha tried to submit that the same indicated that mere use of the words "alcohol pure" or "alcohol extra" did not denote that/the particular article was an alcohol of a sort and that according to trade or common parlance, these goods were not termed as alcohol. On behalf of the Appellants, reliance was also placed upon two identical certificates granted by Dr. Gopal Kumar G. Nair who described himself as the Chairman of the Bulk Drug Committee of the Indian Drugs Manufactures' Association and also as the Director of the Bombay Drug House Pvt. Ltd. According to the said Dr. Gopal Kumar G. Nair, in the alcohol-based industry and trades only Ethyl Alcohol is known and referred to as alcohol. Other items like Glycol, Ethyline Glycol, Propylene Glycol, Isopropylene Alcohol, Propyl Alcohol, Methyl Alcohol, Isobutyl Alcohol, Butanol, etc., even though chemically referred to as alcohol because of the CH group in the chemical structure, in commercial parlance only Ethyl Alcohol is known as alcohol. Substantially the same view is expressed in the affidavit affirmed by S.P.S. Pundir, Deputy Collector of Customs, in reply dated 4th December, 1986. It is not necessary to set out the contents of the said affidavit..