PLASMAC MACHINE MANUFACTURING CO. PVT.LTD.versusCOLLECTOR OF CENTRAL EXCISE, BOMBAY.

      PLASMAC MACHINE MANUFACTURING CO. PVT.LTD.
A
                          v.
         COLLECTOR OF CENTRAL EXCISE, BOMBAY.

                             NOVEMBER 27, 1990

B                 [K. N. SAIKIA AND R.M. SAHA!, JJ.]

          Central Excises and Salt Act, 1944--Section 3 and First Schedule
    Jtems Nos. 52 and 68-Tie Bar Nuts-Assessability to duty.

           The appellant are the manufacturers of Injection Moulding
    Machines and their 19 types of parts, one of which is called 'Tie Bar
c   Nuts' which are stated to be used to fix the platens in correst distances      •
    in between tie bars. The appellants submitted their classification lists
    for the year 1981-82 and listed the machines as also the Tie Bar Nuts
    under Tariff item No. 68. The Superintendent, Central Excise, by his
    letter dated 20.10.81 forwarded the classification list and directed the
D   appellants to file a separate classification list for the Tie Bar Nuts under
    tariff item No. 52, take out licence for the same and also to furnish value
    and clearance of Tie Bar nuts for the year 1980-81 and 1981-82.
    Aggrieved the appellants appealed to the Collector of Central Excise
    (Appeal) Bombay, who, while allowing the appeal, ordered that Tie Bar
     Nuts be classified under Tariff Item No. 68. He took the view that the
E   nuts in question were not available in the market and were designed for
    a particular purpose for Injection Moulding Machines and could not be
    used for any other purpose. Thereupon the~Department preferred
    appeal to the Central Custom. Excise and Gold Control Tribunal, New
     Delhi and contended before the Tribunal that the sample of the product
    showed that it was a plain nut and no special features were apparent
F   and the main function of the Tie Bar Nuts was to fasten. The Tribunal
     allowed the appeal holding that the Tie Bar Nuts would merit classifica-
    tion under Tariff Item No. 52. The appellants have thus filed this appeal
     under section 35L of the Central Excise and Salt Act, 1944.

          Dismissing the appeal, this Court,
G
          HELD: If according to law Tie Bar Nuts fall within tariff Item 52,
    the fact that department earlier approved their classification under
    tariff item 68 will not estop it from revising that classification to one
    under item 52. There could be no estoppel against a statute. [387F-G]

H         If an article is classifiable under a specific item, it would be

                                        384
         PLASMAC MACHINE MFG. CO. v. C.C.E. [SAIKIA, J.l             385

ag11lnst the very prindple of classification to deny it the proper
percentage and consign it to the residuary item. [391D I                    A

      There Is no dispute that T~ Bar Nuts conform to Ute popular idea
of nuts. (39Qa)
       The 'Tie Bar Nuts' function of fixing the platens as stated by the   B
appellants and that of factening, as argued by them, are not basically
different, ancl the appellants themselves having called the goocls as
'nuts' we are of the view that the Tribunal is correct in classifying Tie
B11r Nuts uncler Tariff Item 52. There is therefore, no reason to
interfere with the department's order and no justification for classify-
ing tbllSe In the residuary item 68. [391C)
                                                                            c
      M/s. Elson Machines Pvt. Ltd. v. Collector of Central Excise,
( 1989] Suppl. 1 SCC 671: Bhor Industries Ltd., Bombay v. Collector of
Central Excise, Bombay, [1989) 1 SCC 602; M/s. Ujagar Prints and
Ors. v. Union of India and Ors., [1989) 3 SCC 488; Simonds Marshal
Ltd. v. M.R. Baralikar, Assistant Collector of Central Excise, Pune,        D
(19116] 22 ELT 378; Indo International Industries v. Commissioner of
Sales Tax, U.P., [1981) 3 SCR 294; Dunlop India Ltd. v. Union of
India, [1976) 2 SCC 241; Atul Glass Industries (Pvt.) Ltd. v. Collector
of Central Excise, [1986) 3 SCC 480; Indian Aluminium Cables Ltd. v.
Union of India, [1985) 3 SCC 284 and M/s. Asian Paints India Ltd. v.
Collector of Central Excise, [1988] 2 SCC 470, Referred to.                 E

    CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1036
(NM) of 1990.

     From the Order dated 8.8. 1989 of the Customs Excise and Gold
(Control) Appellate Tribunal, New Delhi in Appeal E/A. No. 845 of           F
1984-0. (Order No. 241/89-D.


     J.F. Pochkanawalla, Raian Karanjawala, Manish Karanjawala.
Mrs. Nandini Gore and Mrs. Manik Karanbjawala for the apppellants.

                                                                            G
      N.S. Hegde, Additional Solicitor General and A .. Subba Rao for
the respondent.

      The Judgment of the Court was delivered by

      K.N .SAIKIA,     J. The appellants Mis Plasmac Machine                H
    386          SUPREME COURT REPORTS                [1990] Supp. 3 S.C.R

    Manufacturing Co. Pvt. Ltd .• Bombay are manufacturers of Injection
A
    Moulding Machines of four categories and the same were classified
    under tariff Item No. 68. For these machines they manufacture
    approximately 19 parts, one of which is called 'Tie Bar Nuts .. which
    are the subject matter of this appeal. The Tie Bar Nuts are
    manufactured from 2 3/4 .. hexagonal M.S. Bar having.special threads
B   known as 'acme threads'. The Tie Bar Nuts are stated to be compo-
    nents of Injection Moulding Machines (tailormade) and are used to fix
    the platens in correct distances in between tie bars.

           The appellants submitted their classification list for the year
    1981-82 for .84 gms., and 56 gms., and 70 gms., semi-automatic and
    fully automatic '"plasmac" Injection Moulding Machines under tariff
c   Item 68 alongwith enclosure of 19 parts manufactured and used in the
    said machines. In these 19 parts Tie Bar Nuts were shown against Srl.
    No. 15. However, the Assistant Collector of Central Excise classified
    and approved the said Tie Bar Nuts under tariff Item 52 and not under
    68. The Superintendent, Central Excise, Range-I vide his letter dated
D   cO. JO. 198 I forwarded the classification list and directed the appellants
    to file a separate classification list for the Tie Bar Nuts under tariff      •
    I tern 52 and take out licence for the same and also to furnish value and     l
    clearance of Tie Bar Nuts for the year 1980-81 and 198 J-82. Aggrieved
    at this classification the appellants appealed to the Collector of Central
    Excise (Appeal) Bombay who, while allowing the appeal, ordered that
E   Tie Bar Nuts be classified under tariff Item 68 on the ground that Tie
    Bar Nuts were not available in the market and were designed for a
    particular purpose i.e. for Injection Moulding Machines, and those
    could not be used for any other purpose. The department appealed
    therefrom to the Central Custom. Excise and Gold Control Appellate
    Tribunal. New Delhi. Before the Tribunal the department, inter alia,
F   contended that the sample of the product showed that it was a plain
    nut and no special features were apparent, and that the main function
    of the Tie Bar Nuts would be of fastening, and other functions, if any.
    would be secondary. It was contended by the appellants that the Tie
    Bar Nuts were used in course of the continuous process of manufacture
    of the machines and formed its integral part, being specifically made
G   for use in the machines; and that Tie Bar Nuts were neither available
    nor saleable in the market, their only function being to fix the platens
    in correct distances between Tie Bars.

          The Appellate Tribunal held that from the evidence on record it
    is found that according to the appellants themselves the Tie Bar Nuts
H · in question have the function of fastening for the machine and. there-
          PLASMAC MACHINE MFG. CO. v. C.C.E. ISAIKIA, J.l              387

fore. the contention that the main function of Tie Bar Nuts is not to
fasten any part but to adjust the distance between two platens does not
                                                                               A
change the complex of the case, and that there is no doubt that the Tie
Bar Nuts would merit Classification under tariff item 52. The depart-
menfs appeal having thus been allowed by the Appellate Tribunal, the
appellants have preferred this appeal under section 35L of the Central
Excise and salt Act, 1944, hereinafter referred to as "the Act".               B

      Mr. Puchkanimal, the learned counsel for the appellants sub-
mits. inter alia, that the appellants have since long been classifying Tie
Bar Nuts under tariff item 68 without objection from the department
and there is no justification for the department to change that classifi-
cation: that the Tribunal's finding that on the appellants' own showing
that Tie Bar Nuts performed the function of fastening was wrong; and           c
that the Tie Bar Nuts produced by the appellants to specifications
required for captive use in the Injection Moulding Machines and not
for sale in the market could not be classified under tariff Item 52.

      Mr. Santosh Hegde, the learned Addi. Solicitor General, refer-           D
ring to the meaning of 'fasten' in the Webster's Third New Interna-
tional Dictionary submits that the appellants themselves having stated
that the function of the Tie Bar Nuts is to 'fix' the platens in correct
distance between Tie Bars, in their letter dated October 22, 1981 to
the Superintendent. Central Excise, Range-I, they have in effect
admitted that the Tie Bar Nuts performed the function of 'fastening',          E
which also includes 'fixing', and that the Tribunal was. therefore, right
in classifying those under tariff Item 52 allowing the revision in classifi-
cation. We may now examine these contentions.

       The appellants contention that the department having earlier
approved the classification of Tie Bar Nuts under tariff item 68 has no        F
justification for its revision is. to our mind, not tenable inasmuch as
there could be no estoppel against a statute. If according to law Tie
Bar Nuts fall within tariff Item 52 the fact that the department earlier
approved their classification under tariff Item 58 will not es top it from
revising that classification to one under tariff Item 52. See Mis. Elson
Machines Pvt. Ltd. v. Collector of Central Excise, [1989] Suppl. I SCC         G
671. para JO at 675.

      The submission that the Tie Bar Nuts manufactured by the
appellants to specifications of Injection Moulding Machines 'for cap-
tive use and not for sale is also, in our view, untenable, as such use is
not determinative of the question. If the goods are capable of being           H
    388         SUPREME COURT REPORTS                 [ 1990] Supp. 3 S.C.R.

    sold that would be enough. In Bhor Industries Ltd. Bombay v. Col-
A   /ecwr oj Cenrra/ Excise, Bombay, [1989] I SCC 602 the crude PVC
    tilm' as produced by the appellants were not known in the market nor
    rnuld they be sold in the market. Sabyasachi Mukharji, J., as he then
    wa,. while considering the submission that it was only the goods as
    'pecified in the schedule to the Act that could be subjected to the duty
B   in para 6 observed:

                "For articles to be goods these must be known in (he
                market as such or these must be capable of being sold in the
                market as goods. Actual sale in the market is not neces-
                sary. user in the captive consumption is not determinative
                but the articles must be capable of being sold in the
c               market or known in the market as goods. That was
                necessary."

    The appellants themselves have called the goods 'Tie Bar Nuts' and
    those are admittedly used for fixing plateus at appropriate distances. It
D   cannot be said that the Tie Bar Nuts after their manufacture did not
    constitute goods; their actual sale in the market was not necessary.

          In Mis. Ujagar Prims and Ors. v. Union of India and Ors., [1989]
    3 sec 488 it has been held that excise duty is levied on manufacture
    and production of goods and the liability to pay such duty is not depen-
E   dent on whether the manufacturer is the owner or not. The question
    whether the producer or the manufacturer is or is not the owner of
    goods is not determinative of the liability.

          Mr. Puchkanimal has emphasised that fastening has not been the
    function of Tie Bar Nuts manufactur.ed by the appellants and used in
f   their Injection Moulding Machines, and so those would not fall under
    Tariff Item 52.

          Tariff Item 52 at the relevant time said:

                "52. Bolts and nuts, threaded or tapped and screws, of base
G               metal or alloys thereof, in or in relation to the manufacture
                of which any process is ordinarily carried on with the aid of
                power.

                Explanation: The expression "Bolts and nuts, threaded or
                tapped and screws" used in this item shall include bolt
H               ends, screw studs, screw studding, self-tapped screws,
           PLASMAC MACHINE MFG. CO. v. C.C.E. [SAIKIA, J.)              389

            screw hooks and screw rings."
                                                                               A
it has not been denied that the Tie Bar Nuts are of base metal or alloys
manufactured with the aid of power and are acme-threaded. From the
language in Item 52, it would appear that fastening in the strict sense
may not be the only function of nuts. Fixing may also be a kind of
fastening .. In Simmonds Marshal Ltd. v. M.R. Baralikar, Asstt. Col-           B
/ector of Central Excise, Pune, [1985] 22 ELT 378 the Bombay High
Court held that 'nyloc selt' locking nut', is a kind of nut and is classifi·
able under Item 52.

      'Fasten', according to Webster's Third New International Dictio-
nary, means "2a: to cause to hold to something else; attach especially ·
by pinning, tying, or nailing; b; to cause (parts which are separate) to C
hold together; make fast arid secure; c: to fix firmly or securely i.n
position." 'Fix', according to the same dictionary, means "la(I): to
make (a material object) firm, stable, or stationary; make fast (a post
in the ground); c(l): fasten, attach, affix." 'Nut' according to the same
dictionary means "3: a perforated block that is usually a small piece of D
metai of square or hexagonal section, that has an internal screw
thread; and that is used on a bolt or screw for tightening or holding
something or for transmitting motion." 'Fasten' according to the Shor·
ter Oxford English Dictionary means" l. to make fast; to make firm or
stable; to confirm; 4. to make fast to something else; to attach by a tie
or bond." 'i'ix' according to the same dictionary means "1. l. to fasten, E
make firm or stable; to set or place and secure against displacement."
'Nut' according to the same dictionary means "11.3.a. small block of
wood, iton, etc., pierced, and wormed with a female screw; used to
make a bolt fast or adjust it."

       'Fasten' according to Collins English Dictionary means "l. to           F
make or become fast or secure; 2. to make or become attached or
joined; 3. to close or become closed by fixing firmly in place, locking
etc.'' 'Fix' according to the same dictionary means "l. to make or
become firm, stable or secure; 2. to attach or place perrf)anently."

      According to webster Comprehensive Dictionary International              G
Edition 'i'asten' means to attach or secure to something else; connect:
to make fast; secure. 'Fix' according to the same dictionary means" 1.
to make firm or secure; attach securely; fasten, 17. to become firm or
fixed". 'Nut' according to Collins English Dictionary means "9. a
small metallic block, usually hexagonal or square with an internal
screw thread enabling it to be fitted onto a bolt." According to the           H
    390         SUPREME COURT REPORTS                 (1990] Supp. 3 S.C.R.

A   Webster Comprehensive Dictionary International Edition 'nut' means
    "2. a_small block of metal having an internal screw thread so that it may
     be fitted upon a bolt, screw, or the like."

          We are conscious of the limited use of dictionary meaning in
    classification of goods for tariff Items. We are using it in this case for
B   the meaning of 'fasten' and 'fix' and not for the meaning of 'nuts'.
    From the above shades of meaning, we do not find such difference
    between the functions of 'fastening' and 'fixing' in respect of a 'nut', so
    as to justify classification of Tie Bar Nuts differently from other nuts
    on the basis of its function.

          The submission that 'nuts' in entry 52 are to be understood in the
c   commercial sense is not disputed by the department. It is an accepted
    principle of classification that the goods should be classified according
    to their popular meaning or as they are understood in their commercial
    sense and not as per the scientific or technical meaning. Indo Interna-
    tional Industries v. Commissioner of Sales Tax, U.P., (1981] 3 SCR 294
D and Dunlop India Ltd. v. Union of India, (1976] 2 SCC 241 have
    settled this proposition. How is the product identified by the class or
    section of people dealing with or using the product is also a test when
  I the statute itself does not contain any definition and commercial par-
  1 lance would assume importance when the goods are marketable as was

    held in Atul Glass Industries (Pvt.) Ltd. v. Collector of Central Excise,
E (1986] 3 SCC 480 and Indian Aluminium Cables Ltd. v. Union of India,
    (1985] 3 SCC 284. In M/s. Asian Paints India Ltd. v. Col/etorof Central
    Excise, [ 1988] 2 SCC 470 which was a case of Emulsion paint, at para 8
    it was said:

                "It is well settled that the commercial meaning has to be
F               given to the expressions in tariff items. Where definition of
                a word has not been given, it must be construed .in its
                popular sense. Popular sense means that sense which
                people conversant with the subject-matter with which the
                statute is dealing, would attribute to it."

G        CIT v. M/s. Taj Mahal Hotel, (1972] 1 SCR 168: [1971] 3 SCC
    550 was applied.

          In the instant case there is no dispute that Tie Bar Nuts conform
    to the popular idea of nuts. In Indo International Industries. v. Com-
    missioner of Sales Tax, (supra) this Court observed that in interpreting
H   items in statutes like the Excise Act or Salex Tax Act, whose primary
          PLASMAC MACHINE MFG. CO. v. C.C.E. [SAIKIA, J.J            391

object was to raise revenue and for which purpose to classify diverse       A
products, artiCles and substances, resort should be had not to the
scientific and technical meaning of the terms .or expressions used but to
their popular meaning, that is to say, the meaning attached to them by
those dealing in them. The fact that in the instant case the learned
Technical Member of the Tribunal held in dissent that the Tie Bar
Nuts are not fastening nuts would therefore be of no avail to the           B
appellant.

       Applying the foregoing principles and considering the fact that
the Tie Bar Nuts' function of fixing the platens as stated by the appel-
lants and that of fastening, as argued by them, are not basically diffe-
rent, and the appellants themselves having called the goods as 'nuts', c
we are of the view that the Tribunal is correct in classifying Tie Bar
Nuts under tariff Item 52. We, therefore, do not find any reason to
interfere with the department's prospective modification of the clas-
sification. We find no justification for classifying those in the residuary ·
Item 68. As was held in Dunlop India Ltd. v. Union of India, (supra) if
an article is classifiable under a specific item, it would be against the D
very principle of classification to deny it the proper parentage and
consign it to the residuary item.

     This appeal accordingly fails and is dismissed, but without any
order as to costs.

Y.Lal                                                 Appeal dismissed.