Customs, Excise and Gold Tribunal - Delhi
Wood Craft Products Ltd. vs Collector Of Central Excise on 18 October, 1989
Equivalent citations: 1992(60)ELT668(TRI-DEL)
ORDER
G. Sankaran, Senior Vice-President
1. All these appeals involve a common issue. They were, therefore, heard together and are disposed of by this common order.
2. The issue is whether Block Board, manufactured by the appellants, were classifiable under Heading No. 4410.90 of the Schedule to the Central Excise Tariff Act, 1985, as claimed by the appellants or under Heading No. 4408.90 as held by the lower authorities. In opting for the latter classification, the Collector (Appeals) has relied on the explanatory notes appearing under Heading No. 44.12 (according to the Collector this heading corresponded to Heading No. 44.08 of the Indian Tariff Schedule) of the H.S.N. (Harmonised System of Nomenclature) of the Customs Co-operation Council (C.C.C.N.).
3. We have heard Shri S.K. Bagaria, Counsel for the appellants and Shri L.C. Chakravorty, DR, for the respondent-Collector.
4. The two competing headings are reproduced below :-
"44.10 Articles of wood not elsewhere specified 4410.10 - Flush Doors 4410.90 - Other"
"44.08 Plywood Veneered panels and similar laminated wood 4408.10 - Marine plywood and aircraft plywood 4408.20 - Plywood for tea-chests when cut to size in panels or shooks and packed in sets 4408.30 - Decorative plywood 4408.40 - Cuttings and trimmings of plywood of width not ex-
ceeding 5 centimetres
4408.90 - Other"
It may be seen that Block Board has not been specified, in terms in the two entries. The Department's contention is that it is covered by the phrase "similar laminated wood" in Heading 4408.90 while the appellants' contention is that it is not similar to laminated wood and falls under the residual Heading "Other" 4410.90.
5. There is no definition of Block Board or Laminated Wood in the tariff. Therefore, the expressions must, in accordance with the well-settled law in this behalf, be construed in their popular sense as understood by people dealing in the goods [see Supreme Court's judgments in Asian Paints (India) Ltd. v. Collector of Central Excise -1988 (35) E.L.T. 3, Collector of Customs v. Bhor Industries Ltd. -1988 (35) E.L.T. 346 and in Geep Flash Light Industries Ltd. v. Union of India -1985 (22) E.L.T. 3 and several other cases]. One of the methods for ascertaining the popular sense would be to adduce evidence in this behalf from people in commerce and industry dealing in goods in question. Another would be to consider the definitions, if any, given to the terms under consideration in the Glossaries of Terms published by the Indian Standards Institution. This method has been viewed with approval by the Supreme Court - See Collector of Central Excise v. Krishna Carbon Paper Co. -1988 (37) E.L.T 480 and Union of India v. Delhi Cloth and General Mills Co. Ltd. -1977 (1) E.L.T. (J 199).
6. The appellants have submitted certain certificate from dealers in plywood and other wood products to evidence the commercial understanding of the term "Block board" - annexures Cl to C5 to the memo of appeal. But, as rightly pointed out by the learned DR, it is not evident from the record that these documents had been placed before the Collector (Appeals). Nor have any steps been taken by the appellants to seek leave of the Tribunal to have these documents admitted as additional evidence. When these circumstances were put to the learned counsel for the appellants, he stated that these documents might be ignored and that he would not be referring to them.
7. We are thus left with the need to refer to the Indian Standards Institute publications for guidance. Shri Bagaria has drawn our attention to IS 707-1976 entitled "Indian Standard - Glossary of Terms Applicable to Timber Technology and Utilization" (Second Edition). This standard has been drawn up by the Timber Sectional Committee of the I.S.I, consisting of representatives of user-departments, like the Railways, of State Forest Departments, Indian Plywood Industries Research Institute, and Federation of Indian Plywood & Panel Industry among others. Thus, the standard is truly an authentic reflection of the Industry & Trade's understanding of the terms listed therein. The Standard has the following definitions :-
"Laminated wood - An assembled product made up of layers of wood and adhesive in which-the grains of adjacent layers are parallel".
"Block Board - A board having a core made up of strips of wood, each not exceeding 25 mm in width, laid separately or glued or otherwise joined to form a slab which is glued between two or more outer veneers with the direction of the grain of the core blocks running at right angles to that of the adjacent outer veneers (See Fig.).
8. As pointed out by Shri Bagaria, it may be seen from the two definitions that he two terms signify different articles. Whereas laminated wood is made up of layers of wood and adhesive in which the grains of adjacent layers are parallel, block board has a core made up of strips of wood (each not exceeding 25 mm in width). The strips, as may be seen from the accompanying diagram in the I.S. are not laid out in layers. They are aid separately and joined together by glue or otherwise to form a slab. This slab is placed between two or more outer veneers with the direction of the grain of the core blocks running at right angles to that of the adjacent outer veneers. Thus, the two types of wood differ from each other in material respects. Nor is block board similar to "plywood" which, according to the same I.S. is a "A board formed of three or more layers of veneer cemented or glued together, usually with the grain of adjacent veneers running at right angles to each other", a "Veneer being a thin sheet of wood of uniform thickness obtained by slicing, rotary cutting or sawing".
9. Having regard to the above considerations, it is Shri Bagaria's submission that block board is not similar to plywood nor laminated wood. The word "similar" in Heading No. 44.08 implies and signifies according to Shri Bagaria, corresponding, resembling in many respects, somewhat alike, having a general likeness. This was the view taken by this Tribunal in Collector of Central Excise v. Nat Steel Equipment Pvt. Ltd. -1987 (31) E.L.T. 951. This decision was upheld in appeal by the Supreme Court by its judgment reported in 1988 (34) E.L. T. 8.
10. The DR's reply to the above contention is that the words "similar laminated wood" constitute a generic term and would include any glued or laminated wood. And, he relies on the explanatory notes to Heading No. 44.12 of the H.S.N. in this behalf.
11. We note that the aforesaid Heading 44.12 of the H.S.N. reads exactly the same way as Heading No. 44.08 of the Indian Tariff Schedule.
"Plywood, veneered panels and similar laminated wood".
The Indian Tariff Schedule is based on the H.S.N. and to this extent, the explanatory notes on the H.S.N. are, though not of a legally binding nature, of persuasive value. These notes say :-
"Similar laminated wood. This group can be divided into two categories : Block board, lamin board and batten board, in which the core is thick and composed of blocks, laths or battens of wood glued together and surfaced with the outer plies. Panels of this kind are very rigid and strong and can be used without framing or backing." The Department therefore, contends that block board is covered by the phrase "similar laminated woods" in Heading No. 44.08. Though the submission looks attractive, it has to be remembered that the entries in the Central Excise Tariff Schedule have to be interpreted in the light of the words employed therein, read with the relevant statutory chapter notes and section notes, if any, and the rules of interpretation if they have to be invoked in the given facts and circumstances."
12. We have already extracted the meanings of the expressions "plywood", "veneer" and "laminated wood". Of these, the most relevant definition, for the present purpose, is that of "laminated wood". According to this definition, laminated wood is an assembled product made up of layers of wood and adhesive in which the grains of adjacent layers are parallel. We have also noted the definition of "Block Board". Block Board we have already seen, does not conform to this definition of laminated wood, the two important differences being in its core structure and the direction of the grains vis-a-vis the outer veneers.
13. An indication, though an indirect one, of the clue to the problem can be had by perusal of Central Excise Notification No. 55/79 dated 1-3-1979. This notification fixed concessional rate of duty on the types of wood specified therein, one of the types being "batten boards" and "block boards (including flush doors)" having both faces of commercial plywood and veneered shooks and panels made of strips of wood glued between two outer veneers. This notification which lumped block boards and flush doors together continued to be in force even after the introduction of the Tariff Schedule of 1985 till it was rescinded on 1-3-1987 by Notification No. 88/87. If block boards are of the same or similar genre as flush doors, then, the more appropriate classification would appear to be under Heading No. 44.10 which specifies flush doors as a separate category and other articles of wood not elsewhere specified, to a residual sub-heading 4410.90.
14. The definitions in the Indian Standards Glossary go to support the appellants' contention. The Department has not adduced any evidence to show that block board is known in the trade as laminated wood similar to plywood and veneered panels. The onus to show that this is so is on the Department and this onus has not been discharged.
15. In the state of the evidence available, we have to hold that block board does not fall within Heading No. 44.08, sub-heading 4408.90. The more appropriate classification would be under Heading 44.10, sub-heading 4410.90. In this view of the matter, the anneals succeed and are. also allowed.