Customs, Excise and Gold Tribunal - Delhi
Shashwat Printers (P) Ltd. vs Collector Of Customs on 23 October, 1992
Equivalent citations: 1993ECR438(TRI.-DELHI), 1993(65)ELT641(TRI-DEL)
ORDER N.K. Bajpai, Member (T)
1. This appeal has been filed against the orders of the Collector of Customs (Appeals), Calcutta upholding the orders of the Assistant Collector of Customs, for Appraising Group 2, Custom House, Calcutta denying the benefit of exemption from duty on Graphic Art Films imported by the appellants under Notification 103/89-Cus., dated 1-3-1989 on the ground that the appellants are not registered with the Registrar of Newspapers for India.
2. The appellants have assailed the orders on the ground that the ownership of the Patna edition of the newspaper 'AJ' was transferred in the name of the appellants and this fact was communicated to the Registrar of Newspapers for India by a letter, dated 3-10-1983. Since the goods imported in the subject consignment are meant for the Patna unit of 'AJ' of which M/s Shashwat Printers are the proprietors, the same are entitled to exemption under Notification 103/89-Cus., dated 1-3-1989 and they should be held to be a 'newspaper establishment' duly registered with the Registrar of Newspapers for India on the basis of documents produced with the appeal.
3. In the Cross Objections filed by the respondents the claim has been contested on the ground that the fact of transfer of ownership had not been mentioned in the Registration Certificate issued by the Registrar of Newspapers; the appellants who had imported the goods were only printers and publishers and could not be considered as a 'Newspaper Establishment' for purposes of the exemption notification.
4. An application for producing additional evidence was moved by the appellants under Rule 23 of the CEGAT (Procedure) Rules, 1982. The evidence consisted mainly of documents to support the ground in the appeal that the ownership of the Patna Unit of the newspaper 'AJ' had been transferred to the appellants in July 1982 and the appellants are also the printers and publishers of the newspaper of the Patna Unit. This application was allowed by the Tribunal on 29-10-1991.
5. Subsequently, the learned SDR also moved an application for submitting two letters in rebuttal of the additional evidence allowed to be produced by the appellants. After hearing both sides, we have, by a separate order allowed these letters to be taken on record before the hearing of the appeal was taken up.
6. Shri L.P. Asthana, the learned Counsel for the appellants submitted that he did not understand the purpose of filing of the Cross Objections by the respondents since the impugned order was fully in their favour. Arguing on the appeal he submitted that although the appellants were printers and publishers of the newspaper at Patna, Ranchi and Jamshedpur, in view of the fact that many of the documents filed by the appellants were not legible and English translations of some of them were not provided, they were confining their arguments in the appeal only so far as the Ranchi Unit was concerned.
7. Referring to Notification No. 103/89-Cus., dated 1-3-1989, Shri Asthana stated that the authorities had held that the appellants could not be regarded as a 'newspaper establishment' in terms of the notification and were only printers and publishers of the Hindi daily 'AJ' published from Patna, Ranchi and Jamshedpur. He took us through the provisions of the Press and Registration of Books Act, 1867 specially Sections 3, 5, 6, 7, 19B and 19C and submitted that under Section 5 it was the printer and publisher of the newspaper who had to make and subscribe a declaration in respect of the newspaper printed and published by him before a Magistrate and, based on this declaration, the Registrar of Newspapers issued a Certificate of Registration in respect of the newspaper to the publisher. Thus, it was the printer and publisher who was the one concerned under the Act Since the Certificate of Registration was issued to him and not to the owner under Section 19C. He read out from the Declaration made under Section 5 in which it was specifically mentioned that although the title of the newspaper was owned by M/s Jnan Mandal Ltd. it was managed by M/s Shashwat Printers. He also read out from the Certificate of Registration (No. 44305/85, dated 18-11-1985) issued by the Registrar or Newspapers to Hindi daily 'A]' published from Ranchi and invited attention to columns (6) and (7) in which the name of the appellants finds specific mention both as printers and publishers of the newspaper. He also read from the Assessment Order of the Deputy Commissioner of Income-Tax, Special Range, Varanasi for the year 1989-90 in respect of the appellants' company and explained that the Profit & Loss Account showed the income from the circulation of the newspaper as well as the expenditure on account of salaries to the Directors and employees. In view of these submissions, Shri Asthana stated that the finding of Collector (Appeals) that there was no evidence to show that all the expenses relating to the newspaper-salary of the editor, sub-editor, reporter and other connected staff working for the newspaper are entirely borne by the appellants was not correct. Since the Profit and Loss Account contains the details of such expenditure and also the circulation income, there could be no doubt that it was the appellants who were running the newspaper establishment and were entitled to the exemption in that capacity. He also submitted that in a case like this, the only newspaper establishment which can be registered with the Registrar of Newspapers is the printer and publisher and not the owner simplicitor even when the two were different.
8. Smt. Ananya Ray, the learned SDR referred to ground No. 4 of the Grounds of Appeal in which there was specific mention that the goods had been imported for the Patna Unit of the appellants. She, therefore, contested the claim of Shri Asthana that the subject goods had been imported for the Ranchi Unit of the newspaper. She submitted that while the goods are actually to be used at Patna, the documents on which Shri Asthana is arguing the appeal relate to the Ranchi Unit.
9. Referring to the preamble of the Press & Registration Act, Smt. Ray stated that what was done under the Act was the registration of newspapers and not of printers and publishers or of newspaper establishments. In particular she referred to Rule 2B below Section 5 which was as under :-
"(2B) Where the printer or publisher of a newspaper making a declaration under Rule 2 is not the owner thereof, the declaration shall specify the name of the owner and shall also be accompanied by an authority in writing from the owner authorising such person to make and subscribe such declaration."
10. Smt. Ray submitted that it was thus clear that, contrary to the submissions of Shri Asthana, the Act did not accept the printer and publisher as the only persons concerned; as they had to act under a specific authority from the owner for making the declaration which formed the basis for the issue of the Registration Certificate under Section 19C. She also cited the definition of the word "establishment" from Longman Dictionary of the English Language (1984 Reprint) which meant "controlling group of the stated type". In view of these submissions, she stated that the 'newspaper establishment would really be M/s Jnanmandal, the owners of the newspaper 'AJ' and not M/s Shashwat Printers. The import being by the appellants, they were not entitled to the exemption under the notification.
11. Replying, Shri Asthana submitted that it is not correct to say that they had claimed the exemption only for the Patna Unit and not for the Ranchi Unit. M/s. Shashwat Printers were the printers and publishers for both the units and he was not pressing the claim for the Patna Unit because the appellants had not filed legible copies of documents. He had stated this fact at the very outset.
12. Inviting attention to the provisions of Rule 2B under Section 5 of the PRB Act which stipulated an authority to be furnished from the owner in those cases in which the printer or publisher making the declaration is not the owner, Shri Asthana submitted that the importance of the printer and publisher was evident since the declaration had still to be given by them and not by the owner.
13. We have carefully considered the appeal, the submissions made at the hearing and have perused the records. It would be useful to reproduce the Notification for a proper appreciation of the point in dispute.
"Chapter Photographic and 37.10
37 cinematographic goods
Effective rate of duty for specified inputs for the newspaper industry. -In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the goods specified in the Table hereto annexed, when imported into India, by a newspaper establishment registered with the Registrar of Newspapers for India, appointed under Section 19A of the Press and Registration of Books Act, 1867 (25 of 1867) from so much of that portion of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as is in excess of the amount calculated at the rate of 35% ad valorem TABLE
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Sl. No. Description of goods
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(1) (2)
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1. Graphic art films falling under Chapter 37.
2. Offset printing plates (presensitised) falling under Chapter 37.
3. Stereo flongs falling under Chapter 48
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[Notification No. 103/89-Cus., dt. 1-3-1989]"
14. It is seen from the above that in order to avail of the exemption under this notification, (a) the goods should be imported by a newspaper establishment and (b) the newspaper establishment should be registered with the Registrar of Newspapers for India.
15. We have seen that Section 19C of the Press & Registration of Books Act, provides for the issue of a Certificate of Registration in respect of a newspaper to the publisher thereof. The Registration Certificate for the Ranchi Unit which has been filed before us is as under :-
"GOVERNMENT OF INDIA OFFICE OF THE REGISTRAR OF NEWSPAPERS FOR INDIA CERTIFICATE OF REGISTRATION This is to certify that the newspaper entitled AJ has been registered under the Press and Registration-of Books Act, 1867.
1. Title of the Newspaper AJ
2. Registration Number of the Newspaper Registration No. 44305/85
3. Language/ Languages in which it is Hindi published
4. Periodicity of its publication and the Daily day/days/dates on which it is published 5 Retail selling price of the newspaper 0.60 Paise
6. Publishers's Name Shri Beni Madhab Chatterji Nationality Indian Address Shashwat Printers Pvt.
Ltd., Main Road,
Ranchi.
7. Printer's Name Shri Beni Madhab
Chatterji
Nationality Indian
Address Shashwat Printers Pvt.
Ltd., Main Road,
Ranchi.
8. Editor's Name Shri Shardul Vikram
Gupta
Nationality Indian
Address Shashwat Printers Pvt.
Ltd., Main Road,
Ranchi
9. True and precise account of the premises Shashwat Printers Pvt.
where printing is conducted Ltd., Main Road,
Ranchi.
10. Place of publication Shashwat Printers Pvt.
Ltd., Main Road,
Ranchi.
Date : 18-11-1985 /Sd-/
REGISTRAR OF NEWSPAPERS FOR INDIA".
16. Thus, what is registered under the Act is the newspaper although the names, nationality and addresses of the publisher, printer and editor are also incorporated in the certificate. In fact, this appears to have been done in pursuance of Section 19B of the Act. There is no dispute that the Ranchi edition of newspaper 'AT' is registered with the Registrar of Newspapers. In the Certificate of Registration, the name of Shri Beni Madhab Chatterji along with the name of M/s. Shashwat Printers (Pvt) Ltd. - the appellants before us - is indicated as the address of the printer and the publisher. Even in Column (9) and (10) of the Certificate as the premises where printing is done and the place of publication, the name of the appellants is shown. In the declaration made under Section 5 too, the name of Shri Beni Madhab Chatterji is shown as the printer and publisher of 'AJ' to be printed at Shashwat Printers Pvt. Ltd. Ranchi and published by Shashwat Printers Pvt. Ltd, Ranchi.
17. A careful reading of the provisions of the PRB Act will show that although the registration is of the newspaper, it is intimately connected with the printer and publisher and among the particulars essential for registration of the newspaper are the names, nationality and address of the printer and the publisher. The connection is so intimate that under Rule 4 it is necessary for the printer and the publisher to make a new declaration as often as they leave India for more than 90 days, of where the printer and the publisher is by infirmity or otherwise rendered incapable of carrying out his duties exceeding 90 days. Such being the recognition of the role of the printer and the publisher in the PRB Act, can it be said that the printer and the publisher of a newspaper which is registered under the Act, is not a part of the newspaper establishment? One cannot think of a newspaper without a printing press and arrangements for its publication (which would naturally include circulation). Would it then be correct to say that if the printer and publisher are not also the owner of the newspaper, they do not constitute the 'newspaper establishment' and even though the notification gives exemption from duty to a 'newspaper establishment' registered under the PRB Act, the exemption would be confined only to those cases in which the owner himself is the printer and the publisher? For an answer to this question it would be necessary to examine the meaning of the word 'establishment'. The meaning as available in various dictionaries is as under :-
Establishment:
(a) Concise Oxford Dictionary: Organized body of men maintained for a purpose, as army, navy, civil service.
(b) Webster's Dictionary: A place of business or residence and everything connected with it.
(c) Longman Dictionary of Contemporary English (1984 Reprint): (i) A group of people that form a business organization (ii) The powerful organizations and people who are said to control public life and support the established order of Society.
18. It is clear from the above that an establishment is composed of a body of men engaged for a common purpose like the army, navy, the civil service or a family establishment or a business establishment. The newspaper establishment would, therefore, connote the activity connected with the ultimate object of bringing out a newspaper. Such an establishment would, in terms of the definition particularly given in Webster's Dictionary, cover all activities from news gathering, editorial functions of putting the news together and editing it to the printing of the newspaper in a printing press and its publication for final circulation. It involves basically (a) the owner of the newspaper who sets up the establishment and includes (b) the editor, news reporters and correspondents (c) the printing press and (d) the publisher. Unless each of these work together as part of a common establishment, the newspaper cannot be brought out. If they constitute the newspaper establishment they must be inseparable parts of it and the concept of the printing press not being a part or the publishing arrangement not being a part of that establishment would militate against the concept of the newspaper establishment. Therefore, the only thing which can bind them together would be the concept of ownership because it is only then that they would be part of a common establishment. If all are not parts of that establishment, it cannot be said that they constitute a newspaper establishment. The word establishment necessarily brings the concept of a group of people as part of a whole namely establishment. In this view of the matter, since the appellants are not part of a common establishment in the sense that they are not owned by the same person or body which owns the newspaper, they cannot be said to belong to the newspaper establishment. In this sense the use of the expression newspaper establishment in the exemption notification would have the effect of restricting the exemption only to such printers and printing presses as are owned by the newspaper owner itself.
19. So far as the question of registration under the Press and Registration of Books Act, 1867 is concerned, the only requirement is that there should be a registration and, since the Act talks of registration of the newspaper, this requirement has been fulfilled in the present case, inasmuch as the newspaper 'AJ' is registered with the Registrar of Newspapers. The concept of ownership of the printer and publisher flows from the use of the expression 'newspaper establishment' in the exemption notification and, inasmuch as the printer and publisher are not owned by the owners of the newspaper, it cannot be said that they are a part of the newspaper establishment. Since there is no dispute on this question that the appellants are not owners of the newspaper establishment at any of the places, they are not entitled to exemption. In the case of Patna, the learned SDR has filed copies of letters exchanged with the Registrar of Newspapers to prove that the ownership of the newspaper was not transferred in the name of the appellants who are merely shown as the printers of the newspaper at that place.
20. Collector (Appeals) has rejected the claim, inter alia, on the ground that the expenditure on establishment does not include the salary of the editor, sub-editor, reporters and other connected staff working for the newspaper. On the other hand, Shri Asthana had stated at the hearing that the expenditure on account of salaries - both of Directors and the employees - is indicated in the Profit and Loss account for the period ending 31st March 1989, which was placed before the Income Tax Authorities. The very fact that the appellants are printers and publishers only shows that they are not concerned with editorial department otherwise this fact would have found specific mention somewhere or the other. Then appellants have also not made any such claim. Therefore, from this angle too it is evident that the appellants' role is limited and they are not a 'newspaper establishment'.
21. Shri Asthana had invited attention to Column 10 of the Declaration, dated 30-10-1985, which is as under :-
"10. Owner's name: Title of the Newspaper owned by M/s Jnanmandal Ltd. (managed by M/s Shashwat Printers (Pvt.) Ltd.)"
22. He had submitted that besides being the printers and publishers of the newspaper, they were also managing it on behalf of the owner. They should, therefore, be regarded as constituting the 'newspaper establsihment' for purposes of the notification. We have examined the whole concept of what is a 'newspaper establishment' and do not consider that, being a private limited company as stated in the Assessment Order of the Deputy Commissioner of Income Tax engaged in printing and publishing of the newspaper and having an identity distinct from that of the newspaper, the appellants can be treated as 'newspaper establishment . In this view of the matter too, the subject goods imported by the appellants are not entitled for exemption.
23. Although the Press and Registration of Books Act does not define the expression 'newspaper establishment', a definition is given in the Working Journalists & Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955 in Section 2(d);
"newspaper establishment means an establishment under the control of any person or body of persons, whether incorporated or not, for the production or publication of one or more newspapers or for conducting any news agency or syndicate".
24. Thus, even under an allied enactment for regulating the conditions of service of employees there is a concept of individual or corporate control over the 'newspaper establishment' which supports the conclusions we have independently reached. The printing and publishing activity of a private limited company cannot, therefore, be reconciled with the concept of a single establishment for the production and publication of a newspaper.
25. For the view we have taken on the interpretation of the exemption notification, we would like to cite the classic decision of the Supreme Court in the case of M/s. Hemraj Gordhandas v. H.H. Dave, 1978 (2) E.L.T. (J 350);
"5...It is well established that in a taxing statute there is no room for any intendment but regard must be had to the clear meaning of the words. The entire matter is governed wholly by the language of the notification. If the tax-payer is within the plain terms of the exemption it cannot be denied its benefit by calling in aid any supposed intention of the exempting authority.".
26. Thus, upon consideration of all aspects of the matter we come to the conclusion that the Graphic Art Films imported by the appellants are not entitled to exemption under Notification No. 103/89-Cus., dated 1/3/89. The appeal is, therefore, rejected.
27. The Cross Objections filed by the learned Collector are also disposed of in terms of the order rejecting the appeal.
ORDER S.L. Peeran, Member (J)
28. I have gone through the proposed draft order of my learned Brother Shri N.K. Bajpai. Unfortunately, I could not persuade myself to agree to his very erudite order. I am therefore, recording my separate order.
29. The question that arises for consideration is as to whether the appellants are entitled to the benefit of the Notification No. 103/89-Cus., dated 1-3-1989. In the main order, the notification has been extracted. There are two main conditions of the notification namely that the exemption is for a newspaper establishment and who is registered with the Registrar of Newspaper of India. In my humble opinion, both the conditions have been fulfilled in this case. The notification reads "Effective rate of duty for specified inputs for the newspaper industry". It follows that the notification has been designed to the "newspaper industry" and in that view of the matter, the newspaper is required to be registered with the Registrar of Newspapers. As can be noted from the Press and Registration of Books Act, 1867, provision has been made for the registration of the 'newspaper'. Newspaper is defined in Section 2(b) of the Working Journalists (Conditions of Service and Misc. Provisions) Act, 1955 as -
"(b) 'newspaper' mean any printed periodical work containing public news or comments on public news and includes such other class of printed, periodical work as may, from time to time, be notified in this behalf by the Central Govt. in the official Gazette".
The definition of 'newspaper', 'paper' and 'Printing' as given in the Press and Registration of Books Act, 1867 in Part I interpretative clause are as follows :
" 'Newspaper' means any printed periodical work containing public news or comments and public news;
"Paper" means any document, including a newspaper, other than a book;
'Printing' includes cyclostyling and printing by lithography."
The preamble of this Act states that -
"An Act for the regulation of Printing presses and newspapers for the preservation of copies of books (and newspapers) printed in (India) and for the registration of such books (and newspapers).
Wheras it is expedient to provide for the regulation of printing presses and newspapers for the preservation of copies of every book and newspaper printed in India and for the registration of such books and newspapers".
Therefore, both the notification in question and the Press and Registration of Books Act, 1867 does not lay any stress on the 'ownership' of one or by the other. The notification as it lays down is meant to give benefit to the "newspaper industry" and in order to regulate the benefit to be taken by genuine persons, has laid down that the 'newspaper establishment' be registered with the Registrar of the Press and Registration of Books Act, 1867. As can be seen from the preamble of this Act, it provides for the registration of the title of the newspaper and declaration of the 'printer and Publisher'. There is no condition for registration of the owners of both 'newspaper' or of the printing presses. There is no provision for registration of newspaper establishment nor the Act regulates their working or working of a newspaper industry, as can be seen from Section 3, 4 of the said Act which is reproduced below -
"Particulars to be printed on books and papers. - Every book or paper printed within (India) shall have printed legibly on it the name of the printer and the place of printing and (if the book or papers be published) (the name) of the publishers and the place of publication.
(*) substituted for "the States by the Part B States (Laws) Act 1951 (III of 1951) Sec.
(**) Inserted by the Amending Act, 1891 (XII of 1891) Section 2 and Schedule II.
Section 4. Keeper of printing press to make declaration. - No person shall within (India) keep in his possession any press for the printing of books or papers, who shall not have made and subscribed the following declaration before (the District, Presidency or Sub-Divisional Magistrate) within whose local jurisdiction such press may be -
"I, A.B., declare that I have a press for printing at...
And this last blank shall be filled up with a true and precise description of the place where such press may be situated.
(2) As often as the place where a press is kept is changed, a new declaration shall be necessary - provided that where the change is for a period not exceeding sixty days and the place where the press is kept after the change is within the local jurisdiction of the Magistrate referred to in sub-section (1), no new declaration shall be necessary if -
(a) statement relating to the change is furnished to the said magistrate within twenty four hours thereof; and
(b) the keeper of the press continues to be the same :"
Section 3 states that the 'Name of the Printer and the place of printing and (if the book or paper be published) the name of the publisher and the place of publication is required to be printed in every book and paper printed in India. Section 4 lays down that 'keeper of printing press' to make declaration. Subsection (1) speaks of "No person shall within India keep in his possession any press". Such person need not be owner. Persons other than owners can be in possession of a press by way of mortgage, lease etc.
30. Sub-section 5(2) also states "that the printers and the publisher of every newspaper shall appear". Therefore, the Act is for registration only of a person in possession of a newspaper and those persons who are printers and publishers and not of a newspaper establishment. Further, a printer or a Publisher need not be a 'owner' of such newspaper or newspaper establishment. Such person can also be a person assigned with lease hold rights, copy rights under the Copyrights Act. Therefore, so long as a person is in possession of a newspaper title and also is a printer, publisher and is also in possession of a newspaper establishment the said person is entitled for grant of a exemption. We cannot put more words in the notification or read the notification in such a way as to make the notification 'otiose'. In this case, there is no dispute of the appellants being owners of 'newspaper establishment' and also having acquired possession of the title of the newspaper, 'AJ' by way of assignment of the rights in their favour. Thus the condition of the notification has been fulfilled. The notification does not say that the benefit is' only for a owner or a person owning a newspaper and newspaper establishment and not for others in possession of 'newspaper' or newspaper establishment. The newspaper establishment is quite independent of newspaper. The Act referred to in the notification simply provides for registration of newspaper and for the registration of printers and publishers of newspaper. It does not stipulate that the person who is in a possession of a printing press or newspaper establishment should be a owner and also be a owner of a newspaper. However, in this case, the appellants are the owners of the newspaper establishment and they have also filed declaration on behalf of the owner of the newspaper title holder as per sub-section 2-A, 2-B of Section 5 of the said Act. Thus the benefit of the notification has been fulfilled. The rights of the newspaper has also been assigned to them.
31. The Registrar of Newspapers has also issued certificate of registration which satisfies the requirement of the notification. In the case of C.C.E., Cochin v. M/s. Hindustan Newsprint Ltd. (Order No. 187/92-C, dated 24-6-1992), Notification No. 167/87 came in for interpretation. This notification provides for the benefit of exemption to the paper intended for use in the printing of newspapers, text books or other books of general interest. The learned Member (Tech.) in para 31 has very correctly analysed the considerations that should weigh with the authority, as can be noted herein below -
"The question that remains to be answered is what then is the nature of evidence which would prove to the satisfaction of the authorities that the paper is intended for use for purposes specified in the notification. The considerations which can weigh with the authority can be one or more of the following types in asking for appropriate evidence -
(a) Whether the buyer is a person of repute who has regularly been printing newspapers and text books or other books of general nature.
(b) Whether the buyer of paper is one who is engaged in using it in the printing of newspapers and text books or other books of general nature;
(c) Whether the buyer has made such purchases in the past or has placed orders for supply of such paper from manufacturers of such paper;
(d) Whether evidence of actual sale in the form such as invoice and other documents has been fulfilled;
(e) if the transaction is not genuine;
(f) Whether the authorities have received any complaints that paper supplied to particular buyers has not been used in the printing of newspapers or text books or other books of general nature even though it was granted exemption from duty under the notification on the ground that it was intended for use for the specified purposes".
32. As can be seen from above, the question of ownership of newspaper etc. was not rightly gone into as the notification does not deal with such a requirement. As has been observed, the transaction has to be genuine. That being so, the benefit of the notification cannot be denied in this case. Therefore, I order for allowing the appeal and reject the cross objection of the department, as it is not in the nature of cross appeal but mere comments on the appeal filed by the appellants.
(S.L. PEERAN) Member (Judicial)
33. In the light of the majority view, the appeal is rejected.