Bombay High Court
Union Of India vs Sahney Steel And Press Works Ltd. on 21 October, 1991
Equivalent citations: 1991ECR321(BOMBAY), 1992(58)ELT38(BOM)
Author: S.P. Bharucha
Bench: S.P. Bharucha
JUDGMENT Bharucha, J.
1. The appeal is directed against the judgment and order of the learned single Judge making the writ petition filed by the respondents to the appeal absolute.
2. The respondents manufacture starter armatures which are parts of starter motors used in automobile engines for starting them. The contention of the appellants was that starter armatures fell within Item 30, sub-item (4) of the Tariff under the Central Excises and Salt Act which reads thus :
"Electric Motors, all sorts and parts thereof, namely :
1. x x x x x x
2. x x x x x x
3. x x x x x x
4. Parts of electric motors.
Explanation - This item does not include motors specially designed for use in gramophones or record players and all parts of such motors."
According to the respondents, starter armatures were parts of automotive starter motors. They could not rotate and start the automotive engine by themselves; they had to be fitted into a starter housing which consisted of various other parts. While the principle of the operation of a starter motor and that of an electric motor might be the same, functionally they could not be inter-changed. The automotive starter was a special type of motor capable of delivering high torque for a short period of time and it was used as a cranking device. The starter motors, within which the starter armatures were placed, could only be used in automobiles and a starter motor designed for a particular type of automobile could not be used in another type of automobile. It could not also be used for any other purpose. It was, therefore, the case of the respondents that starter armatures fell within Tariff Item 34A which reads thus :
"Parts and accessories of motor vehicle not otherwise specified."
3. The Assistant Collector of Central Excise held that the respondents' starter armatures fell within Item 30, sub-item (4). His order was upheld by the Appellate Collector of Central Excise. The revision therefrom was dismissed. The Government of India relied upon two grounds taken by the respondents in their Revision Application. They read :
"Perusal of IS Specification shows that the Starter motors are special purpose motors designed to be operated under D.C. Voltage 6, 12, 24 V and they cannot be normally used for any other application."
"The Principle of operation in an Electric Motor and a Starter Motor may be the same. But functionally it cannot be interchanged."
These grounds led the Government to conclude that a starter motor was an electric motor within the meaning of Item 30, the scope whereof was not tied to the end-use. The respondents were correct in their contention, the Government said, that in interpreting an item in a taxing statue the meaning attached to the item by the trade should be given importance, but the respondents had not been able to put forth any argument showing that a starter motor was not an electric motor. All that they had said was that a starter motor found use only in an automobile and should, therefore, be considered as a motor vehicle part. The Government was of the view that the moment the starter armature was classifiable under Item 30, it was not classifiable under Item 34-A.
4. The order in revision was impugned in the writ petition. Annexed to the writ petition were two certificates, one issued by the Bombay Motor Merchants' Association and the other by the All India Automobile and Ancillary Industries Association. The first certified that the starter used in an automobile was not known in the market or trade as an electric motor. It was only known to be an ancillary part of an automobile. This type of starter and its parts could be procured only from the automobile ancillaries market and not from the electric motors market. The latter certificate said mush the same thing in somewhat greater detail. To the petition no affidavit in reply was filed by the appellants. No material to counter the certificates was produced. By the judgment and order under appeal the learned Judge, rightly, noted that what was relevant was the meaning attributed to a term in a fiscal statute by people in the trade. That is how the term had to be understood and not as it was treated in technical books meant for technical people. [See Advani-Oerlikon Ltd. v. Union of India, 1981 (8) ELT 462]. The learned Judge also noted that the onus of satisfying the court that particular goods fell within a particular item of the Tariff lay upon the authorities. The excise authorities had not laid any material before him to show that the respondents' starter armatures were parts of electric motors under Item 30, sub-item (4). On the other hand, there was material in the form of the certificates of the trade produced by the respondents which indicated that starter armatures were treated as automobile ancillaries and could be procured only from the automobile ancillaries market and not from the electric motors market.
5. Mr. Master, learned counsel for the appellants, submitted that of the two rival entries, Item 30, sub-Item (4) was specific and was, therefore, applicable to the starter armatures. In his submission, "admittedly, starter motors were part of electric motors". We asked Mr. Master repeatedly to show us where this admission was made. He referred, first, to the order of the Government in revision citing the two grounds in the Revision Application which we have quoted. He referred next to the order of the Appellate Collector of Central Excise which notes only this "admission" on the part of the respondents that a starter armature is used as a rotor for starting; it works as a rotor for a very short time. However, the fact could not be ignored, according to the Appellate Collector, that it was a rotor specially designed for starting motor cars and, being a rotor in a starting motor, it was a part of an electric motor although the rotor ran for a very short time on batteries for automobiles. Lastly, Mr. Master submitted that the admission was contained in his own submission before the learned Judge that the function of the armature was to rotate and, therefore, it could do the work of an electric motor and necessarily had to be considered as a part of an electric motor within the meaning of Item 30, sub-Item (4). In none of these references by Mr. Master do we find as admission that a starter armature is an electric motor or a part thereof.
6. There is not material on record to show that a starter armature is a part of an electric motor and, therefore, classifiable under Item 30, sub-Item (4). It was open to the appellants to have laid material before the learned Judge to show how starter armatures were treated by the trade and to controvert the certificates of the trade produced by the respondents. They failed to do so. The learned Judge was, therefore, justified in taking the view he did.
7. The appeal must, therefore, be dismissed with costs.
8. Certified copies of this order to be made available to both parties expeditiously.