Bombay High Court
Cine Super 8 Private Ltd. vs Union Of India on 28 January, 1994
Equivalent citations: 1994ECR180(BOMBAY), 1994(72)ELT20(BOM)
Author: H.L. Gokhale
Bench: H.L. Gokhale
JUDGMENT V.A. Mohta, J.
1. Whether documentary films and advertisement shorts of a width of 8 mm. manufactured and processed by the petitioners are exempt under the following Notification from the whole of the duty of excise leviable under Tariff Item 37 of the First Schedule to the Central Excises and Salt Act, 1944, is the question that falls for determination in this petition.
"Notification No. 210/76 dated 17-7-1976.
In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 63/60-CE, dated the 20 April, 1960, the Central Government hereby exempts cinematograph films, exposed, which are proved to the satisfaction of the Collector of Central Excise as being intended exclusively for the entertainment of children or for educational purposes, and cinematograph films of a width not exceeding 9.5 mm. from the whole of the duty of excise leviable thereon.
Nothing contained in this notification shall apply to feature films which are produced for entertainment of persons other than children."
The above Notification is in supersession of the Notification dated 20th April 1960 and the only change brought about is addition of second para. The petitioners claimed full exemption from excise duty on the basis of the above Notification. Requests have been rejected by various Assistant Collectors and aggrieved thereby, this petition has been filed.
2. According to the petitioners the Notification grants exemption to the following two distinct categories of exposed cinematograph films. (i) Films which are proved to the satisfaction of the Collector as being intended exclusively for (a) the entertainment of children or (b) educational purposes, irrespective of width and (ii) Films of width not exceeding 9.5 mm., irrespective of the purpose for which they are made. Submission is that even though the films in question are neither for educational purposes nor for entertainment of children, since they are of width not exceeding 9.5 mm. they fall in the second category and hence entitled to exemption. No doubt, the Notification is clumsily drafted. But it is not possible to accept the submission. Close scrutiny of the Notification reveals that the cinematograph film must satisfy all the following three conditions simultaneously in order to fall into exempted category. (1) It must be exposed. (2) It must be intended exclusively for entertainment of children or for educational purposes. (3) It's with should not exceed 9.5 mm.
3. Inviting our attention to presence of comma after the words "educational purposes" and before the words "and cinematograph films" in the notification, it was contended that the two clauses must be read as disjunctive leading to the inevitable conclusion that the film of a width not exceeding 9.5 mm. was entitled to unconditional exemption. Now, punctuation is a only minor element in construction of a statute. No doubt, when a statute is carefully punctuated and there is doubt about its meaning, weight should be given to the punctuation, as observed by the Supreme Court in the cases of Aswini Kumar v. Arabinda Bose and Dr. M.K. Salpekar v. Sunil Kumar Shamsunder Chaudhari & Ors. (A.I.R. 1988 S.C. 1841). But that principle cannot be applied to the instant Notification. In this context, use of the word "and" and not "or" before the words "cinematograph films of a width not exceeding 9.5 mm.", cannot be lost sight of. Use of the word "and" and not "or" is significant and the context does not justify reading the word "and" as "or" though these words are sometimes readily inter-changeable. The deliberate addition of the second para in the Notification which is in the nature of Explanation cannot be ignored since it could not be an exercise in futility. No doubt, the comma in the Notification is rendered superfluous by the above interpretation, but the whole context makes that demand.
4. Learned counsel for the petitioners also invited our attention to the case of M/s. Hemraj Gordhandas v. H.H. Dave, Assistant Collector of C.E. & Ors. [1978 (2) E.L.T. 350] laying down that in a taxing statute if the meaning of the word is clear, there is no room for any intendment. The present Notification does not belong to the category of cases where language is so clear as to give no room to make a search for the object.
5. There is one more indication in support of the view we are taking about the film of the width not exceeding 9.5 mm. being not an independent category in the said Notification, so as to attract unconditional exemption. That is, another exemption Notification No. 275/77.C.E., dated 12-8-1977 as amended by Notification No. 342/77- C.E., dated 15-12-1977 and No. 37/78-C.E., dated 1-3-1978. By that Notification, feature films and advertisement shorts have been given certain other limited exemptions, treating [them] as an independent class. Notification No. 210 of 1976 was in force when the above Notification No. 275 of 1977 was issued and normally there would not be overlapping of the exemptions.
6. In Notification No. 210 of 1976, second para in the form of Explanation has been added to the effect that nothing contained in the Notification shall apply to feature films which are produced for entertainment of persons other than children. It is axiomatic that Explanation only explains and does not expand or add to the scope of the main provision and it makes plain or clear from obscurity something which may arise from the main provision. It also highlights that exemption is intended only for the short width films produced for specific purposes. The words preceding the expression "cinematograph films of a width not exceeding 9.5 mm." and the para following the expression given indication that the said variety of films was not treated as a class into itself and was not given unconditional exemption.
7. The submission on behalf of the petitioners is that the Explanation should be read as restricted only to one of the two varieties of the exempted category viz the cinematograph films exclusively meant for children irrespective of its width. Neither the language of the Notification nor the intendment warrant such a view, which would lead to unintended absurd results.
8. The Supreme Court in the case of Union of India v. Wood Papers Ltd. (1990 (47) E.L.T. 500) has highlighted the difference in principles for interpreting an exemption Notification and a statute and learned counsel for the respondents is right in contending that the Notification is in the nature of exception and will have to be read as such and as a whole.
9. In the result, the petition fails. Rule discharged. No costs.