Supreme Court of India
G. Claridge And Company Limited vs Collector Of Central Excise, Pune on 12 February, 1991
Equivalent citations: 1991 SCR (1) 317, 1991 SCC (2) 229, 1991 AIR SCW 474, 1991 (2) SCC 229, (1991) 32 ECC 310, (1991) 33 ECR 433, (1991) 52 ELT 341, 1991 CRILR(SC MAH GUJ) 253, (1991) 1 SCR 317 (SC), (1991) 1 JT 394 (SC)
Author: S.C. Agrawal
Bench: S.C. Agrawal, K.J. Shetty
PETITIONER:
G. CLARIDGE AND COMPANY LIMITED
Vs.
RESPONDENT:
COLLECTOR OF CENTRAL EXCISE, PUNE
DATE OF JUDGMENT12/02/1991
BENCH:
AGRAWAL, S.C. (J)
BENCH:
AGRAWAL, S.C. (J)
SHETTY, K.J. (J)
CITATION:
1991 SCR (1) 317 1991 SCC (2) 229
JT 1991 (1) 394 1991 SCALE (1)188
ACT:
Central Excises and Salt Act, 1944/Central Excise
Rules, 1944/ Central Excise Tariff Act, 1985: First
Schedule, Item No. 17 & Notification dated
28.2.1982/Rule 8(1)/Chapter 48, Heading 48.18: 'Egg
trays'-Whether regarded as 'containers'.
Statutory Interpretation: Two or more words-Coupled
together susceptible of analogous meaning-Interpretation
of.
Words and Phrases: 'Containers'-Meaning of.
HEADNOTE:
The appellant was a manufacturer of egg trays and
other similar items. Before the introduction of Central
Excise Tariff Act, 1985 (new Tariff) effective from
1.3.1986, Central Excise and Salt Act, 1944 (old Tariff)
was applicable to the relevant products. The appellant,
classifying its product under Item 68 of the old Tariff, was
paying duty accordingly. By Notification dated February
28, 1982, issued under Rule 8(1) of the Central Excise
Rules, 1944, the Central Government exempted articles
of paper and paper-board falling under Item 17(4) of the
old Tariff. The appellant filed a revised classification
list for its products seeking classification under item
17(4). The Asstt. Collector, Central Excise held the
products classifiable as 'articles of pulp' under Item 68
of the old Tariff, and the appellant was required to pay
excise duty accordingly.
On appeal, the Collector (Appeals) reversed the
order of the Asstt. Collector, and held that the
products were made out of waste paper and were
classifiable under Item 17(4) as 'articles of paper and
paper-board'. The Revenue filed appeals before the
Customs, Excise and Gold (Control) Appellate Tribunal.
On introduction of the new Tariff, the
appellant classified the relevant products as
'containers' under sub-heading 4818.19 and claimed
exemption. The Asstt. Collector held that the products
were not 'containers' but were 'articles of pulp'
falling under sub-heading 4819.90 and accordingly
chargeable to duty. Setting aside the order in
318
appeal, the Collector held that the products were 'packing
containers' and classifiable under sub-heading 4818.19.
The Revenue appealed before the Appellate Tribunal,
which allowed all the appeals by a common judgment, but
remanded the matter to the Collector (Appeals) with regard
to the recovery for a certain period.
In the assessee's appeal to this Court it was contended
that the `egg trays' manufactured by the appellant were
'containers' under Item 17 and Heading 48.18 of the
respective Tariffs; that merely because the egg tray
was described as a tray does not mean that it was not
a container; and that it was not required that a
container should be closed from all sides.
On the question whether: egg trays and other
similar products manufactured by the appellant are
'containers' falling under Item No. 17(4) or 17(3) of
the First Schedule to the Central Excises and Salt Act,
1944 and Heading 48.18 of the Central Excise Tariff Act,
1985.
Dismissing the appeals, this Court,
HELD: 1. 1 'Egg trays' being receptacles which are
not covered or enclosed cannot be used for
transportation of articles and cannot be regarded as
'containers' under Item 17 of the First Schedule to
Central Excise and Salt Act, 1944 and Heading 48.18
of the Schedule to Central Excise Tariff Act, 1985.
[326B]
1.2 Moulded pulp egg trays containing the eggs
are put in a standard case for the purpose of
transport. The case in which the egg trays are put,
are 'containers' and not the 'egg trays' itself. [326E-F]
1.3 The expression 'container' is used in three
different senses: in a broad sense, it means
a receptacle which contains; in a narrower sense, it
means a receptacle in which articles are covered or
enclosed and transported; and in a more limited sense,
it means enclosures used in shipping or railway for
transport of goods. If used in a broad sense,
`container' would include a tray because it is a
receptacle which contains articles and, therefore, an egg
tray would be a 'container'. But an egg tray would not
be a 'container' in a narrower sense because articles
placed in it are not covered or enclosed and they
cannot be transported as such. [325D-F]
319
1.4 In item 17 of the First Schedule to Central
Excises and Salt Act, 1944 the word 'containers' is
preceded by the words 'boxes, cartons, bags and
other packing' and in Heading 48.18 of the Schedule
to Central Excise Tariff Act, 1985, the word
'containers' is preceded by the words 'cartons, boxes'
and is followed by the words 'and cases'. Considering the
expression 'containers' in the context in which it is
used in the relevant tariff items, the said expression
has to be construed to mean 'packing containers'
which are analogous to boxes and cartons, that is,
an enclosed receptacle which can be used for storage
and transportation of articles. [325G, 326A-B]
Webster's New Collegiate Dictionary, 1975
Chambers' 20th Century Dictionary Indian Standard-
Glossary of Terms Glossary of Packaging Terms
(USA) Glossary of Packaging Terms (Australia) New
Encyclopedia Britannica, referred to.
2. It is a well-accepted canon of statutory
construction that when two or more words which
are susceptible of analogous meaning are coupled
together they are understood to be used in their
cognate sense. It is based on the principle that words take
as it were their colour from each other, that is, more
general is restricted to a sense analogous to a less
general. [325G-H, 326A)
Dr. Devendra M. Surti v. State of Gujarat, [1969] 1
SCR 235, relied on.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 160-63 of 1990.
From the Order dated 25.9.89 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. E/1883/85-C, E/2031/85-C, E/ 1468/88-C and E/ 1986/88-C (Order No. 543-546 of 1989-C).
M.L. Lahoty, Mrs. Meeta Sharma and P.S. Jha (NP) for the Appellant.
M. Chander Sekaran, Additional Solicitor General (N.P.). M. Gouri Shanker Murthy, G. Venkatesh Rao and P. Parameshwaran for the Respondent.
The Judgment of the Court was delivered by 320 S.C. AGRAWAL, J. These appeals raise for consideration the question as to whether egg trays and other similar products manufactured by the appellant can be regarded as 'Containers' under the relevant entries in the Central Excise Tariff.
Till February 28, 1986 the excise tariff was contained in the First Schedule to the Central Excises and Salt Act, 1944 (hereinafter referred to as 'the old Tariff') and with effect from March 1, 1986, the excise tariff is contained in the Schedule to the Central Excise Tariff Act, 1985 (hereinafter referred to as 'the new Tariff). The relevant entry in the old Tariff was Item 17. During the period March 1, 1982 to February, 1983, the said Item 17 read thus:
"Paper and paper board, all sorts (including paste-board, mill board, straw
board, cardboard and corrugated board) and articles thereof specified below, in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power-
(1) Uncoated and coated printing and writing paper (other than poster paper) (2) Paper board and all other kinds of paper (including paper or paper boards which have been subjected to various treatments such as coating, impregnating, corrugation, creping and design printing), not elsewhere specified.
(a) All sorts of paper commonly known as Kraft paper, including paper and paper board of the type known as Kraft liner or corrugating medium, of a substance equal to or exceedings 65 gram per square metre in each case.
(b) Others.
(3) Carbon and other copying papers (including duplicator stencils) and transfer papers, whether or not cut to size and whether or not put up in boxes.
(4) Boxes, cartons, bags and other packing containers (including flattened or folded cartons, whether or not printed and whether in cartons), whether or not printed and whether in assembled or unassembled conditions."
321Item 68 of the old Tariff was in the nature of residuary entry.
By notification No. 66/82-CE dated February 28, 1982, the Central Government, in exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, exempted articles of paper or paper-board falling under sub-item (4) of item 17 of the old Tariff from the whole of the duty of excise leviable thereon. The said exemption was, however, not applicable to printed boxes and printed cartons (including flattened or folded printed boxes and flattened or folded printed cartons) whether in assembled or unassembled condition.
With effect from March 1, 1983, Item 17 was substituted and during the period March 1, 1983 to February 28, 1986, it read as under:
c "Paper and Paper board, all sorts (including pasteboard, mill board, strawboard, cardboard and corrugated board), and articles thereof specified below, in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power-
(1) Paper board and all other kinds of paper (including paper or paper boards which have been subjected to various treatments such as coating, impregnating, corrugation, creping and design printing), not elsewhere specified.
(2) Carbon and other copying papers (including duplicator stencils) and transfer papers, whether or not put up in boxes.
(3) Boxes, cartons, bags and 'Other packing containers (including flattened or folded boxes and flattened or folded cartons), whether or not printed and whether in assembled or unassembled conditions."
In the new Tariff, the relevant entry under Heading 48.18 in Chapter 48 is as follows:
G
------------------------------------------------------------ "48.18 OTHER ARTICLES OF PAPER PULP, PAPER. PAPERBOARD, CELLULOSE WADDING OR WEES OF CELLULOSE FIBRES:
Cartons, boxes, containers and cases (including flattened or folded boxes and flattened or folded cartons), whether in assembled or unassembled condition:322
4818.11 Intended for packing of match sticks 4818.12 Printed cartons, boxes, containers and cases, made wholly out of paper or paper-board of heading No. or sub-heading No. 48.04, 4805.11, 4806.19, 4807.91, 4807.92, 48.08 or 4811.10, as the case may be 4818.13 Other printed cartons, boxes and cases 4818.19 Other"
------------------------------------------------------------ 4818.20 Toilet tissues, handkerchiefs and cleansing tissues of paper 4818.90 Other."
------------------------------------------------------------ On products falling under sub-Heading 4818.19, the excise duty was nill whereas on products falling under sub-Heading 4818.90, the excise duty was payable at the rate of 12%.
M/s. G. Claridge & Company Ltd. the appellant herein manufactures (i) egg filler flats, (ii) egg cartons, (iii) tube light packing trays, (iv) duck egg trays and (v) apple trays. It filed a classification list for the above goods effective from April 1, 1981 classifying the products under Item 68 of the old Tariff and it was paying duty at the prevailing rate under Item 68. After the introduction of the revised Item 17 with effect from February 28, 1982/March 1, 1982, the said appellant filed a revised classification list effective from March 1, 1982 for the aforesaid five products seeking classification under Item 17(4) and claiming full exemption from central excise duty under notification dated February 28, 1982. This classification list was approved by the Assistant Collector of Central Excise, Pune Division on March 11, 1982, but on re- examination Department felt that the said products did not merit classification under Item 17(4) but under Item 68 of the old Tariff and a show cause notice dated May 4, 1984 was issued. After considering the reply of the appellant to the said show cause notice, the Assistant Collector of Central Excise, Pune Division passed an order dated January 28, 1985 whereby he held that 'egg trays' manufactured by the appellant were correctly classifiable under Item 68 of the old Tariff and not under Item 17(4) and the appellant was required to pay central excise duty at the appropriate rate leviable on all types of egg trays manufactured and cleared from its unit during the period of six months prior to the notice dated May 4, 1984. The Assistant Collector was of the view that the articles manufactured by the appellant were articles manufactured directly from the pulp and were, therefore, classifiable as 'articles of pulp' under Item 68. The said order of the Assistant Collector was reversed in appeal by the Collector of Central Excise 323 (Appeals) by his order dated April 30, 1985 on the view that the products manufactured by the appellant were made out of waste paper and they were classifiable under Item 17(4) as 'articles of paper and paper-board'. Feeling aggrieved by the said order of the Collector (Appeals), the Department filed appeals Nos. E/1883/85-C and E/2031/85-C before the Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as 'the Appellate Tribunal').
After the introduction of the new Tariff with effect from March 1, 1986, the appellants filed a classification list classifying their products as 'containers' falling under sub-heading 4818.19 of the new Tariff and since no duty was payable under the said sub-heading, the appellants claimed exemption from payment of excise duty on their products. The said classification list was approved provisionally but subsequently the Assistant Collector, Central Excise issued a show cause notice dated October 16, 1986 proposing to classify the goods under sub-heading 4818.90 chargeable to duty @ 12% ad valorem. After considering the reply to the said show cause notice, the Asstt. Collector, Central Excise, by his orders dated April 15, 1987 and July 1, 1987 held that the products manufactured by the appellant were not 'containers' but were 'articles of pulp' falling under sub-heading 4818.90. The said orders were set aside by the Collector of Central Excise (Appeals) by his orders dated March 22, t988 and June 6, 1988. The Collector (Appeals) held that the products manufactured by the appellant were 'packing containers' and classifiable under sub-heading orders of the Collector (Appeals), 4818.19. Feeling aggrieved by the Department filed appeals before the Appellate Tribunal which were registered as Appeals Nos. E/1468/88-C and E/1986/88-C. All the above four appeals were disposed by the Appellate Tribunal by a common order whereby the said appeals were allowed. The Appellate Tribunal held that the products manufactured by the appellant cannot come within the sub- classification below containers and were not classifiable under sub-heading 4818.19 but were classifiable under sub-head-ing 4818.90 of the new Tariff and similarly they were not classifiable under item 17(4) or 17(3) of the old Tariff. The Appellate Tribunal was also of the view that the products manufactured by the appellant are articles of paper because starting raw materials is waste paper. The Appellate Tribunal has held that the duty demanded by the Assistant Collector for six months prior to the issue of show cause notice dated May 4, 1984, i.e., from November 4, 1983 is legally sustainable and with regard to recovery of the duty for the earlier period from March 1, 1982 by invoking the proviso to Section 11- A(l) of the Central Excises and Salt Act, 1944, the Appellate Tribunal remanded the matter to the Collector (Appeals) for considering the said question.324
The question which arises for consideration in these appeals is whether the egg trays and other similar products manufactured by the appellants are 'containers' falling under Item 17(4) of 17(3) of the old Tariff and sub-heading 4818.19 of the new Tariff.
The learned counsel for the appellant has urged that the products manufactured by it are 'containers' and in support of this submission the learned counsel has invited our attention to the meaning of the term 'container' as contained in the Dictionaries and the Indian Standard Glossary of Terms relating to paper or paper-board, packaging materials, Glossary of Packaging Terms (USA) and Glossary of Packaging Terms (Australia). The submission of the learned counsel is that a 'container' is a receptacle which holds, restrains or encloses the item to be stored or transported and that the egg tray and other similar products manufactured by the appellant are 'containers' because they are receptacles for holding, storing and transporting the things kept in them. It has been urged that a 'tray' is a shallow lidless container and merely because an egg tray is described as a tray does not mean that it is not a 'container'. It is contended that egg trays are so designed as to protect the eggs from breakage and that egg trays provide the best mode for storage and transport of eggs. The learned counsel has submitted that the Appellate Tribunal was in error in proceeding on the basis that egg tray and other similar products manufactured by the appellant cannot be regarded as 'containers' because when a single egg tray is reversed or turned upside down or tilted sideways vertically at 90% angle, the contents would fall down. The submission of the learned counsel is that it is not required that a container should be closed from all sides and that a container can also be open.
The expression 'container' has been thus defined in the dictionaries and Glossaries of Packaging Terms:
"Container: One that contains; a receptacle or flexible covering for shipment of goods. (Abstract from Webster's New Collegiate Dictionary, 1975) "Container: that which contains that in which goods are enclosed for transport.
(Abstract from Chambers' 20th Century Dictionary) "Containers-Any receptacle which holds, restrains or 325 encloses any article or commodity or articles or commodities to be stored or transported.
(Abstract from Indian Standard-Glossary of Terms: 1.8. 4261- 1967) "Container. (1) In general, any receptacle or enclosure used in packaging and shipping. (2) Relatively large, reusable enclosures to be filled with smaller packages and discrete objects, to consolidate shipments and allow transport on railway flat cars, flatbed trailers, aircraft, in ships' holds or as deckloads, etc. (See CARGO TRANSPORTER; CONTAINERIZATION). (3) Any receptacle for holding a product."
[Abstract from Glossary of Packaging Terms (USA)] "Container. A large box for intermodal transport, containing many smaller boxes of different shapes and sizes as well as individual articles. [Abstract from Glossary of Packaging Terms (Australia)] The above definitions would show that the expression 'container' is used in three different senses:
in a broad sense, it means a receptacle which contains; in a narrower sense, it means a receptacle in which articles are covered or enclosed and transported; and in a more limited sense, it means enclosure used in shipping or railway for transport of goods. If used in a broad sense, 'container' would include a tray because it is a receptacle which contains articles and, therefore, an egg tray would be a 'container'. But an egg tray would not be a 'container' in a narrower sense because articles placed in it are not covered or enclosed and they cannot be transported as such. It is,therefore, necessary to ascertain whether the expression 'container' in Item 17 of the old Tariff and Heading 48.18 of the new Tariff has been used in the broad sense to include all receptacles or in a narrower sense to mean those receptacles in which the articles are covered or enclosed and transported. For this purpose, the context in which the word 'container' has been used in these entries has to be examined. In Item 17 of the old Tariff, the word 'containers' is preceded by the words 'boxes, cartons, bags and other packing' and in Heading 48.18 of the new Tariff, the word 'containers' is preceded by the words cartons, boxes' and is followed by the words 'and cases'. It is a well-accepted canon of statutory construction that when two or more words which are susceptible of analogous meaning are coupled together they 326 are understood to be used in their cognate sense. It is based on the principle that words take as it were their colour from each other, that is, the more general is restricted to a sense analogous to a less general. [See: Dr. Davendra M Surti v. State of Gujarat, [1969] 1 SCR 235 at p. 240]. Considering the expression 'containers' in the context in which it is used in the relevant tariff items, we are of the opinion that the said expression has to be construed to mean 'packing containers' which are analogous to boxes and cartons, that is, an enclosed receptacle which can be used for storage and transportation of articles. Egg trays being receptacles which are not covered or enclosed cannot be used for transportation of articles and, therefore, they cannot be regarded as 'containers' under the abovementioned entries in the Excise Tariff. According to the New Encyclopaedia Britannica, the practice followed in the various countries for the packaging of eggs for transport is as follows:
"Packaging. For retail use in the United States, eggs are repackaged in dozen and half-dozen paperboard cartons. In some other countries they are packed with straw or excelsior in long wooden boxes. In many parts of the world, they are marketed in baskets or boxes and the individual eggs are sold by weight. Several European countries stamp each egg with a date and number to meet the import restrictions of other nations."
[p. 444, Vol. 6, 1974 edition] The Glossary of Packaging Terms (USA) also shows that moulded pulp egg trays are put in a standard case which indicates that the egg trays containing the eggs are put in a case for the purpose of transport. In other words, the case in which the egg trays are put are `containers' and not the 'egg tray' itself.
For the reasons aforesaid, we are of the opinion that the Appellate Tribunal was right in taking the view that the egg trays and other similar products manufactured by the appellant cannot be regarded as `containers' under the relevant items of the Excise Tariff.
The appeals, therefore, fail and are accordingly dismissed. There will be no orders as to costs.
R. P. Appeals dismissed.
327