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CASE NO.:

Appeal (civil) 467 of 1987

PETITIONER:

REAL OPTICAL CO.

Vs.

RESPONDENT:

APPELLATE COLLECTOR OF CUSTOMS & ANR.

DATE OF JUDGMENT: 01/02/2001

BENCH:

S.s.M.quadri, S.N.Phukan

JUDGMENT:

PHUKAN, J.

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This appeal by special leave is directed against the

judgment dated 1-7-1986 of the Customs, Excise and Gold

(Control) Appellate Tribunal, New Delhi.

The question raised in this appeal is whether Rough

Ophthalmic Blanks falls under tariff item No.23-A (4) or

under Residuary Tariff item No.68 of Central Excise Tariff.

The appellant imported Rough Ophthalmic Blanks and was

called upon to pay counter-vailing duty, which was paid.

The Appellate Collector of Customs, Mumbai in another appeal

held that Rough Ophthalmic Blanks could be charged to duty

only under Residuary Tariff item No.68. The appellant,

therefore, applied to the Assistant Collector of Customs

(Incharge of Refund), Madras claiming refund of the above

counter-vailing duty, which was rejected. The appeal and

the review filed by the appellant were also dismissed.

Thereafter, the appellant filed the appeal before the

Customs, Excise and Gold (Control) Appellate Tribunal, New

Delhi. The Tribunal heard the appeal filed by the appellant

along with other appeals and dismissed the appeal of the

appellant by the impugned judgment dated 1.7.1986.

The facts are not disputed that Rough Ophthalmic

Blanks with optical properties are manufactured out of

combination of highly purified form of raw glass and other

materials such as silica, alumina, sodium potassium and rare

earths etc. after technical, chemical and thermal

processes.

The Tribunal rejected the contention on behalf of

appellant that Rough Ophthalmic Blanks are not imported as

glass simpliciter but as a special commodity for the purpose

of manufacture of spectacle lenses. According to Tribunal,

the true test for classification is not the actual process

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adopted for manufacture but the identity of the goods with

the relevant description or definition in the First Schedule

to the Act or failing that, in terms of commercial parlance

and further that the existence or otherwise of optical

properties, as distinguished from the exact specification

required for optical glass, is no criterion for inclusion

in, or exclusion out of the above Item. The Tribunal also

referred to Indian Standard Glossary of terms relating to

glass and glassware and after discussion did not accept the

contention on behalf of the appellant that Rough Ophthalmic

Blanks though made of glass are not known in the trade as

glass.

Learned counsel for the appellant has placed reliance

on other authorities to explain how Rough Ophthalmic Blanks

are made from glass. In our opinion it is not necessary to

go into these authorities as we have already explained how

Rough Ophthalmic Blanks are made and this is not disputed.

According to learned counsel for revenue, Rough

Ophthalmic Blanks would fall under the above Tariff Item

23-A (4), as these are articles of glass.

Tariff Item 23-A (4) after amendment on 1.3.1979 read

as follows:- other glass, glass ware including tableware

Tariff Item 68 is of residuary character and relates

to all other goods not elsewhere specified. The rate of

duty is higher if the product falls under Tariff Item No.23A

(4) then if it fell under Tariff Item No.68.

It is settled position of law that in interpreting

items in Status like Excise Acts or Sales Tax Acts resorts

should be had not to the scientific or technical meaning of

the terms or expressions used but how is the product

identified by the class or section of people dealing with or

using the product, however, if any term or expression has

been defined in the enactment then it must be understood in

the sense in which it is so defined. It is also a common

experience that the identity of an article is associated

with its primary function inasmuch as a customer buys it to

perform a specific function from it.

What was important by the appellant was not glass

simplicitor but Rough Optical Blanks. We have already

referred that Rough Optical Blanks with optical properties

are manufactured out of combination of highly purified raw

glass and other material after highly technical, chemical

and thermal process.

A general merchant dealing in glass or tableware does

not deal in articles like Rough Optical Blanks with optical

properties, which may be used for making spectacles. The

functional character of Rough Optical Blanks is different

from glass or glassware, as these commodities are used for

different purpose viz. making of optical lenses, etc.

Rough Optical Blanks are purchased by manufacturer of

spectacles for making spectacle lenses not for the purpose

of other glasses or glassware including tableware.

In M/s. Indo International Industries versus

Commissioner of Sales Tax, Uttar Pradesh, AIR [1981] SC

1079, a three judge Bench of this Court considered the entry

glassware falling within Entry No.39 of First Schedule of

U.P. Sales Tax Act and held that clinical syringes would

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not fall under the said entry. It was also held that in

commercial sense glassware would never comprise articles

like clinical syringes, thermometer, etc., which have

specialized significance and utility. In this appeal also

Rough Optical Blanks has specialized utility and, therefore,

would not come under Tariff Item No.23A (4).

In Atul Glass Industries (Pvt.) Ltd. versus Collector

of Central Excise [1986] 3 SCC 480, the Bench of this court

held that glass mirror cannot be classified as other glass

or glassware set forth in Tariff Item 23-A (4) and must,

therefore, fall under the residuary Tariff Item 68 of the

First Schedule to the Act.

For the reasons stated above, we have no hesitation to

hold that Rough Optical Blanks would not come under Tariff

Item No.23A (4) and will come under Residuary Tariff Item

No.68. Accordingly we hold that the appeal has merit and it

is allowed by setting aside the impugned judgment. In the

facts and circumstances of the case we direct the parties to

bear their own costs.