CHHEDA INDUSTRIES versus COLLECTOR OF CUSTOMS, MADRAS

Citation: [1997] 3 S.C.R. 343 · Decided: 25-03-1997 · Supreme Court of India · Bench: S.C. SEN · Disposal: Appeal(s) allowed
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Judgment (excerpt)

CHHEDA INDUSTRIES 
A 
v. 
COLLECTOR OF CUSTOMS, MADRAS 
MARCH 25, 1997 
(S.C. SEN AND SUJATA V. MANOHAR, JJ.] 
B 
Custom Tariff Act, 1975 : 
Tanff Heading-73.15(1) or 73.15(2) (prior to 1.1.1981 }-"Stainless 
steel circles''--Classification of-Held : Classifiable under Tariff Heading C 
73.15(1) and' not under Taiiff Heading 73.15(2}-These were not covered by 
the tenn "sheet" occuning in Note l(n) to Ch. 73 and Tariff Heading 73.13. 
Refund of duty-Claim-Procedure for-Held : To be processed in 
accordance with the ratio of Mafatlal Industries' case. 
Interpretation of Statutes : 
Taxing Statutes-Inte1pretation of-Held : Benefit of doubt relating to 
interpretation must go to the taxpayer. 
Words and Phrases : 
"Sheet"-Meaning of-Jn the context of-Note 1 (n) to Chapter 73 of 
the Customs Tariff Act, 1975. 
D 
E 
The appellants imported stainless steel circles for which customs 
duty was levied under customs Tariff Heading 73.15(2). The appellants F 
contended that the said stainless steel circles were classifiable under Tariff · 
Entry 73.15(1). The Customs, Excise and Gold (Control) Appellate 
Tribunal rejected the appellant's contention. Hence this appeal. 
On behalf of the respondent-Revenue it was contended that a circle G 
is nothing but a "sheet" which was cut to a non-rectangular shape within 
the meaning of Note l(n) to Chapter 73 of the Customs Tariff Act, 1975; 
the same would, therefore, be covered by Heading 73.13. and that in 
sub-heading 73.15(2) "sheet" would also cover a circle. 
Allowing the appeal, this Court 
343 
H 
A 
B 
344 
SUPREME COURT REPORTS 
(1997) 3 S.C.R. 
HELD : 1.1. A sheet is basically a very thin and broad piece of any 
substance normally of a regular shape. Hence, Note l(n) to Chapter 73 of 
the Customs Tariff Act, 1975 expressly includes a sheet cut into a non-rec· 
tangular shape. A stainless steel circle has a distinct shape and form of 
its own quite different from a sheet. [347-H) 
Webster's Comprehe11sive Dictio11ary, referred to. 
1.2. Since forms, which are not specifically set out in Tariff Heading 
73.15(2), will have to be classified under 73.15(1), circles of stainless steel 
will have to be classified under Heading 73.15(1). Note l(n) does not 
C provide much assistance in this connection. In respect of Heading 73.13, 
which deals with sheets and plates, the Note says that sheets or plates, 
which have been cut to non-rectangular shapes, will also be classified as 
sheets, or plates. But when stainless steel is in the form of a circle, it 
assumes a specific form and it cannot be treated if merely as a stainless 
steel sheet, which has been cut to a non-rectangular shape. It has a specific 
D form of its own. [348-E-F) 
1.3. The Customs Tariff Amendment Act of 1982 whereby angle, 
shapes, sections and circles of stainless steel are added to Tariff Heading 
73.15(2) is given retrospective•effect from 1.1.1981. Therefore, prior to 
E 1.1.1981 angles, shapes, sections and circles of stainless steel were not 
covered under Sub-heading (2) of Hi;_ading 73.15. It is a well-established 
principle of interpretation of taxing statutes that the benefit of any doubt 
relating to interpretation must go to the taxpayer. [349-A-B] 
Ve11kateshwara Stai11less Steel & Wire l11dust1ies v. Union of I11dia, 
F 
(1991) 53 ELT 312 (Mad.), approved. 
Super Traders & A11r. v. U11ion of India, (1983) ELT 258 (Del.), 
overruled. 
2. Refund applications by the assessees have to be processed in 
G accordance with the ratio of Maf atlal Industries case. [349-G) 
Mafatlal Industries Ltd. v. Union of India, (1996) 9 SCALE 457, 
referred to. 
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 1,744-45 
H of 1988 Etc. 
j 
, 
CHHEDA INDS. v. COLLECTOR OF CUSTOMS [MRS. S. V. MANOHAR, J.] 345 
From the Judgment and Order dated 23.12.86 of the Customs Excise A 
and Gold. (Control) Appellate Tribunal, New Delhi in A. No. 896 and 1100 
of 1981-B2 (Order No. 1344-45 of 1986-B2) 
N.D. Garg for the Appellant. 
N.K. Bajaj, S.A. Matto, V.K. Verma and P. Parmeswaran for the B 
Respondents. 
The Judgment of the Court was delivered by 
MRS. SUJATA V. MANOHAR, J. The appellants in Civil Appeal C 
Nos. 1744-45 of 1988 are importers of stainless steel circles. The appellants 
have filed the present appeals against an order of the Customs, Excise, and 
Gold (Control) Appellate Tribunal holding that stainless steel circles im-
ported by the appellants are classifiable under Customs Tariff Entry 
73.15(2) instead under Tarif
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