COLLECTOR OF CENTRAL EXCISE, KANPUR versus KRISHNA CARBON PAPER CO.

Citation: [1988] SUPP. 3 S.C.R. 12 · Decided: 16-09-1988 · Supreme Court of India · Bench: SABYASACHI MUKHERJI · Disposal: Disposed off

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Judgment (excerpt)

A 
COLLECTOR OF CENTRAL EXCISE, KANPUR 
v. 
KRISHNA CARBON PAPER CO. 
SEPTEMBER 16, 1988 
B 
[SABYASACHI MUKHARJI AND S. RANGANATHAN, JJ.] 
Central Excises and Salt Act, 1944: Section II-A-Central Excise 
Tariff-Items 17(2), 17(3) and 68-Carbon paper whether included in 
the description 'paper subjected to coating'. 
C 
Construction of Statutes: Language in a taxing statute to be 
construed in popular sense as understood by that particular trade and 
not in strict technical sense. 
The respondent-company was engaged in the manufacture of 
Carbon Paper. It was served with a notice demanding central excise 
D duty on carbon papers cleared from its factory during the period 
25.3.1979 to 24.9.1979 under section Il-B of the Central Excises and 
Salt Act, 1944. The respondent stated in reply that the notice was 
without jurisdiction because it was only after 28.2.1982 that the product 
was subjected to duty under sub-item (3) of item 17 of the Central 
Excise Tariff. The Assistant Collector of Central Excise, confirmed the 
£ demand. The Appellate Collector, however, accepted the respondent's 
contention. The Collector (Appeals) and the Appellate Tribunal dismis-
sed the Revenue's appeals. The Tribunal upheld the contention of the 
respondent that for the period before its amendment in 1982, carbon 
paper fell under Tariff item 68 and not under Tariff Item 17(2), as was 
contended by the Revenue. 
F 
Before this Court the Revenue contends that (1) carbon paper 
being akin to coated paper was covered since 1976 under sub-item (2) of 
item 17 of the Central Excise. Tariff which included paper which had 
been subjected to coating; (2) the introduction of specific name 'carbon 
paper' as sub-item (J) oHtem i7 in 1982 was with a view to subject it to 
G a different rate of duty; and (3) the amendment so far as item 17(3) was 
concerned was mere clariflcatory and was introduced ex abundanti 
cautela. The respondent, on the other hand, contends that if carbon 
paper was already included then there was no purpose of introducing 
these subsequent amendments. 
H 
Disposing of the appeal, it was, 
12 
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COLLECTOR OF CENTRAL EXCISE v. KRISHNA PAPER 
13 
HELD: (I) Where no definition is provided in the statute itself for 
ascertaining !Re correct meaning of a fiscal entry, reference to a dictio· 
nary is not always safe. The correct guide is the context and the trade 
meaning, which is prevalent in that particular trade where that goods i• 
known or traded. [21D-EJ 
(2) If a statute contains language which is capable of being 
construed in a popular sense, such a statute is not to be construed 
according to the strict or technical meaning of the language contained in 
it, but is to be construed in its popular sense, meaning, of course, by the 
words "11opular sense" that which peoi>le conversant with the subject-
matter with which the statute is dealing would attribute to it. The 
ordinary words in every day use are, therefore, to be construed accord-
ing to their popular sense. [23F-G] 
(3) Paper simpliciter cannot include' carbon paper because that 
would not be in consonance with the popular understanding of the 
expression "paper". l23G-H; 24A] 
(4) Where paper of a snecial type defined in the particular statute 
as one including paper which have been subjected to various treatments 
such as coating, impregnating, how that paper be understood, there 
must be evidence of that understanding. [24AJ 
A 
B 
c 
.i:> 
(5) There is authority of the Indian Standards Institute's pub-
E 
lication "Glossary of Terms used in Paper Trade and Industry" to 
the effect that carbon paper is understood as a coated paper in 
trade. [23A-C] 
(6) The trade notices and the,_tariff advices issued by the Board 
are not relevant, as such, in construing items in Tariff Schedule. [24E-F] 
p 
(7) Understood in the accepted notion of construing entries of 
fiscal Statute not from a technical or scientific point of view hut from 
the point of view of the people in the trade dealing with that particular 
type of goods and having regard to the evidence of the Indian Standards 
Institute and in the absence of any other evidence to the contrary, on G 
the basis of the definition of paper or it was in the year 1976, carbon 
paper would come within item 17(2) of the Tariff Items, and would not 
fall into the residuary entry. [23B-C J 
Sai Giridhara Supply Co. v. Collector of Central Excise, 
Bombay, [1987] 23 E.L.T. 438 Tribunal; Commissioner of Sales Tax

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