M/S. STP LIMITED versus CONTROLLER OF CENTRAL EXCISE, PATNA AND ORS.

Citation: [1997] SUPP. 6 S.C.R. 56 · Decided: 02-12-1997 · Supreme Court of India · Bench: S.P. BHARUCHA · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
B 
c 
MIS. STP LIMITED 
v. 
CONTROLLER OF CENTRAL EXCISE, PATNA AND ORS. 
DECEMBER 2, 1997 
[S.P. BHARUCHA AND SUHAS C. SEN, JJ.] 
Central Excise Taliff, T.I. 11 (5)--'Tar'-Whether includes partially dis-
tilled tar and blends of pitch----Held, yes-Central Excise Rules 1944, Rule 
8(1). 
lnte1pretation of Statutes-Taxing Statutr:-Doubt in constrnction of 
provision of a taxing statutr:-Held, must be resolved in favour of assessee. 
The appellant, which produced PCM, claimed exemption from pay-
ment of excise duty under a notification which, inter alia, wholly exempted 
D tar products falling under Tariff Item (T.I.) 11 (5) of the Central Excise 
Tariff. The respondent contended that the appellant manufactured various 
types of pitch which did not come within the ambit of T.J. 11(5). 
Although the Tribunal accepted the appellant's contention in rela-
tion to some of the products, it denied relief in relation to certain others 
E 
by relying on its earlier decision where it was held that the products were 
classifiable under serial Nos. 3 to 8 of T.I. 68. 
F 
Allowing the appeal, this Court 
HELD : 1.1. "Tar" in clause (5) of T.I. 11 had been given an expanded 
definition. Tar distilled from coal or lignite or any other mineral would 
come within the ambit of this definition. The inclusive clause, thereafter, 
extended the definition to partially distilled tars and blends of pitch with 
creosote oils or with other tar distillation products. Pitch was brought 
about by distillation of tar. [61-A-B] 
Indian Aluminum Co. Ltd. v. Collector of Custon~s, Cochin, (1988) 38 
G ELT 69 (Tribunal); Steel Authodty of India Limited v. Collector of Excise, . 
Bolpw; West Bengal, (1997) 91 ELT 529 S.C., referred to. 
1.2. By distillation of coal tar a type of pitch was obtained. That had 
to come within the phrase 'tar distillation product'. [61-D] 
H 
Webster Comprehensive Dictionary, International Edition, referred to. 
56 
-
STPLTD. v. C.C.E.[SEN,J.) 
57 
2. If there was any doubt in the construction of any provisions of a A 
taxing statute, that doubt to be resolved in favour of the assessee. [61-D] 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3234 of 
1991. 
From the Judgment and Order dated 21.6.90 of the Customs, Excise 
and Gold (Control), Appellate Tribunal, New Delhi in A. No. E/A. No. 
424 of 86-C (Order No. 653/90-C). 
S.C. Birla, Subrat Birla and Ms. Vipin Gupta for the Appellant. 
K.N. Bhat, Additional Solicitor General, K.N. Bajpai, R.N. Verma 
and V.K. Verma for the Respondents. 
The Judgment of the Court was delivered by 
SEN, J. The appellant is a Company engaged in manufacture of coal 
tar products. An exemption notification was issued by the Central Govern-
ment exempting tar falling under Tariff Item 11 of Central Excise Tariff 
from the whole of excise duty leviable thereon. Tariff Item No. 11 is : 
Item 
Description of Goods 
Rate of duty 
No. 
11. 
COAL (EXCLUDING 
LIGNITE) AND COKE 
ALL 
SORTS, 
INCLUDING CALCINED 
PETROLEUM COKE : 
ASPHALT, BITUMEN 
AND TAR-
(1) 
Coal and coke not else - Ten rupees per metric 
where specified 
tonne. 
(2) 
Petroleum coke, other than Twenty per cent ad valorem 
calcined petroleum coke. 
plus two thousand rupees 
per metric tonne. 
(3) 
Calclined petroleum coke. 
Twenty per cent ad valorem 
B 
c 
D 
E 
F 
G 
H 
A 
B 
c 
D 
E 
58 
SUPREMECOURTREPORTS [1997)SUPP.6S.C.R. 
(4) 
Asphalt 
and bitumen Two hundred rupees per 
(including cutback bitumen metric tonne. 
and asphalt) natural or 
produced from petroleum 
or shale. 
(5) 
Tar distilled from coal or One hundred rupees per 
lignite and other mineral metric tonne. 
tars, including partially 
. distilled tars and blends of 
pitch with creosote oils or 
with other tar distillation 
products. 
The Exemption notification is as follows : 
"Tar is exempt from duty 
TAR 
121/62-CE. dt.13.6.62 
In exercise of the powers conferred by Rule 8 (1) of the Central 
Excise Rules, 1944, the Central Government hereby exempts Tar falling 
under Item 11 with effect from the 24th April 1962, from the whole of the 
excise duty leviable thereon." 
The appellant's ease before the excise authority was that its products 
were fully exempt from excise duty by virtue of the above notification. The 
F 
case of the Department on the other hand, is that the goods manufactured 
by the appellant did not come within the ambit of Tariff Item 11. Therefore, 
there is no question of granting any exemption from excise duty to these 
products. The dispute ul

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