M/S. THE INDIAN CABLE CO., LTD. CALCUTTA versus COLLECTOR OF CENTRAL EXCISE, CALCUTTA AND ORS..

Citation: [1994] SUPP. 3 S.C.R. 678 · Decided: 20-09-1994 · Supreme Court of India · Bench: B.P. JEEVAN REDDY · Disposal: Disposed off

Judgment (excerpt)

A 
B 
MIS. THE INDIAN CABLE CO., LTD. CALCUITA 
v. 
COLLECTOR OF CENTRAL EXCISE, CALCUITA AND ORS. 
SEPTEMBER 20, 1994 
[B.P. JEEVAN REDDY, SUHAS C. SEN AND 
K.S. PARIPOORNAN, JJ.) 
Central Excises and Salt Ac~ 1944/Central Excise Rules, 1944-Ss. 2(d), 
2(f)/Rule JO-Classification under item 15A(l)(ii)--PVC compound 
C produced from out of duty paid PVC resin-Levy of duty treating it as a 
different product having different use-Validity of-Processes undertaken to 
produce PVC compound-Whether amounts to manufacture-''Manufac-
ture'L....!'Marketability''- "Excisable goods''-Meaning of. 
D 
Words & Phrases : 
''Manufacture''-"Excisable goods''-"Marketability''-Meaning of in the 
context of Central Excises and Salt Act, 1944. 
The appellant-assessee was producing PVC compound from out of 
E 
the duty paid PVC resin. The Assistant Collector of Central Excise held 
that the PVC compound in the form of granules produced by the assessee 
was exigible to duty under Rule 10 of the Central Excise Rules, 1944. He 
allowed set off in respect of the duty paid on PVC resins used in the 
production of PVC compound. 
F 
In appeal, the Appellate Collector held that the assessee manufac-
tured PVC compound (granule) for insulation of their products viz., 
electric wires and cables and the resultant PVC compound is a new 
product having different use than that of PVC resins and so the process 
undertaken by the assessee amounted to manufacture within the meaning 
of S.2(f) of the Central Excises and Salt Act, 1944. He, therefore, held that 
G PVC compound would fall under sub-item (ii) or item lSA(l) and excise 
duty was accordingly leviable. 
In second appeal, the Customs, Excise & Gold (control) Appellate 
Tribunal by a majority ~ecision upheld the order of the Appellate Collec-
H tor. Against this order, the assessee preferred the present appeal. 
678 
INDIAN CABLE v. COLLECTOR OF C. EXCtSE 
679 
The assessee contended that the PVC compound or granules A 
produced out of duty paid PVC resins is only a modified form of PVC 
resins and the same cannot be called different goods commercially; nor is 
it a marketable commodity. It was also contende_lf Jhat even if the process 
employed by the assessee amounts to "manufacturer" within the meaning 
of S.2(t) of the Act, it would not attract excise duty unless it was further 
found out that the commodity is a marketable commodity. 
Revenue contended that the PVC compound manufactured by the 
assessee, being a distinct and different commercial product and 
marketable as such, excise duty ~ould be levied on the same. 
Remitting the matter to the Customs Excise and Gold(Control) 
Tribunal, this Court 
B 
c 
HELD : 1. Though the majority of the members of the Tribunal held 
that the process employed by the appellants amounts to "manufacture" 
within the meaning of Section 2(1) of the Act, the dissenting Judicial Mem-
D 
her held that it was not. At this stage, this Court need not pronounce on the 
correctness or otherwise of the rival views so expressed by the members. of 
the Tribunal, since the matter requires a remit for other reasons. But in 
construing the relevant item or entry, in fiscal statutes, if it is one of 
everyday use, the concerned authority must nonnally construe it, as to how E 
it is understood in common parlance or in the commercial world or trade 
circles. It must be given its popular meaning. Nor should the entry be 
understood in any technical or botanical or scientific sense. In the case of 
technical words, it may call for a different approach. [685-D to G] 
Unwin v. Hanson, [1891) 2 QB 115, at 119, referred to. 
F 
New Encyclopaedia Britannica Vol. 21 PP. 290-292 and Mcgraw-Hill 
Encyclopedia of Science & Technology, 7th Edn., PP 182-184, referred to. 
2. "Marketability" is a decisive te.st for dutiability. It .only means G 
"saleable", or "suitable for sale". It need not be in fact, "marketed". The 
article should be, capable or being sold or being solcl, to consumers in the 
market, at it is without anything more. The Tribunal has not adverted to 
the above vitai. aspects nor has it entered a finding that the PVC compound 
(granules) is a "marketable product" as understood in law. The Tribunal 
was swayed by the fact that the conversion of PVC resin into PVC com- H 
680 
. SUPREME COURT REPORTS (1994) SUPP. 3 S.C.R. 
A 
pound by the process employed by the appellants amounts to "manufac-
ture" within the meaning of Section 2(t) of the Act and that by_itself will 
ju

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