1. In these appeals common question of law and facts involved, hence they are taken up for disposal together. The question that arises for consideration is as to whether the appellants are entitled to the benefit of Notification No. 220-Cus., dated 10-11-1978 which grants benefit of exemption under Sub-section (1) of Section 25 of Customs Act to the product "insulated copper wire thinner than 44 S.W.G." falling under Heading No. 85.44 of the First Schedule of the Customs Tariff Act when imported into India, from - (a) so much of that portion of the duty of customs leviable thereon, which is specified in the said First Schedule, as is in excess of 40% ad valorem; and (b) the whole of the additional duty leviable thereon under Section 3 of the second mentioned Act.
Explanation : In this notification, the abbreviation "S.W.G." means Standard Wire Gauge which is used for measuring diameter.
2. There is no dispute in these appeals on any of the matters pertaining to the wire being thinner than 44 S.W.G. or about its classification under Heading No. 85.44. The short point on which the Commissioner has rejected the benefit is the interpretation placed by him on the term "wire" appearing in Notification to mean only single strand of wire and not two wires. He has held that when there are more than one strand of wire it becomes cable and Notification exempts only insulated (single) wire and not wires and hence the benefit cannot be granted.
3. Ld. Consultant appearing for the appellants points out to the Order itself wherein the Commissioner has noted the notes appearing in explanatory notes H.S.N. under Heading 85.44 which clarified that insulated wires and cables may be in the form of (i) Single or multiple strand insulated wire, (ii) two or more such insulated wires stringed together and (iii) two or more insulated wires assembled together in a common insulating sheath. Ld. Counsel submits that the Department has been accepting the wires which are sheathed with insulations and termed as cables as also wires for the purpose of notification and this regard, he relied on the orders passed by Commissioner (Appeals) in Order-in-Appeal dated 7-2-1989 in Appeal Cus-452/89 in the appellant's own case and also in M-CUS-220.
He submitted that the Department has not preferred any appeal against these orders. Ld. Advocate also points out that there is also test results obtained from Test house which has clearly noted that the item in question satisfies the criteria of the Notification. He also points out that the Commissioner has proceeded in the present case on a material obtained from Bureau of Indian Standards which has given merely common opinion on the subject of wire and cables. Consultant submits that this material was never placed and it cannot be considered for the purpose of interpreting the Notification.
4. Ld. D.R. submits that there is no res judicata in taxation matters and where in case of 2 opinions, 2 different Commissioners (Appeals) have accepted their plea, it does not mean that 3rd Commissioner should also follow a similar order.
5. On a careful consideration of the submissions, we notice that the issue is in a restricted scope in as much as to whether the bunch of wires in the form of cable would also be entitled to the benefit of the Notification in question. Each of the strand of wire in the cable satisfies the criteria laid down in the Notification and to this extent, the test results are in favour of the appellants. Further, it is seen from the explanatory notes of H.S.N. figuring at page No. 1404 :- "The insulated wires cables etc. of this heading may be in the form of - (iii) Two or more such insulated wires assembled together in a common insulating sheath".
It is evident from the above clarification that both wire and cable can have the same physical characteristics. So long as the notification grants the benefit to insulated copper wire thinner than 44 SWG falling under Heading 85.44, it follows that if the wires are bunched together in the form of a cable that by itself will not be a ground for denying the exemption. We notice that there is a practices in the Customs House as can be seen from the two orders of Commissioner (Appeals) referred to, to grant the benefit. Commissioner (Appeals) passed the orders in the appellant's own case. There was no reason to have taken a different view in the light of the explanatory notes which states that the wire falling under Heading 85.44 include 'single strand or single or multiple strand insulated wires'. It also explains that two or more such insulated wires assembled together in a common insulating sheath H.S.N. could also be considered as insulated wires. In view of this explanatory notes, where wires thinner than 44 SWG are single or multiple strand insulated wires assembled together in a common insulating sheath, they would still be considered as a wire for the purpose of Heading 85.44. The said explanatory notes have a bearing for interpreting the terms in the Notification. A different view would make the notification Otiose.
The Notification has to be read in such a way as it should not make it otiose. Further, the Consultant's plea that the Commissioner is guided by some material which was not on records as pointed out by the appellants is also an acceptable proposition. We notice that an opinion from the Bureau of Indian Standards has been relied. It does not deal with the question in issue but only gives an opinion on the calculation of thickness of the cables consisting of multiple strands of wires.
They have stated that conductors are specified or their diameters in metric units only in Indian Standards specifications. They further stated that when cable is composed of a number of strand of wires, the area of cable is declared and the practice is to work backwards to determine the diameter of the cable as per Indian Standards. This is not done by multiplying the individual wire diameters with the number of strands. There are tractors; like lay length, the pitch, air gaps that influence the overall diameter and the construction is achieved by stranding of conductors. The diameter of the cable obtained by working from the area is only calculated value. It is not possible to obtain the overall diameter to an actual measurement due to the above mentioned influencing factors. Lastly, the gauge number applies only to individual wires, rods and not to bunch or stranded conductors.
Therefore from the reading of this opinion, it is clear that Bureau of Indian Standards does not deal with the issue in question pertaining to the single strand being less that 44 SWG for the purpose of grant of exemption in terms of the Notification. Hence this opinion is also not material for the purpose of deciding the issue of grant of Notification. The Department themselves had referred the matter to their test house and the test house after a test have clearly certified that the wire is thinner than 50 SWG by reported dated 22-11-1991.
Therefore, this material which is in favour of the appellants cannot be rejected in favour of an opinion of Bureau of Indian Standards. It was not even relied by the Department in the show cause notice or which was a subject matter of adjudication.
6. In that view of the matter, the reliance on explanatory notes to explain that wire, cables; single or multiple strands should be accepted for the purpose of understanding the terms in the Notification and on such understanding, the benefit of the Notification is required to be extended. Therefore, the impugned order is set aside and the appeals allowed.