Union of India (Uoi) and ors. Vs. Mahindra and Mahindra Ltd. - Court Judgment

Excerpt:
classification - equipment (pattern) is integral part of machine for forming foundry moulds of sand. falls under cta: h. 84.56. specific heading applicable; hence cannot fall under general heading. - code of criminal procedure, 1973 [c.a. no. 2/1974]. section 41: [ swatanter kumar, cj, smt ranjana desai & d.b. bhosale, jj] arrest of accused - held, a police officer or a person empowered to arrest may arrest a person without intervention of the court subject to the limitations specified under the provisions of the code. the provisions of section 41 of the code provides for arrest by a police officer without an order from a magistrate and without a warrant. a distinct and different power under section 44 of the code empowers the magistrate to arrest or order any person to arrest the offender. under section 44 of the code, that power is vested in the court of the magistrate when an offence is committed in his presence. if the legislature has taken care of providing such specific power under section 44 of the code, then there could be no reason for such a power not to be specified under the provisions of chapter xii of the code. in terms of section 41, a police officer may arrest a person without a warrant or order from the magistrate for any or all of the conditions specified in that provision. language of this provision clearly suggested that the police officer can arrest a person without an order from the magistrate. thus, there appears to be no reason why on the strength of section 156(3) of the code, any restriction should be read into the power specifically granted by the legislature to the police officer. of course, freedom of investigation is the essence of these provisions but in order to suppress the mischief it is sufficiently indicated under different provisions of the code that the arresting officer should exercise his power or discretion judiciously and should be free of motive. some kind of inbuilt safeguard is available to the accused in the cases where the magistrate directs investigation under section 156 (3) of the code by taking recourse to the provisions of section 438 of the code by approaching the court of session or the high court for such relief. thus, during the course of investigation of a criminal case, an accused is not remediless and that would further buttress the above view. [jagannath singh v dr. ajay upadyay & anr 2006 cri lj 4274; 2006 (5) air bom r held per incuriam]. - roy, 1966crilj1538 ,the supreme court has observed at page 1998. it is a well recognised principle in dealing with matters of construction that subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon the earlier act where the earlier act is obscure or ambiguous or readily capable of more than one interpretation'.in the present case, in our view, the entries by themselves are not at all ambiguous. the section notes and the entry read together clearly lead to the conclusion that pattern equipment forms a part of the machine for forming foundry moulds of sand.sujata manohar, j.1. the appellants are the original respondents. they are hereinafter referred to as the respondents. the respondents to the appeal are the original petitioners. they are hereinafter referred to as the petitioners.2. the petitioners are engaged, inter alia, in the manufacture of jeeps, tractors and similar vehicles. in the course of manufacture the petitioners are required to make certain engine parts. the parts in question are cast by pouring molten metal into sand moulds. the sand moulds for these parts are prepared by the petitioners with the help of machines known as jolt and squeeze machines. the pattern for the mould is first mounted on the jolt and squeeze machine. a moulding box is mounted around the pattern and sand is poured over the pattern. this sand is squeezed by the jolt and squeeze machine for the purpose of producing the sand moulds for making these engine parts.3. the patterns and allied equipment in the present case are made of an aluminum alloy. the life of the pattern equipment is generally 2 to 5 years and one set of pattern equipment can be used for making around 30,000 to 50,000 sand moulds. in the month of january 1978 the petitioners imported two consignments of pattern equipment for their engine parts. the respondents assessed these pattern equipment to customs duty and countervailing duty under tariff entry 76.08/16 of the first schedule to the customs tariff act, 1975. the respondents also assessed countervailing duty on this import by applying the rates under item 27 of the central excise tariff. the petitioners objected to the computation of customs duty and countervailing duty.4. according to the petitioners, the equipment imported by them was assessable under tariff entry 84.60 as then in force or in the alternative under tariff entry 84.56. the contentions of the petitioners were negatived. these contentions were also negatived in appeal and in revision. hence the petitioners filed the present petition. in the meantime, in respect of certain subsequent consignments, countervailing duty was charged by the collector under item 68 of the central excise tariff. the respondents have, very fairly, accepted the position that countervailing duty in respect of the consignments in question is also assessable under item 68 of the central excise tariff. in view of this acceptance the dispute relating to countervailing duty does not survive before us.5. in order to understand the controversy between the parties, it is necessary to set out the relevant tariff entries as prevailing at the material time. entry 76.08/16 is as follows :heading sub-heading no. rate of duty durationno. and description stand- prefer- when rates ofof article ard entail duty are protect areas tive(1) (2) (3) (4) (5)76.08/16 other articles 60% - -of aluminumthis entry forms part of chapter 76 in section xv. chapter 76 deals with aluminum and articles thereof.6. entries 84.56 and 84.60 form part of chapter 84 in section xvi. section xvi deals with machinery and mechanical appliances; electrical equipment; parts thereof. section note 2 states inter alia that parts of machines not being parts of the articles described in headings nos. 84.64, 85.23, 85.24, 85.25 and 85.27 are to be classified according to the rules set out there. one such rule is that the parts, if suitable for use solely or principally with a particular kind of machine are to be classified with the machines of that kind. section note 5 states that for the purposes of these notes, 'machine' means any machine, apparatus or appliance of a kind falling within section xvi. tariff entry 84.56 in so far as it is relevant for the present purpose reads as follows :'machinery for sorting screening, ......................... machines for forming foundry moulds of sand.standard rate of duty 40%'the relevant part of entry 84.60 is as follows :'moulding boxes for metal ........standard rate of duty 40%'7. the petitioners contend that pattern equipment imported by them forms a part of machines for forming foundry moulds of sand and hence it will fall under entry 84.56 in view of section note 2 of section xvi of chapter 82. in the alternative they contend that the term 'machine' is used in a wide sense in this section to include any apparatus or appliance also. in this sense pattern equipment can also be looked upon as a machine for forming foundry moulds of sand. the petitioners had contended before the customs authorities that in the alternative pattern equipment can be classified under tariff entry 84.60 as part of moulding boxes for metal foundry. the petitioners have, however, not pressed this submission before us. the respondents on the other hand contend that pattern equipment cannot be classified either under tariff entry 84.56 or 84.60. according to them it must be classified on the basis of its constituent viz., aluminum. hence they have classified it under the heading 'other articles of aluminum' under tariff entry 76.08/16.8. the learned single judge of this court by his judgment and order dated 6th/7th april, 1984 has rejected the contention of the respondents. he has held that the relevant entry which is applicable is 84.56 and has allowed the petition on that basis. the present appeal is preferred by the original respondents from this judgment and order of the learned single judge.9. the question that we have to consider is whether the pattern or the pattern equipment can, in the first place, be considered as part of a machine for forming foundry moulds of sand. there is no dispute that for the purpose of constructing the moulds of sand in question, which are required for manufacturing the engine parts, the equipment which is required is a jolt and squeeze machine, the pattern of the mould which is to be formed and the moulding box in which the sand required for the sand mould is to be poured. this equipment used together produces the moulds of sand in question. the jolt and squeeze machine by itself without the pattern equipment cannot produce the moulds of sand in question. the petitioners have also pointed out that the pattern equipment has to be manufactured to function with the type of jolt and squeeze machine being used with it and the pattern equipment works with the type of machine for which it is designed. without such pattern equipment the jolt and squeeze machine cannot produce the sand moulds which are required for the parts in question. therefore, the jolt and squeeze machine, the pattern equipment and the moulding box form a composite equipment for forming foundry moulds of sand. the learned judge was right when he said that the pattern equipment must, therefore, be classified under tariff item 84.56, which was in force at the relevant time.10. in the alternative the petitioners have submitted that the pattern equipment itself can be considered as a machine because the term `machine' in this section is used in a wide sense so as to include apparatus and appliances. pattern equipment is an apparatus designed for producing moulds of sand. it can, therefore, be considered as a machine for forming foundry moulds of sand and would fall under tariff item 84.56. we need not consider this aspect of the submission because, in any event, according to us, the pattern equipment forms an integral part of a machine for forming foundry moulds of sand.11. it was pointed out by mr. s.m. shah, learned counsel for the respondents, that the pattern equipment is imported separately. a jolt and squeeze machine does not come with the pattern equipment. hence pattern equipment is not a part of the jolt and squeeze machine. it should not, therefore, be treated as falling under tariff item 84.56. it is undoubtedly true that pattern equipment has to be designed separately and specially in order to produce moulds of the kind required by each user. but without the pattern equipment, a jolt and squeeze machine cannot produce foundry moulds of sand. therefore, the fact that the pattern equipment can be separately ordered will not be decisive. what we have to see is whether the machine can function without this essential equipment viz., pattern equipment. it is nobody's case that pattern equipment is equivalent to raw material. it must, therefore, be considered as a part of the machinery required for forming foundry moulds of sand. in this connection, the petitioners have relied upon the definition of 'machinery' as given by the privy council in the case of corporation of calcutta v. chairman of the cossipore, a.i.r. 1922 p.c. 27, and reproduced by the supreme court in commissioner of income tax, madras v. mir mohammad ali, a.i.r. 1964 s.c. 1693. these courts have said that the word `machinery' when used in ordinary language, prima facie, means some mechanical contrivances which, by themselves or in combination with one or more other mechanical contrivances, by the combined movement and interdependent operation of their respective parts generate power, or evoke, modify, apply or direct natural forces with the object in each case of effecting a definite and specific result. in this sense pattern equipment is an integral part of a machine for making foundry moulds of sand.12. mr. shah has, however, pointed out to us that in the statement of objects and reasons accompanying the customs tariff act, 1975, it is stated that the tariff revision committee had suggested that the import tariff schedule should be revised and based broadly on the brussels tariff nomenclature, making such contractions or expansions thereto as were necessary to suit the needs of india. with this view in mind, in the import tariff (schedule i) the description of articles is based on the brussels tariff nomenclature and so is the case with the export tariff (schedule ii). the financial memorandum which accompanies the statement of objects and reasons states in paragraph 3. 'one of the advantages of basing the customs tariff on the brussels tariff nomenclature is that there would be uniformity in the classification of the same article in different countries using that nomenclature. however, in order to ensure that there is such uniformity, it would be necessary to keep in touch with the central organisation responsible for the nomenclature, namely, the customs co-operation council, and to subscribe for the explanatory notes and other literature published by that organisation in connection with the nomenclature.'13. it is submitted by mr. shah that tariff entries 84.56 and 84.60 are identical with similar entries in the brussels tariff nomenclature. they also bear the same number in the brussels tariff nomenclature. however, in the brussels tariff nomenclature there are certain explanatory notes to explain the various headings. in respect of heading 84.56 there is a sub-heading to explain what is covered by 'machines for forming foundry moulds of sand'. it has also a separate sub-heading : (italics ours)'parts'. the note below it says, 'subject to the general provisions regarding the classification of parts (see general explanatory note to section xvi), parts of the machines of this heading are also classified here. .....'below that, in small print, there is a note which says 'the heading does not cover ..... (h) moulding boxes for iron foundry ; moulds for use in machines of the present heading (heading 84.60)'.14. under the heading 84.60 which deals with moulding boxes for metal foundry there is a note in small print at the end which says, inter alia, as follows :'apart from the exclusions previously mentioned, the heading also excludes : (a) foundry patterns; foundry cores; core boxes, moulding boards, pattern plates, etc., used in the preparation of sand moulds (classified according to their constituent material)'. (italics ours) mr. shah has strongly relied upon this note in support of his submission that patterns are not covered by either tariff entry 84.56 or 84.60. these are to be classified according to their constituent material.15. in our tariff, however, there is no such explanation either under tariff entry 84.56 or 84.60. it is undoubtedly true that when we adopt an international nomenclature, the interpretation of this nomenclature should, as far as possible, be in accordance with the prevailing international practice. the explanatory notes to brussels tariff nomenclature would, therefore, be of considerable persuasive value. but in the present case we have to consider some further events which have taken place. the brussels tariff nomenclature has been replaced as far back as in 1983 by the harmonised commodity description & coding system and the nomenclature as prescribed by the customs co-operation council. india is a signatory to this coding system since 1983. in consequence, by the customs tariff (amendment) act, 1985, the customs tariff act has been amended with effect from 24th january, 1986. under the new nomenclature, entry 84.80 deals, inter alia, with 'moulding boxes for metal foundry; mould bases : moulding patterns;'. entry 8480.30 expressly covers moulding patterns. in other words, under the new international nomenclature, it is now made clear that pattern equipment has to be treated as a machine or an apparatus and has to be classified in the same section as machinery and mechanical appliances and under the same category as moulding boxes for metal foundry. it cannot be considered as falling within an entry in the customs tariff depending upon its constituent material.16. in fact, as per the general principles of interpretation, when there is a specific entry which covers the item in question, the item cannot be classified under a more general entry. therefore in view of the nomenclature as now in force pattern equipment has been treated internationally also as an item of machinery or as a part of a machine. in view of this subsequent classification, the persuasive value of the explanatory notes to the old brussels tariff nomenclature loses much of its force. in state of bihar v. s.k. roy, : 1966crilj1538 , the supreme court has observed at page 1998. 'it is a well recognised principle in dealing with matters of construction that subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon the earlier act where the earlier act is obscure or ambiguous or readily capable of more than one interpretation'. in the present case, in our view, the entries by themselves are not at all ambiguous. the section notes and the entry read together clearly lead to the conclusion that pattern equipment forms a part of the machine for forming foundry moulds of sand.17. it was also pointed out by mr. korde, learned counsel for the petitioners, that prior to the coming into force of the customs tariff act, 1975 the same pattern equipment imported by the petitioners was classified under tariff entry 72(c) of the first schedule to the indian tariff act, 1934. entry 72(c) deals with 'apparatus and appliances, not to be operated by manual or animal labour, which are designed for use in an industrial system as parts indispensable for its operation and have been given for that purpose some special shape or quality which would not be essential for their use for any other purpose'. it is submitted that prior to coming into force of the customs tariff act, 1975 the same pattern equipment was classified as an apparatus or appliance by the customs authorities. after coming into force of the amended customs tariff also this pattern equipment is to be classified under the chapter dealing with machinery. it would be an anomaly if in the interregnum this equipment is to be classified as 'other articles of aluminum'. there is considerable force in this submission also.18. in our view, therefore, the learned judge was right in classifying the pattern equipment imported by the petitioners under tariff entry 84.56 and in granting the consequential reliefs to the petitioners. the appeal is, therefore, dismissed. in the circumstances there will be no order as to costs.