2002 (4) TMI 52 - SC - Customs

Appeal dismissed: Karbate tubes of artificial graphite with phenolic resin classifiable under Tariff Act sub-heading 6815.10, not 8419.50

SC dismissed the appeal, holding the Karbate Tubes made of artificial graphite impregnated with phenolic resin are classifiable under Tariff Act ... Classification under Customs Tariff - Exclusion by Note 1(a) of Chapter 84 - ejusdem generis - Statutory interpretation - plain and ordinary meaning - Harmonized System Nomenclature (HSN)Classification under Customs Tariff - Exclusion by Note 1(a) of Chapter 84 - Harmonized System Nomenclature (HSN) - Karbate Tubes made of artificial graphite impregnated with phenolic resin are classifiable under Chapter 68 sub-heading 6815.10 and are not to be included as parts of heat-exchangers under Chapter 84 by reason of Note 1(a). - HELD THAT: - The Tribunal's factual and classificatory conclusion that the Karbate Tubes are non-electrical articles of graphite falling within Heading 68.15 and sub-heading 6815.10 was upheld. The Court found that Note 1(a) of Chapter 84 - excluding 'Millstones, grindstones or other articles of Chapter 68' from Chapter 84 - must be given its plain and ordinary meaning and cannot be read down to cover only millstones and grindstones in Heading 6804; the expression 'other articles of Chapter 68' is deliberate and distinct from expressions such as 'similar' or 'and the like' used elsewhere, and the language cannot be altered by judicial construction. The rule of ejusdem generis was considered and rejected: Note 1(a) does not present a specific genus followed by general words such that the general words should be confined to the narrower genus, and therefore the ejusdem generis principle has no application. The Court applied established principles of statutory interpretation that no word should be treated as redundant and that where legislative language is clear there is no scope for importing or substituting words. Having accepted the Tribunal's application of the HSN and the textual construction of the exclusion, the Court concluded that the goods are not classifiable under Chapter 84 and affirmed classification under Chapter 68. [Paras 6, 7, 8, 10, 11]Appeal dismissed; classification under sub-heading 6815.10 affirmed and Note 1(a) construed according to its plain language, with the rule of ejusdem generis held inapplicable.Final Conclusion: The appeal is dismissed. The Karbate Tubes are classifiable as non-electrical articles of graphite under sub-heading 6815.10; Note 1(a) of Chapter 84 excludes articles of Chapter 68 by its plain language and the ejusdem generis rule does not restrict that exclusion. Issues Involved:1. Classification of Karbate Tubes under the Customs Tariff Act.2. Interpretation of Note 1(a) of Chapter 84.3. Application of the ejusdem generis principle.Detailed Analysis:1. Classification of Karbate Tubes under the Customs Tariff Act:The central question was whether Karbate Tubes made of artificial graphite impregnated with Phenolic resin, which are parts of Heat exchangers, should be classified under Tariff Item: sub-heading 6815.10 in the First Schedule of the Customs Tariff Act, 1975, as held by the Revenue, or under sub-heading 8419.50 as claimed by the assessee-importer. The Assistant Collector of Customs classified the goods under Chapter Heading 68.15 and sub-headings 6815.10, confirming the demand raised by the Appraiser. The Collector (Appeals) and the Customs, Excise and Gold Control Appellate Tribunal (Tribunal) upheld this classification. The Tribunal referred to the Harmonized System Nomenclature (HSN) and observed that Karbate Tubes made of artificial graphite, being non-electric articles made of graphite, fall under Chapter sub-heading 6815.10. Despite being parts of machinery that might otherwise attract sub-heading 8419.50, the exclusion in Note 1(a) of Chapter 84 applied.2. Interpretation of Note 1(a) of Chapter 84:The assessee argued that the tubes should be classified under Chapter 84 as parts of Heat exchangers and are not excluded by Note 1(a) of Chapter 84. They contended that Note 1(a) should only apply to articles similar to millstones or grindstones. The Revenue countered that the language of the provision is clear and should not be transformed by adding or deleting words. The Court noted that Note 1(a) of Chapter 84 excludes 'Millstones, grindstones or other articles of Chapter 68' from Chapter 84. The Court emphasized that no words in a statute are redundant or superfluous, and each word must be interpreted in context. The construction that requires adding or substituting words should be avoided.3. Application of the ejusdem generis principle:The assessee argued that the expression 'other articles of Chapter 68' in Note 1(a) should take color from 'millstones, grindstones,' applying the ejusdem generis principle. The Court explained that the rule applies when specific words are followed by general words, limiting the general words to things of the same kind. However, Note 1(a) does not enumerate a class or category followed by general words; it is clear and unambiguous, thus not invoking the ejusdem generis principle. The Court cited various precedents and principles of statutory interpretation, emphasizing that where the language is clear, the intention of the legislature must be gathered from the language used without adding or altering words.Conclusion:The Court concluded that the appeal lacked merit and dismissed it, upholding the classification of Karbate Tubes under sub-heading 6815.10. The interpretation of Note 1(a) of Chapter 84 did not support the application of the ejusdem generis principle, and the language of the statute was clear and unambiguous in excluding the articles in question from Chapter 84.