The Hindu Business Line : Can't blame the manufacturer if men used women's shirts

MOPEDS may be out of fashion on city roads, but the recent case of Balkrishna Industries Ltd that came before the Mumbai Customs, Excise and Service Tax Appellate Tribunal (CESTAT) was about a moped dispute.

The company manufactures tyres for two-wheelers, and these included moped tyres too, enjoying concessional rate of duty.

For the period in question, moped tyres carried a duty of Rs 29 while other two-wheeler tyres suffered Rs 40 as duty. Excise officials observed where all Balkrishna's tyres were going and alleged that the company was clearing "two-wheeled motor vehicle tyres meant for motorcycles claiming them to be moped tyres."

The company refuted the charges of mis-declaration and suppression of facts. Its tyres were single ply, said the company, whereas motorcycle tyres are "two-ply in construction and four-ply in bead region." It also embossed the words `moped' and `maximum speed 50 kmph' on every tyre.

The Department's representative, Mr A. Shukla, referred to information provided by Kinetic Engineering Ltd, one of the buyers of tyres from Balkrishna. Kinetic had stated that the tyres were sued for its kick-start vehicles.

"A kick-start vehicle cannot be a moped," he argued. "A moped is one that has a motorised pedal. In a kick-start vehicle motorised pedals are not provided."

These were motorcycles and not mopeds, said Mr Shukla. Thus, it was evident, he said, that Balkrishna was clearing motorcycle tyres in the garb of moped tyres.

At the Tribunal, the company's advocate Mr Prakash Shah contended that the end use of the tyres could not be a ground for denying concessional rate of duty.

On the Kinetic info that the Department relied upon, Mr Shah stated that those vehicles were clearly described as mopeds despite having kick-start facility.

Mr M. Moheb Ali, Tribunal Member, had this to say about the moped battle: "It is true that historically mopeds did have pedals but now the concept has undergone a change. In the modern terminology a moped is a light two-wheeled motor vehicle with a small engine of not more than 50 cc. Such a vehicle even if it has the facility of kick-start still cannot be called a motorcycle."

Thus, the idea of kick-start as the identifying feature of motorcycle got a kick.

Also, "no liability can be fastened," said Mr Ali when `misuse' was not with the knowledge of Balkrishna. If moped tyres were sued for vehicle other than mopeds by anyone, the company cannot be faulted, he commented. To explain, he also gave an example: "If there are two rates of duties, one for ladies shirts and another for men's shirts, the former lower than the latter, manufacturer cannot be blamed if men were to use women's shirts when manufacturer had clearly indicated that the shirts were meant for women."

It appears that the Department's representative did not readily have a counter in the form of a quote from the Old Testament:

"The woman shall not wear that which pertaineth unto a man, neither shall a man put on a woman's garment: for all that do so are abomination unto the Lord thy God (Deuteronomy 22:5)."

Glaringly not a computer part!

CAN you call anti-glare glass on monitors part of computers? How ridiculous! But that was the dispute in the Paro Syntex case before the CESTAT recently. After hearing both sides, Mr S. S. Sekhon, Tribunal Member, said:

"The entity is a screen made of glass with nice edge of plastic and used as a shield over the video display monitor of a computer to cut off glare.

The use is only facilitating an application not crucial or essential to the working of a computer." Accordingly, he ruled that it couldn't be a part of computer. "It is merely an accessory that can be used on any TV screen." A glaring example of stretching the meaning of computer too far.

Bitter synthetic medicine

A SIMILAR problem of ambitious classification came up in the Panama Chemical Works case where the company wanted to call its products Panjon Cough Drops, Panjon Balm, and Panjon Rub `ayurvedic medicaments'. Excise Department was of the view that Panama was using synthetic ingredients in its products.

But, Panama cited a 1992 decision of the Madhya Pradesh High Court that `Swad' with 3 per cent active ingredients as per ayurvedic text and 97 per cent sugar/ liquid glucose for taste and as a preservative was an ayurvedic preparation.

Ms Charul Barnwal, arguing for the Department, pointed out that methyl salicylate and thymol synthetic were used in the products. She cited a letter of the Controller, Food and Drugs Administration that synthetic material cannot be used in the manufacture of ayurvedic medicine.

Panama's advocate Mr G. S. Agrawal contended that methyl salicylate is "faithful duplicate of Gandhpura ka tel" so it did not differ in property or composition. Also, that all the ingredients in the Panjon line were those mentioned in authoritative ayurvedic texts.

To resolve the issue, Mr V. K. Agrawal, Tribunal Member, took the help of an apex court decision in the Naturally Health Products case where it was held patent ayurvedic medicament could be one where all the ingredients find mention in authoritative textbooks on Ayurveda, though the formula of preparation of medicament was not in accordance with that given in the books.

Since Panama was using menthol and pudina oil purchased from Richardson Hindustan Ltd in synthetic form, the ultimate products cannot be called ayurvedic, he said. "A synthetic material certainly cannot be equated with the ingredients mentioned in the authoritative textbooks on Ayurveda.

Not sympathetic to synthetic.

Tailpiece

"I went and shouted at the accountant!"

"What?"

"That I have been forced to suffer TDS!"

Detaxification@TheHindu.co.in

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