MILAK BROTHERSversusUNION OF INDIA AND ORS.

                         MILAK BROTHERS
                                     v.
                   UNION OF INDIA AND ORS.

                          OCTOBER 9, 1990

         [S. RANGANATHAN AND-A.M. AHMADI, JJ.]                                B

     Customs Tariff Act, 1975/Indian Tariff Act 1934 Item 13 of the
Second Schedule to the Indian Tariff Act 1934/item 20 of the Second
Schedule to the Customs Tariff Act, 1975: Blanched, roasted and s_alted
peanuts packed in vacuum containers-Liability to export dwy.

     The appellants purchased groundnuts without shell in raw fonn,
                                                                              c
and after subjecting tbem to various processes and treatment, packed
them in packets and tins which were then exported.

      The goods were charged to duty under item 13 of the Second
Schedule to the Indian Tariff Act 1934 and, later, under item 20 of the       D
Second ··Schedule to the Customs Tariff Act, 1975 as •groundnut
kernel". The appellant however contended that the product exported by
it was "processed peanuts", and since the product exported by the
assessee, though basically groundnuts, had been so processed and
treated that it lost its quality of gennination, it could no longer be
described as 'groundnut kernel'. Another argument of the appellant            E
was that groundnut kernel could be said to be of two varieties-one an
edible variety, and the other a variety used for oil extraction purposes,
and that the tariff entry should be confined only to groundnut kernel of
the oil-yielding variety and not the variety exported by the assessee,
which could be more appropriately described as "processed food"
rather than as "groundnut kernel".                                            F

      The appellant's contentions were rejected by the _Collector of
Customs, on appeal by the Central Board of Excise and Customs lihd, on
further revision, by the Government of India. Subsequently, the con-
tentions were rejected by a Full Bench of the Customs, Excise & Goid
Control Appellate Tribunal.                                                   G

      Before this Court, the appellants while reiterating the submis-
sions made before the authorities below, contended that the entry in the
export tariff should be given a restrictive interpretation and if there was
any ambiguity-or doubt it should be resolved in favour of the assessee. It
was fUrther submitted that, in matters of export and import, the func-        H

                                   141
    142         SUPREME COURT REPORTS                 I 1990] Supp. 2 S.C.R.

    tional test was slowly replacing other tests.
A
           On !he other hand, it was contended on behalf of the Revenue that:
    (i) the expressions 'groundnut kernel' and 'groundnut shell' used in the
    export entry were of widest connotation; (ii) ther was no justification
    whatsoever for restricting the meaning of the word 'kernel' on the basis
B   of the capacity to germinate or lo yield oil; (iii) the functional test may
    be attracted where t~ere was a bifurcation or classification as in the
    tariff entries, but there was no justification to import any such test
    where the expression, as in this instance, was broad and unrestricted;
    and (iv) groundnut kernel remains groundnut kernel even after roast-
    ing and frying and the processing and treatment did not create a diffe.
    rent product.
c
          Dismissing the appeals, this Court,

          HELD: (1) There is no difficulty or ambiguity in the interpretil'
    ti on of the tariff entry. Groundnut is a well known commodity which is
D   available both in shell and as kernel. In this context, 'kernel' clearly
    means the grain, seed or the soft matter inside the shell, whatever the
    use or purpose to which it is put, eating or crushing for oil or sowing.
    The tariff entry covers all groundnut and there is no justification for
    confining it to the germinating or the oil seed variety alone. [151C-D]

E         M/s Healthways Dairy Products Co. v. Union of lndia & Ors.,
    I 1976I 2 sec 887, referred to.
          (2) Assuming that two different commercial commodities fall
    nuder the same entry, there is no reason why the entry should be
    restricted to only one of them. It can and should cover both unless one
F   can say that the commodity marketed by the appellant is not 'gronnd·
    nut kernel'. [151E]

          Diwan Chand Chaman Lat's Case [1977) 39 STC 75, referred to.

          (3) Though the raw groundnut kernel has undergone a drying,
G   roasting and frying process, its identity as groundnut is not lost. Even in
    the market to which it is exported and where it is marketed, it is
    purchased as groundnuts. [151.G]

          (4) The legislature must be presumed to know that, for import
    purposes, for instance, groundnuts are classified nuder different head-
H   ings with differential rates of duty. Those entries appear not elsewhere
              MILAK BROS. v. U.O.l. IRANGANATHAN, J.]                   143

but in the First Schedule of the very enactment which sets out the export
                                                                               A
tariff, If, in spite of such detailed classification elsewhere, the legisla-
ture decided to use a wider expression in the Second Schedule, the
intention of the legislature must be given effect to, [152C-D]

      (5) Once it is realised that both oil seeds and roasted groundnuts
exported by the assessee are capable of being described as •groundnut          B
kernel', which is what the entry talks of, the various circumstances
pointed out-that they have different markets, that their end use is
different, that one of them has been excepted from the export ban, that
their export is done under the auspices of different Export Promotion
Councils-all fall into place and reveal no inconsistency with, and have
no bearing on, the interpretation to be pieced on the entry, '[153B-C]
                                                                               c
      Kalaivani Fabrics v, Collector, [1989] 44 ELT 219, Overruled,

      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 390..
of 1979.
                                                                               D
     From the Order dated 14.2.1978 of the Central Go.vt. .at New
Delhi in Revision Petition No. MB/133/77.

      Anil B. Dewan, S.K. Dholakia, P.C. Kapur and P:Narasimhan
for the Appellants.
                                                                               E
     Kapil Sibbal, Additional So)icitor .General (NP), Ms. Nisha
Bagchi, Ms. Sushma Suri and C.V.S. Rao for the Respondents.

      The Judgment of the Court was delivered by

      RAN GANATHAN, J, All these appeals involve a Coinmoll ques-              F
tion as to whether the goods exported by the appellants ·are liable to
export duty. There are 67 appeals which relate to various batches of
exports made by the appellants duririg the period from 4.3;76 to
14,2.82. They will be disposed of by this sommon order.

      The goods exported by the appellants are blanched, roasted and           G
salted peanuts packed in vacuum containers. The appellants purchase
groundnuts without shell in raw form various parts of Saurashtra in the
State of Gl!jarat. Thereafter, they are sorted out into different sizes-
sma(L, medium and big. The medium and small sizes are separated.
Dust and hlisk are cleaned out and other foreign material removed.
The commodity then goes to a dry roaster where it is roasted at a              H
    144         SUPREME COURT REPORTS               [ 1990] Supp. 2 S.C.R.

A temperature of 150°C. This results in reduction of the moisture and
  destruction of enzymes to a considerable extent. It is also stated that
  by this process any fungus or aflotoxin is removed. After dry roasting,
  the product is cooled down with the aid of a blower so that the skin of
  the groundnuts become loose and the groundnut contracts. Thereafter,
  it goes through auto.matic blanching machines. This separates the skin
B of the groundnut and on removal of the skin it becomes white. There-
  after, the seeds are put on running tables and picked, according to
  uniform sizes, with the aid of an electric eye sorter. The commodity
  thereafter goes to a frying section for being subjected to deep oil bath
  frying in an authomatic fryer. They are then subjected to anti-oxident
  chemicals and thereafter sent through the blower for being cooled
C down. The extra oil is sucked out. They are then subjected to a glazing
  process and are given permeated chemicals and salt treatment and are
  packed in packets and tins.                               /

          The goods thus exported by the appellants are .charged to duty
    under item 13 of the Second Schedule to the Indian Tariff Act 1934
D   and, later, under item 20 of ,the Second Schedule to the Customs Tariff ·
    Act. 1975. The entry is the same under both enactments but the rate of
    duty is different. The entry reads:

    Item No.    NameofwticJe                  Rate of duty

E   1320       Groundnut:-
                (i) Groundnut Kernel          Rs.810/1500 per tonne
               (ii) Groundnut in shell        Rs.600/1125 per tonne

        The appellant contended that the product exported by it was
  "processed peanuts" and that. it did not fall under the tariff entries
F above extracted. The first line of argument of the assessee was that the
  item 'groundnut kernel' refers to groundnut seeds, the basic char-
  acteristic of which is the quality of germination. It was submitted that,
  since the product exported by the assessee, though basically ground-
  nuts, had been so processed and ll.!ated that it lost its quality of
                                                                                ~

  germination, if could no longer be described as 'groundnut kernel'.           '>
G The second line of argument put forward on behJ!lf of the appellant
  was that the entry in the export tariff referred only to groundnut
  kernel used for oil extraction. It was pointed out that groundnut in
  shell as well as groundnut kernel can be said to be of two varieties-
  i)oe an .edible variety, and the other a variety used for oil exttaction
  purposes. While it is true that it is not a mutually exclusive classific&-
H tion in that·perhaps all groundnut is capable of being eaten or of being
              MILAK BROS. v. U.0.1. IRANGANATHAN, J.l                  145

processed to yield oil, the submission was that these two varieties of
                                                                         A
groundnut kernels or groundnut in shell were two different trade
commodities. They had different characteri.stics; they were meant for
different markets; their end-use was different; and their prices as well
as mode of pricing were totally different. Referring to entries in this
regard in the BTN (British Trade Nomenclature), the Indian Import
Tariff as well as the Indian Import Export Policy, it was contended on B
behalf of the appellant that the entry should be confined only to
groudnut kernel of the oil yielding variety and not the variety exported
by the appellant, which could be more appropriately described as ·
·•processed food .. rather than.as groundnut kernel.

      The appellant's contention, initially put forward before th,e
Assistant Collector of Customs in an application for refund, was             c
rejected by the Collector of Customs, on appeal by the Central Board
of Excise and Customs and, on further revision, by the Government of
India under the then existing procedure. So far as the subsequent
periods of exports were concerned, the contentions of the appellant
were considered and rejected by a Full Bench of the Customs, Excise          D
& Gold Control Appellate Tribunal. The appellant preferred a Special
Leave Petition from the order of the Central Government in revision
dated 14.2. 1978, which was admitted and numbered as Civil Appeal
No. 390 of 1979. Against the other orders of .the Tribunal, the appel-
lant has preferred appeals to this Court under section 130-E of the
Customs Act, 1962.

     On behalf of the appellants, a number of circumstances have
been relied upon to justify the distinction sought to be made between
groundnut kernel simpliciter and blanched and roasted groundnuts
exported by the assessee. It will be convenient to summarise the points
made on behalf of the appellant here:                                        F

     (1) In the Indian Trade Classification (I.T.C.), which has been
     published by the Government of India for purposes of foreign
     trade, there is a bifurcation in the classfication between the oil
     seeds and roasted nuts. There are various revisions o.f this clas-
     sification. Upto !st April, 1972, the l.T.C. classified oil seeds,      G
     oilnuts and oil kernels in Division 22. The various items occur-
     ring under this Division were as follows:

Code.No.        Description                         Unit of Quantify

Group 221--0il seeds, oilnuts and oil kernels                                H
    146          SUPREME COURT REPORTS


                      Groundnuts (Peanuts), green,
                                                    I 1990] Supp. 2 S.C.R.   •
A 22 I. I
                      whether or not shelled (excluding
                      flour and meal)
    221. 1001         Groundnut kernels. H.P.S.
  22 l. 1002          Groundnut kernels. N.E.S.
  22 l. 1003          Groundnut in shell, H.P.S.        TONNE
B 22 I. 1004          Groundnut in shell, N.E.S.,

    As against the above. in group No. 053. roasted nuts are specified· as
    below:

            053.9009 Others (roasted nuts including groundnuts)
c         In a revised alphabetic index to the commodities, the relevant
    code numbers for various commodities pertaining to groundnuts are as
    follows:

    Commodity                                   Code No.
D

    Groundnut in Shell HPS                       221.1003

    Groundnut in Shell NES                       222. 1004
E Groundnut kernels HPS                          222.1001

    Groundnut kernels NES                        222.1002

    Groundnut oil, crude                         423.4001
F   Groundnut oil purified                       423.4002

    Groundnut oil, deodorized                    423.4003

    Groundnut oil, hydrogenated                  431.2001
G   Groundnut oil cake and meal                 1081.3201

    Groundnut roasted                            058.9107

         In the more recent classification heading No. 12.02 refers to
H   groundnuts, not roasted or otherwise cooked, whether or not shelled
               MILAK BROS. v. U.0.I. [RANGANATHAN. J.[              147


or broken. The unit of quantity in which these goods are sold is tonne.
                                                                          A
This chapter deals with various types of oil seeds like soya beans.
copra, linseed, rape or colza seeds, sunflower seeds, palm nuts and
kernels and other oil seeds and oleaginous fruits. On the other hand
edible nuts come under heading 20.08, which reads thus:

           "Fruit, nuts and other edible parts of plants, otherwise       B
           prepared or preserved, whether or not containing added
           sugar or other sweetening matter or spirit, not elsewhere
           specified or included

           -   Nuts, ground-nuts and other seeds, whether or not
               mixed together:
                                                                          c
           - Ground-nuts                                           Kg.
           - Other, including mixtures
           - Cashew nut, roasted                                   Kg.
           ~ Nuts, prepared or preserved                           Kg.
           - Other roasted nuts and seeds n.e.s.                   Kg." D

      (2) A similar classification has also been made under the BTN.
Chapter 12 deals with oil seeds and oleaginous fruit, miscelianeous
grains, seeds and fruit, industrial and medical plants, straw and fod-
der. Note l under this Chapter reads thus:
                                                                          E
           1. Heading No. 12.01 is to be taken to apply, interalia, to
           ground-nuts, soya beans, mustard seeds, oil poppy seeds,
           poppy seeds and copra. It is to be taken not to apply to
          ·coconuts or other products of heading No. 08.01 or to
           olives (Chapter 7 or Chapter 20).
                                                                          F
     Heading 12.01 reads:

           "Oil seeds and oleaginous fruit, whole or broken-This
           heading covers seeds and fruit of a kind used for the extrac-
          tion (by pressure or by solvents) of edible or industrial ojls
          and fats, whether they are.imported for that purpose, for. G
          sowing or for other purposes. It does not, however, include
          olives (Chapter 7), coconuts (heading 08.01) or certain
          seeds and fruits from which oil may be extracted but which
          are primarily used for other purposes, e.g. walnuts and
          almonds (heading 08.05), apricot, peach and plum kernels
          _(heading 12.08) and cocoa beans (he.acting 18.01)".           H
    148 .       StiPREME COURT REPORTS               [1990] Supp. 2 S.C.R.

    It is also stated that the heading covers, inter a/ia, ground-nuts (except
A
    roasted ground-nuts-heading 20.06). As against this heading 20.06,
    which deals with fruit otherwise prepared or preserved, whether or not
    containing added sugar or spirit, carries the following sub-heading:

                (3) Almonds, ground-nuts, areca (or betel) nuts and other
B               nuts, dry-roasted, oil-roasted or fat-roasted, whether or
                not containing or coated with vegetable oil, salt, flavours.
                spices or other additives.

           (3) Even under the Customs Tariff, the first Schedule, which
    deals with import, contains a similar classification. Chapter 12 and
    note I to the Chapter are the same as in BTN. Item 12.0 I reads-oil
c   seeds, and oleaginous fruit, whole or broken-( 1) not elsewhere
    spec.ified (2) Copra. Chapter 20 deals with preparations of vegetables,
    fruit or.other parts of plants. It contains a note that the Chapter covers
    edible plants, parts of plants and roots of plants conserved in syrup
    (for example, ginger) and roasted groundnuts.
D
         ' (4) It is pointed out that the goods of the appellant are exported
    through the medium of Processed Foods Export Promotion Council,
    Delhi, whereas groundnuts intended forpil extraction purposes are
    exported through the Indian Oil and OiL'Produce Exporters' Associa-
    tion, Bombay. This indicates that the customers for two types of goods
E   are totally different.

        , (5) Ou 14th July, 1976, the Government oflndia decided to ban
    with immediate effect export of HPS (Hand Picked Seeds) groundnuts
    (both in shell and kernel), which is canalised through Indian Oil and
    Oil Produce Exporters' Association. However, by an export trade
F   notice dated 8.9.76, the Government of India clarified that the item
    "blan~hed and roasted groundnut kernels", does not fall within the
    purview of Exports Control Order, 1968 and its export is allowed
    without any licensing formalities.

         I (6) It has been pointed out that the Collector of Customs useci
G   to levy and recover an agricultural cess on the goods in question until
    the Governmment of India, by an order of 1976, held that the roasted
    and. salted peanuts/groundnuts exported by the assessee were not
    liable to cess under the Agricultural Produce Cess Act, 1940.

         {7) It is pointed out that the packed roasted seeds exported by
H   the appellants are more value added than raw groundnut kernel used
              MILAK BROS. v. U.0.I. lRANGANATHAN, J.J                149

for other purposes. The assessee's product is packed in vacuum con-
tainers and sold in terms of kilograms, whereas other groundnuts are        A
exported in bags or drums and sold in tonnes. It would not be correct
to bring both of them under same classification for export purposes.

      Relyi°ng on the above points of difference, Shri Divan and
Dhcilakia, appearing on behalf of the app' llant vehemently contend B
that the entry in the expc"t tariff should be given a restrictive interpre-
tation. Reliance is placed in this context on a judgment of the Madras
High Court in Kalaivani Fabrics v. Collector, [1989] 44 E.L.T. 219 a
direct decision on the present issue. Reference is.· made also to the/
cases cited therein and, in particular, to the ruling of this Court in M/s.
Healthways Dairy Products Co. v. Union of India & Ors., [1976] 2 .C
S.C.C: 887. Shri Divan submits that if there is.any ambiguity or doubt
it should be resolved ii:i favour of the assessee. He contends that, while
the taxing authorities, on whom the onus lies, have merely rested on
the dictionary meaning of the word 'groundnut kernel', the assessee
has placed a lot of material show that there are two different commer-
cial varieties of groundnut kernel. He subm.its that, in matters of D
export and import, the functional test is slowly replacing other tests,
;m approach clearly indicated by the classifications under the BTN,
ITC and the import tariffs. Shri Dholakia, appearing on behalf of the
appellant in one of the appeals, very strongly urges that the commo-
dity known as groundnut kernel consists of two entirely different
varieties or classes ·particularly in matters of trade. There is a sea of E
difference between the groundnut kernel which is exported as an oil
producing variety and the roasted peanuts which are exported more or
less as a 'processed food' by the appellant. The produce exported by
the appellants has no oil content; it is incapable of being used fof ·
germinating purposes; its market, its unit of quantity of..aje-, its price
and even its exporters are totally differepL_-"iewe.f trom the commer- F
cial point of view' it is impossible to mix up these two varieties under
one common.heading and this could ndt have been the intention of the.
export tariff. He, therefore, submits that the export tariff item should
be restricted only to one of these varieties, namely, the oil seed variety
or the germinating variety and should not be extended to the roasted
items sold by the assess.ee.                                                G

      Shri Dholakia also raised a point that the appe·ll~nt's factory was
located in a free trade zone. and that, having regard to the various
notifications of the Government oflndia, the Government was estop-
ped from levying any export duty on its products. This last contention
of Shri Dholakia is, however, a totally new one. The necessary facts to     H
    150         SUPREME (OURT REPORTS                  [ 1990] Supp. 2 S.C.R.

    found any such promissory estoppel have not been put forward or
A
    considered by any of the assessing or appellate authorities. We, there-
    fore, decline to permit Shri Dholakia to raise this question at this
    belated stage. His application for urging additional grounds in this
    regard is rejected.

           On the other hand Ms. Nisha Bagcht, who argued the case on
    behalf of the Union of India very ably. submitted that the expressions
    ·groundnut kernel' and 'groundnut shell' used in the export entry were
    of the widest connotation. She referred to the dictionary meanings of
    the word 'kernel' and submitted that there is no justification what-
    soever for restricting its meaning on the basis of the capacity to germi-
    nate or to yield oil. She submitted that the reliance placed on behalf of
c   the appellants on the BTN, ITC and Import Tariff classifications was
    totally misplaced. In fact, she contended, the very fact that the export
    tariff avoids all these classifications and uses a wide expression, which
    is capable of taking in both the edible as \\ell as the oil seed varieties of
    the groundnuts, supports her contention that, so far as export tariff is
D   concerned, the legislature intended no iimitations whatsoever. In
    support of her contention as to the wide meaning of the expression
    ·groundnut kernel', she relied on certain observations of this Court in
    State v. Shanmagha Vils Cashewnuc Factory, [ 1953] 4 S.T.C. 205 and of
    the Madras High Court in Binod Cashew Corporation v. Deputy
    Commercial Tax Officer, [ 1986] 61 S.T.C. I. She submitted that the
E   interpretation sought to be placed on the entries in the export tariff by
    the appellant will carve away a substantial category of the goods
    described in the wide tariff entry from its scope. So far as agricultural
    cess is concerned, she pointed out, rightly, that it was leviable only in
    respect of "seeds", an expression that imports a concept of a capacity
    to germinate, particularly, in an agricultural context. Obviously, the
F   groundnut kernel, roasted and salted, could not be described as 'seeds'
    and, therefore, the Government of India had rightly exempted them
    from agricultural cess. The very fact that the export tariff uses the
    expression 'groundnut kernel' instead of 'seed' also points to the dis-
    tinction between the two. According to counsel, the functional test
    may be attracted where there is a bifurcation or classification as in the
G   tariff entries referred to on behalf of the appellant but there is no
    justification to import any such test where the expression, as in this
    instance, is broad and unrestricted. Referring to the exemption from
    export ban, learned counsel submitted that the very fact that it was
    considered necessary to exempt the blanched and roasted peanuts
    from the export ban indicates ihat otherwise they would have been
H   included in the export ban. Learned counsel took us through the
              MILAK BROS. >. U.0.1. IRANGANATHAN, J.I                   151

orders of the appellate authorities and the tribunal and submitted that
they have taken a correct view in the matter which does not call for any      A
interference. She submitted that groundnut kernel remains groundnut
kernel even after roasting and frying. The process, though described
elaborately on behalf elf the appellant, does not create a different
product. This, she pointed out, was the finding of the appellate
authorities. There is no justification, therefore. counsel contended. to      B
read any limitation into the export entry. She urged that we should
accept the conclusion arrived at by the departmental authorities and
the tribunal and dismiss these appeals.

       Having considered the submissions of both parties. we are of
opinion that the contention of the Revenue should prevail. To our
mind, there is no difficuN:y or ambiguity in the interpretation of the        c
tariff entry, Groundnut is a well known commodity which is available
both in shell and as kernel. In this context, 'kernel' clearly means the
grain, seed or the soft matter inside. the shell, whatever the use or
purpose to which it is put, eating or crushing for oil or sowing. The
tariff entry covers all groundnut and there is no justification for confin-   D
ing it to the germinating or the oil seed variety alone. On behalf of the
appellant, it is emphasised that the goods exported by the assessee and
groundnut oil seeds are totally different commercial commodities. It is
submitted that Diwan Chand Chaman La/'s case [1977] 39 S.T.C. 75
says so and that the various classification lists produced prove this.
Even the acceptance of this argument does not carry the appellant's           E
case to the desired result. Assuming that two different commercial
commodities fall under the same entry, there is no reason why the
entry should be restricted to only one of them. It can and should cover
both unless one can say that the commodity marketed by the appellant
is not 'groundnut kernel'.
                                                                              F
       We are not convinced that the goods exported by the assessee
have ceased to be groundnuts in the ordinary acceptation of the term
or that they have become a different commodity, say, a processed food
(indeed, there is no such classification in the tariff entry). The decision
in Diwan Chand Chaman Lal, I 1977] 39 STC 75 turned on the descrip-
tion of groundnuts in Schedule C of the Punjab Sales Tax Act as a             G
species of oil seeds and it was held that parched groundnuts consti-
tuted a different commodity. But the fact is that, though the raw
groundnut kernel has undergone a drying. roasting and frying process,
its identity as groundnut is not lost. Even in the market to which it is
exported and where it is marketed, it is purchased only as groundnuts
(or peanuts, as they are called in the U.S.A.). May be there are two          H
    152          SUPREME COURT REPORTS                [1990] Supp. 2 S.C.R.

   different commodities but both are known only as ·groundnuts'. The
A
    argument that the scope of the entry should be restricted because of
   the two-fold classification existing elsewhere between groundnuts as
    "oil-seeds" and groundnuts as "fruits, nuts and edible substances"
   does not appeal to us. In the first place, it does not meet the argument
   that basically both items are only varieties of groundnuts and hence not
B taken out of the relevant entry. Secondly. there is force in the argu-
    ment of State counsel that the legislature has, deliberately, not
    adopted, for the purposes of the Second Schedule, the minute multi,
   classification of the First Schedule and allied classifications. Unlike the
    Import Tariff, the BTN and the ITC, there is no sub-classification
    attempted in the export entry. The legislature must be presumed to
    ki:iow that, for import purposes, for instance, groundnuts are classified
c under different headings with differntial rates of duty. Those entries
    appear not elsewhere but in the First Schedule of the very enactment
   which sets out the export tariff. The Frist Schedule to the Indian Tariff
    Act refers to seeds, oil-seeds and oil in section II and talk only of
   canned fruits and vegetables in sectioon IV (dealing with products of
D food-preparing industries). The entries in the Customs Tariff relating
   to imports have already been touci.ed upon. If, in spite of such
    detailed classification elsewhere, the legislature decided to use a wider
    expression in the Second Schedule, the intention of the legislature
  . must be given effect to. Shri Dholakia submitted that while the need to
    restrict imports necessitated a detailed enumeration and precise clas-
E   sification, the export duty is levied only on a short list of items. This
    ma'y be so but this point of distinction is not enough to explain why,
    when an entry finds a place in the export tariff, it should not receive its
    normal interpretation but should recieve one circumscribed by the
    entries in the import tariff or other classifications.

F         A point was also made by Sri Dholakia that, since the export
    duty is on the basis of tonnes and it is only the groundnut oil seed that
    is exported in units of tonnes, the entry should be confined to this
    commodity alone. This, we are afraid, is a very precarious basis for the
    interpretation of the body of the entry. Jn this context, we should also
    point out that no difficulty, anomaly or absurdity arising out of the
G   computation of export duty in terms of tonnes on these goods was
    brought to the notice of the authorities at any stage. It may perhaps
    have helped if material had been placed before the authorities as to the
    n~ture and magnitude of the exports of the two classes of groundnuts,
    their relative prices and the duty impact thereon. In the absence of any
    such material, we find it difficult to hold that the commodity in ques-
H   lion should be excluded because of the mode of computation of duty
                   MILAK BROS. v. U.0.1. IRANGANATHAN, J.I              153

              ""
    prescribed by the tariff entry.                                           A

          Once it is realised both oil seeds and roasted groundnuts
    exported by the assessee are capable of being described as 'groundnut
    kernel', which is what the entry talks of, the various circumstances
    pointed out-that they have different markets, that their end use is
                                                                              B
    different, that one of them has been excepted from the export ban.
    that their export is done under the auspices of different Export Promo-
    tion Councils-all fall into place and reveal no inconsistency with, and
    have no bearing on, the interpretation to be placed on the entry.

         For these reasons, we are of opinion that the stand of the
    Revenue has to be upheld and the decision of the Madras High Court        c
    in Ka/aivani Fabrics (supra) overruled. These appeals, therefore. fail
    and are dismissed. We, however, make no order as to costs.

    R.S.S.                                              Appeals dismissed .




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I