# COLLECTOR OF CENTRAL EXCISE v. MIS FUSEBASE ELTOTO LTD

- **Citation:** [1993] Supp. 1 S.C.R. 315
- **Court:** Supreme Court of India
- **Decided:** 1993-07-20
- **Case number:** Civil Appeal Nos. 3005G 3007 of 1991
- **Bench:** Kuldip Singh, P.B. Sawant
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/collector-of-central-excise-v-mis-fusebase-eltoto-ltd-11956
- **Pages:** 6

## Headnote

Central Excise and Salt Act, 1944: Section 4-Notifications No. 68/86
and 160/80-'Projection television sets~eld, are covered under the description of "Video projectors" in tenns of notification No. 160/86 and liable to
central excise duty.
A
B
c
The respondent company manufactured projection television sets
with sceens of 79' and 119'. A projection television set consisted of a
'projection unit' and a screen. The projection unit placed at a distance
from the screen was capable of receiving television broadcasts and was
designed to produce images upto 65 times the size of a conventional D
television and to accommodate various inputs such as video cassette
recorder, personal computer/IBM, Doordarshan signals, video camera,
video disc-player etc.These sets cost between Rs.1,20,000 to Rs.1,50,000
each and were sold to video parlours, cinema halls universities, etc. for
catering to a large audience.
E
The respondent claimed that its product was covered under the
category of 'Broadcast television receiver sets' and was entitled to exemp·
ti on from central excise duty in terms of notification N o.68/86. The Assistant Collector, Central Excise and the Collector, Central Excise (Appeals)
rejected the claim on the ground that the product fell under the category F
of 'video projectors" and was subject to central excise duty in terms of
notification No.160/86. On further appeal, the Customs, Excise and
Gold(Control) Appellate Tribnnal decided in favour of the respondent
holding that the "projection television sets" were same as "Broadcast
television sets". The revenue filed the appeal by special leave.
G
On the question: whether 'Projection Television Sets" manufactnred
by the respondent are the same as the "Broadcast Television receiver sets'
for the purpose of earning exemption under the central excise laws.
Allowing the appeal, this Court
315
H
A
316
SUPREME COURT REPORTS [1993) SUPP. 1 S.C.R. ,.
'
HELD: 1.1. When the relevant notifications do not contain any
definition or the products, the test to be followed is as to how the product
called "Broadcast television receiver set" is'identified by the class or section
of people dealing with or using the product. The identity of an article is
associated with its primary function and utility. There is a mental associa·
B lion in the mind of the consumer in respect of certain products keeping in
view the utility or the product and also the reputation the name or the
product has acquired in the market and among the consumers. (319-D·F]
c
1.2. The projection television sets are capable of receiving television
broadcasts as in being done by a 'Broadcast television receiver set" but the
two are entirely different products and the consumers in this country, as
at present, do not identify these two as one and the same product. An
ordinary television set has a fixed image in the mind of the consumer in
this country. One never visualises a television set having a projection-unit
and a head-screen mounted at a long distance. A television set • in the
D imagination of the consumer • is a compact set with inbuilt screen which
adores the drawing room and bed room; whereas the "Projection television
set' manufactured by the respondent projects on a screen the video signals
transmitted from the television station and received by it. 'Video' is the
transmission and reception of a television image; it is a television image
E or the electric signals corresponding to it and pertains to the picture
protion of the televised programme. 'Projector' is a device for projecting
a light beam, and apparatus for throwing illuminated image or motion
pictures on the screen. (319-H, 320·A·B, D·E]
1.3. The Assistant Collector, Central Excise was right in holding that
F the product of the respondent, i.e. "projection television sets'', fully answers
the description of "video projectors" in terms of Notification No. 160/86.
(320-C]

## Text

COLLECTOR OF CENTRAL EXCISE
v.
MIS FUSEBASE ELTOTO LTD.
JULY 20, 1993
(KULDIP SINGH AND P.B. SAWANT, JJ.]
Central Excise and Salt Act, 1944: Section 4-Notifications No. 68/86
and 160/80-'Projection television sets~eld, are covered under the description of "Video projectors" in tenns of notification No. 160/86 and liable to
central excise duty.
A
B
c
The respondent company manufactured projection television sets
with sceens of 79' and 119'. A projection television set consisted of a
'projection unit' and a screen. The projection unit placed at a distance
from the screen was capable of receiving television broadcasts and was
designed to produce images upto 65 times the size of a conventional D
television and to accommodate various inputs such as video cassette
recorder, personal computer/IBM, Doordarshan signals, video camera,
video disc-player etc.These sets cost between Rs.1,20,000 to Rs.1,50,000
each and were sold to video parlours, cinema halls universities, etc. for
catering to a large audience.
E
The respondent claimed that its product was covered under the
category of 'Broadcast television receiver sets' and was entitled to exemp·
ti on from central excise duty in terms of notification N o.68/86. The Assistant Collector, Central Excise and the Collector, Central Excise (Appeals)
rejected the claim on the ground that the product fell under the category F
of 'video projectors" and was subject to central excise duty in terms of
notification No.160/86. On further appeal, the Customs, Excise and
Gold(Control) Appellate Tribnnal decided in favour of the respondent
holding that the "projection television sets" were same as "Broadcast
television sets". The revenue filed the appeal by special leave.
G
On the question: whether 'Projection Television Sets" manufactnred
by the respondent are the same as the "Broadcast Television receiver sets'
for the purpose of earning exemption under the central excise laws.
Allowing the appeal, this Court
315
H
A
316
SUPREME COURT REPORTS [1993) SUPP. 1 S.C.R. ,.
'
HELD: 1.1. When the relevant notifications do not contain any
definition or the products, the test to be followed is as to how the product
called "Broadcast television receiver set" is'identified by the class or section
of people dealing with or using the product. The identity of an article is
associated with its primary function and utility. There is a mental associa·
B lion in the mind of the consumer in respect of certain products keeping in
view the utility or the product and also the reputation the name or the
product has acquired in the market and among the consumers. (319-D·F]
c
1.2. The projection television sets are capable of receiving television
broadcasts as in being done by a 'Broadcast television receiver set" but the
two are entirely different products and the consumers in this country, as
at present, do not identify these two as one and the same product. An
ordinary television set has a fixed image in the mind of the consumer in
this country. One never visualises a television set having a projection-unit
and a head-screen mounted at a long distance. A television set • in the
D imagination of the consumer • is a compact set with inbuilt screen which
adores the drawing room and bed room; whereas the "Projection television
set' manufactured by the respondent projects on a screen the video signals
transmitted from the television station and received by it. 'Video' is the
transmission and reception of a television image; it is a television image
E or the electric signals corresponding to it and pertains to the picture
protion of the televised programme. 'Projector' is a device for projecting
a light beam, and apparatus for throwing illuminated image or motion
pictures on the screen. (319-H, 320·A·B, D·E]
1.3. The Assistant Collector, Central Excise was right in holding that
F the product of the respondent, i.e. "projection television sets'', fully answers
the description of "video projectors" in terms of Notification No. 160/86.
(320-C]
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 3005G 3007 of 1991.
From the Order dated 5.3.1990 of the Customs, Excise and Gold
(Control) Appellate Tribunal, New Delhi in Appeal No. E/2614, 2615 &
2616/89-B, Order No. 34 to 36/90-Bl.
H
Kailash Vasudev, D.S. Mehra and P. Parmeswaran for the Appellant.
..
C.C.E. v. FUSE BASE ELTOTO [KULDIP SINGH, J.]
317
V. Lakshmi Kumaran, A.S. Madan Rajesh Mehta and V. A
Balachandran for the Respondent.
The Judgment of the Court was delivered by
KULDIP SINGH, J.
The question for consideration is whether
"Projection Television sets" manufactured by the respondent are the same
as the "Broadcast Television receiver sets" for the purpose of earning,
exemption llnder the central excise laws. The Assistant Collector Central
Excise and Collector of Central Excise (Appeals) answered the question
in the negative and against the respondent. On further appeal by tile
respondent, the Customs, Excise· & Gold (Control) Appellate Tribunal
(the Tribunal) reversed the findings of the authorities below by its order
dated March 5, 1990 and came to the conclusion that the "Projection
Television Sets" are the same as
11Broadcast Television receiver sets
11 and
as such the respondent was entitled to the exemption claimed. This appeal
B
c
by the Central Excise Department through the Collector of Central Excise D
Meerut is against the order of the Tribul\al.
The projection Television sets manufactured by the respondentcompany are sold under the brand names Hotline Projectavision 203,
Hotline Projectavision 303, Hotline Projectavision 503, Hotline ProjecE
·tavision 222. A single set consists of a "projection-unit" and a screen.
Different models have screens of different sizes. The screen size for the
model Hotline Projectavision 203 is 200 CM (79'), for Hotline Projetavision
303, the screen size is 300 Cm (119') etc. The projection-unit, which is
placed at a distance from the screen, is designed to produce images upto
65 times the size of a conventional television. These sets are sold to video
parlours, cinema halls, universities and other institutions for catering tci a
large audience. According to the respondent the projectavision is designed
F
to accommodate various inputs such as video cassette recorders, personal
computer/IBM Doordarshan signals, video Camera, Video disc-player and
others.
G
The excisable goods specified in Notification No.68/86 dated
February 10, 1986 are exempt from payment of Central Excise duty in
terms of the said notification. Serial No.19 in the said notification is as
under:.
H
318
SUPREME COURT REPORTS [1993] SUPP.1 S.C.R.
A
"19.
85.28
Broadcast televistion receiver sets Rupees 900 per set
(other than monochrome sets) of
screen size
exceeding 36
centimeters
11
Notification No.160/86 dated March 1, 1986 contains .the following
B entry at Serial No.10:
"10.
85.28
(i) television sets in combination Twenty-five percent
with,
video
recording
or ad valorem
reproducing apparatus.
(ii) Video monitors and video Twenty five percent
C
projectors.
ad yalorem"'.
The claim of respondent for grant of exemption under Notification
No.68/86 was rejected by the Assistant Collector and the Appellate Col
lector on the ground that the respondent was manufacturing "Video projectors" and as such they were liable to pay central excise duty in terms of the
D Notification No.160/86. In substance the Department's case was that the
goods manufactured by the respondent did not come within the category
known as
11broadcast television receiver sets".
According to the Assistant Collector inbuil-technology of the projector television receiver set is different than that of a broadcast television
E receiver set. It was highlighted that the projection set has three cathode
rays tubes whereas the ordinary set consists of only one such tube. The
cathode - rays tubes used in both types of sets are entirely different in their
shape, size and function. The Assistant Collector primarily decided against
the respondent company on the ground that the 'projection television set'
F is not known as 'broadcast television receiver set' in common parlance of
the trade. He accepted the contention of the respondent that the projection
television is a television receiver in the sense that it receives the video
signals and the images of distant events and objects but he rejected the
contentions of the respondents on the following reasoning: -
G
H
"But its function is not confined to receiving the images and making
them visible on the receiver set itself. It extends to their projection
outside the receiver set. A careful reading of the notification
No.68/86 would reveal that only a receiver set (as against a projector set) is entitled for concessional rate of duty within the ambit
of its meaning. There should, therefore, be no doubt that a
I
..
C.C.E. v. FUSE BASE EL TOTO [KULDIP SINGH, J.)
319
television set which functions both as receiver and projector is not A
co\'ered by the notification No.68/86 as Amended.
I find tl\.at the distinguishing feature between a television
receiver set a~d the so called projection television (being manufactured by M/s. Fusebase and which is the subject matter of present
dispute) outlined in the show cause notice relate to facts which B
have not been disputed by the party. It is beyond dispute that both
in terms of function and configuration the so called projection TV
is different from a TV as understood in ~ommon parlance of trade.
It is settled law that for the purpose of levy of Central Excise duty,
the most important \onsideration/factor is how it is known in C
market and society. Both in terms of price as also in terms of its
response to the market/society, the so called projection TV is not
considered and known as a television. In so far as this product
(projection TV) projects the images received by it on a
medium/screen outside - about which there is no doubt and dispute D
- It is appropriate to· call it a Video projector."
The Collector (Ap'peals) upheld the above quoted findings of the
Assistant Collector. The TribUnal did. not touch the question as to how the
product called 'broadcast televis'ion receiver set" is identified by the class
or section of people dealing with or using the product. That is the test to E
be followed when the relevant notifications do not contain any definition
of the products. The identity of an article is associated with its primary
function and utility. The names of certain products have functional association in the mind of the consumers. There is a mental association in the
mind of the consumer in respect of certain products keeping in view the F
utility of the product and also the reputation the name of the product has
acquired in the market and among the consumers. 'Broadcast television
receiver sets' and the 'projection television sets' are two entirely different
products and the consumers in this country, as at present, do not identify
these two as one and the same product. When you go to the market to buy
a 'television set' you mean the conventional 'Broadcast Television Receiver G
set' and the dealer will never understand you to mean the 'Hotline Projector Vision 302 etc.'
We agree with the contention of the learned counsel for the respondent that the Projector Vision-Projection television sets are capable of H
320
SUPREME COURT REPORTS [1993] SUPP. 1 S.C.R
A receiving television broadcasts as is being done by any other broadcast
television receiver set but at the same time the two are not the same. An
ordinary television set has a fixed image in the mind of the consumer in
this country. One never visualises a television set having a projection-unit
and a head-screen mounted· at a long distance. A television set - in the
B imagination of the consumer - is a compact set with inbuilt screen which
adores the drawing room and bed room. A television set in the market
costs about Rs. 15,000 to Rs. 25,000 whereas the respondents product costs
between Rs. 1,20,000 to Rs. 1,50,000. We, therefore, agree with the view
taken by the Assistant Collector and the Collector.
C
We, further, agree with the Assistant Collector that the product of
the respondent fully answers the description of "Video Projectors" in terms
of the Notification No.160/86. It is not disputed, rather it is the case of the
respondent that the "projection television set" manufactured by them
receives the televised image. 'Video' is the transmission and reception of a
televised image. In other words, its is a television image or the electric
D signals corresponding to it. It pertains to the picture portion of the
televised programme. 'Projector' is a device for projecting a light beam, an
apparatus for throwing illuminated images or motion pictures on the
screen. The product of the respondent-company projects on a screen the
video signals transmitted from the television station and received by it. The
E Assistant Collector has, thus, rightly reached the conclusion that the
product of the respondent answers the description of a 'video projector'.
We, therefore, allow the appeals and set aside the impugned order
of the Tribunal dated March 5, 1990. As a consequence we dismiss the
appeal of the respondent before the Tribunal. The respondent shall pay
F the costs of the litigation which we quantify as Rs.11,000.
P.R.
Appeal allowed.
I