# DUNLOP INDIA LTD v. UNION OF INDIA AND ORS - **Citation:** [1976] 2 S.C.R. 98 - **Court:** Supreme Court of India - **Decided:** 1975-10-06 - **Bench:** A. Alagiriswami, P. K. Goswami, N. L. Untwalia - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/dunlop-india-ltd-v-union-of-india-and-ors-6601 - **Pages:** 17 ## Headnote Indian Tariff Act 19,34-ltems 39, 82-"V. P. Latex"-Classification oflnterference under Art. 136 of the Constitution in classification of excisable items-Rule of Practice-Whether "V.P. Latex" an item .of "raw rubber" falling under l.C.T. 89-Whether showing by the agents, while filling up the various columns of the Bills of Entry as "!.C.l. item 87-V.P. Latex·•, operates as ''Estoppel by conduct" to claim refund. The appellants, ma·nufacturers of automobile tyre» import "V.P. Latex'', an essential ingredient for the manufacture of tyres. The customs authorities (Appraising) at Calcu.tta and Madras classified it as non raw·rubber, an item covered under item 82(3) (now 87) of the Indian Customs Tariff and levied duty in addition to the counterva.iling duty. On appeals, while the Appellate Collector of Customs, ;Madras maintained the appraiser's stand, the Appellate Collector of Customs, Calcutta accepted the· view that V.P. Latex is an item of raw rubber and covered by Item 39 of the Indian Customs Tariff. The Central Government in revision, however, held that "V.P. Latex being an aqueous dispersion of synthetic resin is covered by Item 87 J.C.T." and thus confirmed the Madras view. On appeal, by special leave the appellants contended, (i) that V.P. Latex is a synthetic rubber latex and never to be taken for synthetic rc»in in as much as'.- (a) V.P. Latex, being rubber can be vulcanised while synthetic resin cannot be (b) .V.P. Latex, when coagu.lated, the coagulum answers fully the A.S.T.M. E standards including elongation tests prescribed for rubber. F G (c) In the international field of rubber manufacture, all over the world, V.P. Latex i'> fully recognised as a synthetic rubber latex and not as a synthetic resin and (d) Even the entry 150 of the "Red Book", "Import Trade Control Policy" Vol.. I for the various years shows under "Actual Users for Synthetic rubber" specifically as including "Vinyl Pyridine lated" (VP-Latex)." Accepting .the appeal, the Court HBLD : (1) It is not for the court to determine for itself under Art. 136 of the Constitution under which item a particular article falls. It is best left to the authorities entrusted with the subject. But where the very basis of tlle reason for including the article under a residuary head, in order to charge higher duty is foreign to a proper determination of this kind, the Court wiil be loath to say that it will not interfere. [113 E-F] V. V. Iyer of Bombay v. Jasjit Singh, Collector of Customs and Anr., [1973] 1 S.C.C. 148, Collector of Customs, Madras v. K. Ganga Setty, fl 963] 2 S.C.R. 277 distinguished. Commissioner of Sales Tax, U.P. v. Mis. S. N. Brothers, Kanpur, [1973] 2 S.C.R. 825 not applicable. (ii) There is no estoppel in law against a party in a taxation matter. Giving of a classification by the appellants agents in order to clear the goods for customs, H either under some misapprehension or in accordance with the wishes of the au.thorities is of no significance especially when Jaw allows them the right to ask for refund on a proper appraisement and when they actually applied for. [113H, 114AJ , ' , DUNLOP INDIA v. UNION (Goswami, J.) 99 (iii) Under Section 12 of the Customs Act of 1962, the relevant taxing event is the importing into or exporting from India. Condition of th~ art~cle at the time of importing is a material factor for the purpose of class1ficat1~m as to under what head, duty will be leviable. The reason given by the. authority that V.P. Latex when coagulated as solid rubber cannot be commercially used as an economic proposition is an extraneous consideration for classiikation. The basis of the reason with regard to the end-use of the article is absolutely irrelevant in the context of the entry where there is no reference to the use or adaptation of the article. [l lOE-G, 114-D-E] (iv) It is well established tha1 in interpreting the meaning of words in a taxing st>1tute, the acceptation of a particular word by the Trade and is popular meaning sh ## Text _Characters 0–39,528 of 46,972. This is a partial read: ask again with offset=39528 for what follows._ A n c D 98 DUNLOP INDIA LTD. v. UNION OF INDIA AND ORS October 6, 1975 [A. ALAGIRISWAMI, P. K. GOSWAMI AND N. L. UNTWALIA, JJ.] Indian Tariff Act 19,34-ltems 39, 82-"V. P. Latex"-Classification oflnterference under Art. 136 of the Constitution in classification of excisable items-Rule of Practice-Whether "V.P. Latex" an item .of "raw rubber" falling under l.C.T. 89-Whether showing by the agents, while filling up the various columns of the Bills of Entry as "!.C.l. item 87-V.P. Latex·•, operates as ''Estoppel by conduct" to claim refund. The appellants, ma·nufacturers of automobile tyre» import "V.P. Latex'', an essential ingredient for the manufacture of tyres. The customs authorities (Appraising) at Calcu.tta and Madras classified it as non raw·rubber, an item covered under item 82(3) (now 87) of the Indian Customs Tariff and levied duty in addition to the counterva.iling duty. On appeals, while the Appellate Collector of Customs, ;Madras maintained the appraiser's stand, the Appellate Collector of Customs, Calcutta accepted the· view that V.P. Latex is an item of raw rubber and covered by Item 39 of the Indian Customs Tariff. The Central Government in revision, however, held that "V.P. Latex being an aqueous dispersion of synthetic resin is covered by Item 87 J.C.T." and thus confirmed the Madras view. On appeal, by special leave the appellants contended, (i) that V.P. Latex is a synthetic rubber latex and never to be taken for synthetic rc»in in as much as'.- (a) V.P. Latex, being rubber can be vulcanised while synthetic resin cannot be (b) .V.P. Latex, when coagu.lated, the coagulum answers fully the A.S.T.M. E standards including elongation tests prescribed for rubber. F G (c) In the international field of rubber manufacture, all over the world, V.P. Latex i'> fully recognised as a synthetic rubber latex and not as a synthetic resin and (d) Even the entry 150 of the "Red Book", "Import Trade Control Policy" Vol.. I for the various years shows under "Actual Users for Synthetic rubber" specifically as including "Vinyl Pyridine lated" (VP-Latex)." Accepting .the appeal, the Court HBLD : (1) It is not for the court to determine for itself under Art. 136 of the Constitution under which item a particular article falls. It is best left to the authorities entrusted with the subject. But where the very basis of tlle reason for including the article under a residuary head, in order to charge higher duty is foreign to a proper determination of this kind, the Court wiil be loath to say that it will not interfere. [113 E-F] V. V. Iyer of Bombay v. Jasjit Singh, Collector of Customs and Anr., [1973] 1 S.C.C. 148, Collector of Customs, Madras v. K. Ganga Setty, fl 963] 2 S.C.R. 277 distinguished. Commissioner of Sales Tax, U.P. v. Mis. S. N. Brothers, Kanpur, [1973] 2 S.C.R. 825 not applicable. (ii) There is no estoppel in law against a party in a taxation matter. Giving of a classification by the appellants agents in order to clear the goods for customs, H either under some misapprehension or in accordance with the wishes of the au.thorities is of no significance especially when Jaw allows them the right to ask for refund on a proper appraisement and when they actually applied for. [113H, 114AJ , ' , DUNLOP INDIA v. UNION (Goswami, J.) 99 (iii) Under Section 12 of the Customs Act of 1962, the relevant taxing event is the importing into or exporting from India. Condition of th~ art~cle at the time of importing is a material factor for the purpose of class1ficat1~m as to under what head, duty will be leviable. The reason given by the. authority that V.P. Latex when coagulated as solid rubber cannot be commercially used as an economic proposition is an extraneous consideration for classiikation. The basis of the reason with regard to the end-use of the article is absolutely irrelevant in the context of the entry where there is no reference to the use or adaptation of the article. [l lOE-G, 114-D-E] (iv) It is well established tha1 in interpreting the meaning of words in a taxing st>1tute, the acceptation of a particular word by the Trade and is popular meaning shou.ld commend itself to the authority. It is clear that meanings given to artides fa a fiscal statute must be as people in trade and commerce, conversant with the subject, generally treat and understand them in the usual course. But once an article is classified and put under a distinct entry, the basis of the classification is riot open to question. Technical and scientific tests offer guidan~e only within limits. Once the articles are in circulation and come to be described and known in common parlance, there is no difficulty for statutory classification under a particular entry. [110H; 1!3A-C] King v. Planters Nut and Chocolate Co. Ltd. (1951) Canada Law Reports 122; Ramavatar Budhaiprasad etc. v. Assistant Sales Tax Officer [1962] 1 S.C.R. 279'; Commissioner of Sales Tax, Madhya Pradesh, Indore v. M/s. laswant Singh Chanan Singh A.LR. 1967 S.C. 1454; South Bihar Sugar Mills Ltd. etc. v. Union of l'!.dia and Ors., [1968] 3 S.C.R. 21; Mineral Metals Trading Cor· poration of [11dia Ltd. v. Union of lndia & Ors. [1973] 1 S.C.R. 148; referred to. .. HELD FURTHER • (v) In the instant case, it is clear that the authority would have found no difficulty in coming to the conclusion that V.P. Latex in view of chemical composition and physical property is rubber raw, if the same were commercially used as rubber. The authority, therefore, wa-s principally influenced to come to its decision on the sole basis of the. ultimate use of the imported article in the trade. There is no reason, when as a matter of fact, in the Red Book (Import Trade Control Policy of the Ministry of Commerce), V.P. Latex is specifically included under tbe su.b head "synthetic rubber", the same policy could not have been followed in .the I.C.T. book being complementary to each other. When an article has, by ali standards, a reasonable claim to be classified under an enumerated item in the Tariff Schedule it will be against the very principle of classification to deny it the parentage and consign it to an orphanage of the residuary clause. When a particular product like V.P. Latex known to trade and commerce in this country and abroad is imported; it would have been better, if the article is, "eo nomine" put under a particular classification to avoid controversy over the residuary clause. [llODE, 113D-E, 113-C] (vi) V.P. Latex is raw rubber and comes under an item under ICT 39 of the Indian Tariff Act 1934. [114-DJ OBITER : It is a good fiscal policy not to put people in doubt and quandary about their liability to duty. When evidence is well balanced, the best cause in a fiscal measure is to decide and fix the entry under which the article comes otherwise it will give rise to adoption of varying standards where uniformity should be the rule. [113C & G] [The court, expressed no opinion with regard to the question relating to countervailing duty under 16 AA of the First Schedule to the Central Excise and Salt Act, 1944] • A c D E F G H A B JOO SUPREME COURT REPORTS [1976] 2 S.C.R. C1v1L APPELLATE JURISDICTION : Civil Appeal Nos. 1446 and 2746 of 1972. Appeals by Special Leave from the Judgment and Order dated the 14th January, 1972/17th August, 1972 of the Central Govt. in Rvs. under Sec. 131 (3) of the Customs Act, 1962 being No. 25/53/59 ous (Tu), 1972 and of the Collector of Customs, Custmm House, Madras in Appeal No. C/3/1848 of 1970 respectively. S. Choudhry, S. !. Sorabji, D. N. Gupta for the Appellant (In CA No. 1446/72). S. ]. Sorubji, V. !. Taraporawala and K. R. Nambiar for the Appellants (in CA No. 2746/72). ·C G. L. Sanghi and Girish Chandra for the Respondents( ir, both the D E F G H appeals). G. M11/d10ty and H. K. Dutt for Intervener No. l (Inchcck Tyres Ltd.) S . .!. Sorabji, Ravinder Narain, K. K, Master of M/s. 1. B. Dadachanji & Co. for Intervener No. 2. (Firestone Tyres Ltd.). S . .T. Sorabji Ravinder Narain, K . .T . .Toh11 and R .. D. Divan of M/s . .T. B. Dadachanji & Co. for Intervener No. 4 (Burkib Fibres Tyres Ltd.) . /. N. Shroff for Intervener No. 3 and 5 (Ceat Tyres Ltd and Premier Tyres Ltd). The Judgment of the Court was delivered by GoswAMJ, J.-In these appeals by special leave the only question that is raised is whether the substance known as Pyratex-Vinyl Pyridine Latex (for short, V. P. L'atex) is not rubber raw classifiable under item No. 39 of the Indian Tariff Act 1934 (hereinafter referred to as I.C.T.). The appellants are manufacturers of automotive tyres. V. P. Latex is required in the process of manufacturing of tyres. V. P. Latex is not manufactured in India and has to be imported from outside the country. The tyre industry uses V. P. Latex as one of the essential ingredients in the course of manufacture of automotive tyres. The appeliant in Civil Appeal No. 1446 of 1972 imported some time in April, 1969, 3 consignments of V. P. Latex. ln appeal from the proceedings before the Assistant Collector of Customs for appraisemcnt of the said consignments for the purpose of imposition of customs duty and/or countervailing duty, the Appellate Collector of Custom~, Calcutta, upheld the appellant's contention and classified V. P. Latex under item 39 of the I.C.T. as raw rubber. The classification made by the Appellate Collector was revised by the Central Government in ·a proceeding initiated, suo mollt, under section 131 (2) of the Customs Act, 1962. The Central Government held, by the impugned order, that the said V. P. Latex was "an aqueous dispersion of synthetic resin," and hence classifiable under item 87 of I.C.T. prior to 1st March 1970, and thereafter under the new item No. 82(3) I.C.T. • •, • DUNLOP INDIA v. UNION (Goswami, J.) IOI The Central Government by the same order further held that the &aid _goods werl;! liable to countervailing duty under item No. ISA C.E.T. both before and after 1st March, 1970. It is apparent that if V. P. Latex were to be classified under item No. 87, higher duty will be leviable and that is the reason for the controversy in these appeals. In Civil Appeal No. 2746 of 1972, the appeal is directed against the order of August 17, 1972, of the Appellate Collector of Customs, Madras, dismissing a batch of 18 appeals of the Company. The Appellate Collector confirmed the order of the Assistant Collector of Customs Appraising, Madras, rejecting the appellant's claim for refund of duty on the basis th•at V. P. Latex should be cla?sified under item 39 1.C.T. and not under item 82(3) of the LC.T. The appellant did not go in revision before the Central Government. as already similar claims had been rejected by the Central Government. There arc several interveners in the appeals and the entire tyre industry is interested in the matter. Prior to the 1st March, 1970, the First Schedule to the fodian Tariff Act, 1934, contained, inter alia, the following dutiable items Item No. 39 Rubber, raw. Item No. 87 All other articles not otherwise specified. In addition to the above, the following item was introduced in the Tariff Act by the Finance Act, 1970 :- "Item No. 82(3) (a)-Artificial or synthetic resins and plastic materials in any form, whether solid, liquid or pasty, or as powder, granules or flakes, or in the form of moulding powders". Under section 2A of the Tariff Act any article which is imported into India shall be liable to customs duty equal to the excise duty for the time being leviable on a like article if produced or manufactured in India. Such customs duty in addition to the duty under the Tariff Act is known as countervailing duty. Item 15A of the First Schedule to the Central Excises and Salt Act 1944 (briefly C.E.T.) reads as follows:- " l SA : Artificial or Synthetic resins and Plastic Materials and Articles thereof- · ( l) Artificial or synthetic resins and plastic materials in B c () E F any form, whether solid, liquid or pasty, or as powG der, granules or flakes, or in the form of mouldi1ag powders, the following, namely .. " An additional item being item No. 16AA was introduced in the C.E.T. for the first time by the Finance Act 1970, which reads as follows :--· "Item No. 16AA : Synthetic rubber, including butadiene acrylonitrile rubber styrene butadiene rubber and butyl rubber; synthetic rubber latex, including prevulcanised synthetic rubber latex". II A B c D E F c H 102 SUPREME COURT REPORTS [1976] 2 s.c.R. The quantity of V. P. Latex consumed by the tyre industry in India as a whole is said to be about 1000 tonnes per year 'a'ild the value thereof is Rs. 40,33,00.0/- approximately. The appellant, Dunlop India Limited, consumes •about 300 tonnes per year. The controversy between the parties centres round the real meaning of V.P. Latex While the •appellants submit that V. P. Latex is synthetic rubber in the latex form, according to the respondents it is not so, but on the other hand, it is what may be described as 'resin'. ln order that the Court is able to appreciate the rival contentions, both sides addressed us referripg to several standard authorities and treatises. Before we proceed further it may be appropriate to see how rubber is described in the Encyclopaedia Britannica, volume 19, 1965 edition : "RUBBER is the substance caoutchouc (q.v.), a milklike fluid that is obtained from certain tropical shrubs or tyres and then subjected to various processes of manufacture; or it may be a product of chemical synthesis". x x x "The uniqueness of rubber lies in its physical properties of extensibility and toughness. In its natural state, it is greatly affected by temperature, becoming harder when cooled at O~lOC it is opaque and softer when heated (above 50 C. it becomes tackier and less elastic, decomposing into liquid form at 190 -200 C). When vulcanized (i.e. heated with &ulphur at 120 -160 C.) it loses its thermoplasticity and becomes stronger and more elastic." "Chemically, rubber is a polymer of isoprene ......... . x x x x "The term synthetic rubber is used to describe an ever growing number of elastic materials, some of which closely resemble natural rubber while others have completely different physical properties. Since World War II, precise terminology has not kept pace with the rapid developments in the synthetic and plastics industries." x x x x "The copolymerization of the butadiene and the swrene takes place in an emulsion· in the presence of an active t;litiator, such as cumene hydroperoxide and p-menthane hydroperoxide, which allows the conversion to occur at a low temperature (5? C.). SBR is usually prepared with 75% butadiene and 25% styrene; the proportion will, however, vary according to the desired degree of elasticity ....... " Let us consider the appellants' case to treat the V. P. Latex as rubber raw. In this attempt the appellants rely upon several authorities from the rubber world pronouncing upon the chenlical properties as well as various uses and potentialities. Their contention is that V. P. Latex is a synthetic rubber latex and can never be taken for synthetic DUNLOP INDIA v. UNION ( GosWi111li, J.) (03 resin. The principal point to distinguish V. ~· Latex from s;nthc_tic resin is, while synthetic resin cannot. be vulcamsed, ".'· P. L~tex, _be'.n~ rubber can be vulcanised. Accordmg to the American St"ndard tor Testing Material, (A.S.T.M.) raw rubber is d~fincd ~~ crud:? or :111compoundcd rubber, either natural or synthetic. lnlttan Standa1ds Institution (LS.I.) defines rubber as follows :- '"Rubber in its modified state free of all diluents, retracts within one minute to less than l .5 times its original length after being stretched at normal room temperature to twice its length aad held for one minute before release." It also ·defines raw rubber as 'vulcanised rubber'. According to H. J. Stern in his book "Rubber~Natural and Synthetic", V. P. Latex is composed of butadiene styrene and vinyl pyridine in the ratio of 70 : 15 : 15 respectively. A synthetic latex is produced as the first stage in the manufacture of most synthetic rubbers. V. P. Latex is one such sy\1thetic rubber latex. An affidavit sworn by Mr. Mayer, Manager Technical Services; Chemical Division, Goodyear International Corporation, states that V. P. Latex is a terpolyer rubb~r as defined in A.S.T.M. Specification Dic566-60T and that there is no measurable resin content in this product. It is claimed by the appellants that pyratex which is the commercial name for V. P. Latex, imported by them, is exactly similar to the V. P. Latex referred to in Mr. Mayer's affidavit, since it also contains. butadicne styrene and vinyl pyridine in the same proportion of 70 : 15 : 15 with no measurable resin content. It is claimed that V. P. Latex is an emulsion of synthetic rubber and it is borne out by its chemirnl composition and by its physical properties. In the ease of V. P. Latex when coagulated, the coagulum answers fully the A.S.T.M. standards and tests prescribed for rubber. Its use in liquid state is commercially more expedient than its use in dry state. V. P. Latex has been designed as a special synthetic rubber latex to be suitable for its use at the fabric crosslinking stage with rubber compound. It is claimed that in its application it is in no way different from any other natural rubber or synthetic rubber latices. The advantage gained in the case of V. P. Latex is that it is more stable and is not whimsical with reference to man~facturi1~g. c01~ditions. According to G. S. Whitby, the additions of ~JJ:yl pynd111c 111 such terpolymers of butadiene, styrene and viRyl pyndme have been found to improve the characteristics and properties with the increase of vinyl pyridine content and it is kno~~i1 to reach optimum at about 15 parts i.e. at a charge of 75 : 10 : 15. It is further said that vinyl pyridine copolymers suffer from the drawback of extremely high rate of cure, scorching and incompatibility with other rubbers and hence do not find use in the dry state in spite of their certain superior properties. Accordi11g to the appellants' V. P. Latex, ~hen coagulated just like any other rubber latex satisfies the el.ongat1on tests prescribed for rubber. . It is also claimed that in the international field of rubber manufacture, an over ·the world, V. P. Latex is fully recognised as a synthetic· rubber latex and not as a synthetic resm. 8-Ll276 SCf/75 A c [) E F G A B c D E F • H 104 SUPREME COURT REPORTS [ 197 6] 2 S.C.R. The Condensed Chemical Dictionary, 8th edition, 1971, defines latex as a white free-flowing liquid obtained from some species of shrubs or trees in which microscopically small particles or globules of natural rubber are suspended in a watery serum. Natural rubber latex, obtained from the tree Heve a Braziliensis, contains about 60% water, 35% rubber hydrocarbon, and 5% proteins and other substances. Coagulation is prevented by protective colloids, but can be . induced by addition of acetic or formic acid. Synthetic latices include polystyrene, SBR rubber, neoprene, polyvinyl chloride etc. Both natural and synthetic latices are available in vulcanised form. It describes their uses for thin rubber products (surgeons' gloves, drug sundries); girdles, pillows, etc; emulsioR paints; adhesives; tire cord coating; rubber, natural. In the same Dictionary, rubber synthetic is described as follows :- "Any of a group of manmade e1'astomers which approximate one or more of tbc properties of natural rubber. Some of these are sodium polysulfide ('Thikol'); polychloroprene (neoprene); butadiene-styrene copolymers (SBR); acrylonitrile-butadiene copolymers (nitrile rubber); ethylenepropylene-diene (EPDM) rubbers; synthetic polyisoprene ('Coral', 'N atsyn') ; butyl rubber (copolymer of isobutylene and is prene); polyacrylonitrile ('Hycar'); silicone (polysiloxane); cpichlorophydrin; polyurethane ('Vulkollan') ". · Styrene-butadiene rubber (SBR, s. type elastomer)-is the most common type of synthetic rubber., Manufacture involves copolyrnerization of about 3 parts butadiene with 1 part styrene. Its uses are for tiers, footwear, mechanical goods coati,ngs; adhesives; etc. The appellants have also produced the Import Trade Control Policy, Volume I, {or the yeali 1975-76 described during the arguments as the 'Red Book' of the Commerce Ministry of the Government of India. It may be useful to quote the entire entry 150 at page 58 : SECTION II : Policy for individual items and the detailed policy for Actual Users: Part& SI. No. of I.T.C. Schedule 1 150 Description IMPORT POLICY 2 Established Importers 3 Rubber, raw and gutta perNil cha, raw, Actual Users 4 (I) A. U. for import cif Gutta percha, raw. (2) Requirements of actual users for the following items will be met by imports through public sector agency I ~ ~. • 1 DUNLOP INDIA v. UNION (Goswami, .1.) 105 2 3 4 (i) Synthetic rubber namely, Butyl rubber, Acrylonitrile Butadiene Copolymer, Poly 'Chloroprene, Thikol, Cbloroprene, Polybutadiene, Hyplaon,- Viton Polyacrylic, EPDM. Chlonobutyl and Bi·omobutyl, Siliconcrubber and/silicone rubber master batches and Synthetic latex i11c/11di11g Vinyl pyriding latex and copolymer of styrene butadiene latex, Nitrile latex and polychloroprene latex. (ii) Hot type special grades of SBR for manufacture of high impact A B c polystyrene only. D Please see Section III to this Red Book. (3) Import of SBR and/or Alkyl substituted Styrene Butadiene Elastometric Copolymers will not be allowed. (4) Import of· natural rubber and reclaimed rubber will not be allowed. (emphasis added). The earlier Volume of the Import Trade Control Policy, for the year 1969-70, this item 150-Rubber, raw-shows under the fourth column "Actual Users for Synthetic rubber," the following :,-- (i) Import of natural rubber will normally be arranged through STC for meeting the requirements of actu•al users. (ii) AU. for synthetic Rubber namely, Butyl rubber, Acrylonitrile Butadiene Copolymer, Polychloroprene, Thikol, Poly isoprene and Polybutadiene and Syn1hetic latex. x x x x In the Import Trade Control Policy in Volume No. I for the year 197071 against serial No. 150, rubber, raw, under column 4 "Actual Users for Synthetic rubber", actual users are shown as (ii) "AU. (Actual User) for Synthetic Rubber namely, Butyl Rubber, Acrylon-trile Butadiene Copolymer, Poly Chloroprene, Thikol, Poly Isoprene and Polybutadiene Hypalon, SilicO'.ne rubber and Synthetic Latex including: E G H A .B c D I 106 SUPREME COURT REPORTS [l976j 2 S.C.R. Vinyl Py1'i lndia. Condition of the article at the time of importing is a material factor for the purpose of classification as to under what head, duty will be leviable. The reason given by the authority that V.P. Latex • when coagulated as solid rubber cannot be commercially used as an economic proposition, as even admitted by the appellants, is an extraneous consideration _in dealing with the matter. We are, therefore, not required to consider the history and chemistry of synthetic rubber and V.P. Latex as a component of SBR with regard to which extensive arguments were addressed by both sides by quoting from different texts and authorities. It is well established that in interpreting the meaning of words in a taxing statute, the acceptatfon of a particular word by the Trade and its popular meaning should commend itself to the authority. • DUNLOP INDIA v. UN JON (Goswami, J.) 111 Dealing with the meaning· of the term "vegetables'' in the. Exc~se Tax. Act in King v. Planters Nw and Chocolate Company L:11111ed l ·), the Exchequer Court observed as follows :- "'Now the statute affects nearly everyone, the producer or manufacturer, the importer, whole-saler ~nd retailer, and finally, the consumer who, in the last analysis, pays the tax. Parliament WOl!ld not suppose in an Act of this character that manufacturers, producers, importers, consumers, and others who would be affected by the Act, would be botanists. The object of the Excise Tax Act is to raise revenue, and for this purpose t9 class substances according to the general usage and known denominations of trade. In my view, therefore, it is not the botanist's conception as to what constitutes a 'fruit' or 'vegetable' which must govern the interpretation to be placed on the words, but rather what wou!d ordinarily in matters of commerce in Canada be included therein. 13otanic:::ily, oranges and lemons are berries, but otherwise no one would consider .them as such". The Exchequer Court also referred to a pithy sentence from "20 chests of Tea", per Story, J. [(1824) 9 Wheaton (U.S.) 435] that "the Legislature docs not suppose our merchants to be naturalists, or geologists, or botanists''. The above Planters Nut case (supra) was referred to with approval by this Court in Ramavatar B11dlwiprasad etc. v. Assistant Sales Tax Officer("). In Ramavatar's case, this Court was concerned with the meaning of the word 'vegetables' occurring in C.P. and Berar Sales Tax Act, 1947. This Court held as follows :- "But this word must be construed not in any technical sense nor from the botanical point of view but as understood in common parlance. It has not been defined in the Act and being a word of every day use it must be construed in its popular sense meaning 'that sense which people conversant with the subject matter with which the statute is dealing would attribute to it'. It is to be construed as understood in common language". Again in the Commissioner of Sales Tax, Madhya Pradesh, Indore, v. M/s. Jaswant Singh Charan Singh( 3), this Court had to deal with the word 'charcoal' used in Madhya Pradesh General Sales Tax Act. It was contended in that case that 'charcoal' would be covered under Entry I of Part III of Schedule II to that Act. This Court while holding that charcoal would be included in coal, observed as follows :- "Now, there can be no dispute that while coal is technically understood: as a mineral product, charcoal is manufactured by human agency from products like wood and other things. But it is now well-settled that while interpreting items in statutes like the Sales Tax Acts, resort should be had not (I) [1951] Canada Law Reports 122. (2) [1962] 1 S. C.R. 279, (3) A. l. R. 1967 S. C. 1454. \ B c D E F G H A B c 112 SUPREME COURT REPORTS [1976] 2 S.C.R. to the scientific or the technical meaning of such terms but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, to their co1muercial sense". This Court again referred with approval to the decision in Planters Nut case (supra) and followed the principle laid down in Ramavatar's case (supra). In South Bihar Sugar Mills Ltd., etc. v. Union of India & Ors.,(') the question that was raised related to item 1'4-H in the Schedule I to the Central Excise & Salt Act, 1944, which contained compressed, liquified or solidified gases, inter alia,. Carbon acid (carbon dioxide). This Court observed as follows :- "It is also not correct to say that because the sugar manufacturer wants carbon dioxide for carbonation purpose and sets up a kiln for it that he produces carbon dioxide and not kiln gas.