2007 PLP 1907 (SCMR)

KARAMAT NAZIR BHANDARI, J.

Respondent No.1/its predecessor Messrs Far Eastern Impex, a partnership concern has been dealing in the business of packing, re-packing and selling completely manufactured synthetic organic Dye Stuff commonly known as `Food Colours'. "Food colours" are edible and are used for food preparation. Since 1974, clearance of food colours was being permitted without payment of excise duty. For the first time in the year 1989 respondent No.1 was asked to file the relevant return and pay excise duty. The arrears amounting to Rs.12,65,173.39 were also demanded for the period between 15-4-1985 to 15-6-1988. By another letter, a demand in the sum of Rs.6,15,898.43 was made for the period from July; 1988 to June, 1989. The respondent No.1 challenged the demand in the hierarchy by way of appeal and revisions without any success. Application of respondent No.1 for exemption under section 12(b), of the Central Excise & Sales Act, 1944 was also rejected and the demand for payment of the arrears was reiterated. This led respondent No.1 to challenge the action/demand in the High Court of Sindh and Karachi by filing Constitutional petition (C.P. No.D-22 of 2000). This petition was allowed vide judgment date 28-12-2001 by a learned Division Bench of the Court. After setting aside the order, the Court directed refund of the recovered amounts. The petitioners solicit leave to appeal from the afore-said judgment.

2. The fate of the case hinges on the language of Item No. 04.03 of the Schedule to the Central Excise and Sales Act, 1944. This Item appears in section IV headed "PRODUCTS OF CHEMICAL AND ALLIED INDUSTRIES" The item is reproduced:-- 1 2 3 "04.03" Paints, Pigments, Varnishes and Polishes-- All sorts of paints (including products known as or used or cement paints), pigments, distempers, colours, dyes, enamels, varnishes, glazes lusters, thinners blacks, cellulose lacquers and polishes (except creams and polishes falling under Item No.04.01) and their ancillaries, in any form, liquid, solid, semi-solid, paste, powder of granules-- (i) if retail price and quantity are legibly, prominently and indelibly, printed on each container or package; 22 per cent of the retail price (ii) If not covered by clause (i) 200 per cent. ad valorem

3. A bare reading indicates that the Item covers all sorts of paints, distempers, dyes, colours, enamels and .varnishes etc. Learned counsel for the petitioners has attempted to show that the subject goods fall within the expression "colours". The argument is naive, to say the least. The expression "colours" has to be interpreted keeping in view the heading of Item No.04.03 namely "paints, pigments, varnishes and polishes". The edible colour is altogether a different species and has no connection whatsoever with paints, pigments, varnished and polishes.

4. No fault whatsoever can be found in the impugned judgment of the High Court. We hold this petition as frivolous and while refusing leave to appeal, dismiss the same. H.B.T./C-23/SC Petition dismissed