[Order per : A.C.C. Unni, Member (J)]. - These two appeals filed by the above appellants were heard together as some of the points were common in both the appeals.

2. We have heard Shri A.K. Jain, ld. Advocate for the appellants and Shri K. Srivastava, ld. SDR for the respondent Collector.

3. We take up the two appeals separately for consideration.

Re : A. No. 2070/97-C

This appeal is against the order-in-appeal dated 1-10-1997 passed by the Commissioner of Central Excise (Appeals) Allahabad which went into the question of the correct classification of 'liquid gold' manufactured by the appellants. The Collector (Appeals) confirmed the order-in-original passed by the Assistant Collector, Agra under which he classified the product under Chapter heading 3207.90 and rejected the claim of the appellants for classifying the item under Chapter 71 of the Schedule to the Central Excise Tariff Act, 1985.

5. Appellants are manufacturers of 'liquid gold' and additives at their factory at Agra. They filed a declaration under Rule 173B for the year 1995-96 classifying their products under Chapter 3207.90 attracting Central Excise duty at the rate of 20%. The declaration was approved by the Range Superintendent on 15-1-1996. Subsequently, on 1-4-1996 appellants filed another declaration under Rule 173B for the year 1996-97 seeking to classify the product under Chapter 71 which attracted nil rate of duty.

6. The matter was adjudicated by the Assistant Commissioner who by his order-in-original dated 12-12-1996 rejected the claim of the assessee for classification of their product under heading 107.39 (sic) and held that the goods were classifiable under Chapter Heading 3207.90. The Assistant Commissioner observed that the assessee's claim for classification of 'liquid gold' under Chapter 71 was based on their claim that liquid gold was an alloy of gold. After referring to the Dictionary meaning of "alloy", the Assistant Commissioner found that alloy is a substance composed of one or two metals or non-metal components intimately united. It should have metallic properties. He observed that liquid gold was basically a colloidal solution and had been aptly held as a chemical in the case of Indian Ceramic House v. Commissioner of Sales Tax [1970 (26) STC 113 (All.)]. He held that 'liquid gold' cannot be termed as an alloy because it neither had metallic property nor was it an intimate union of non-metallic components. He also referred to the exclusion of goods falling under Chapter 32 (such as lustres) vide Chapter Note 1(c) of Chapter 71.

7. In the Order-in-Appeal, Commissioner (Appeals) observed that the judgment of the Allahabad High Court in the case of Shri Ratan Lal Garg relied on by the assessee related to the question of validity of seizure of liquid gold under the Defence of India Rules under which gold could be seized, and not with classification under Central Excise Tariff Act. Commissioner (Appeals) relied on the Tribunal decision in the case of National Gold Industries (which were an associate firm of the appellants) reported in wherein the Tribunal had dealt with the classification aspect and held that liquid gold can be considered as a ceramic colour. Tribunal had therefore held that 'liquid gold' was classifiable under Chapter Heading 3207.90 as ceramic colour. He also agreed with the Assistant Commissioner's findings that Chapter Note 1(c) of Chapter 71 excluded goods falling under Chapter 32, like lustres.

8. Ld. Counsel for the appellants has contended before us that the authorities below have wrongly held that the Allahabad High Court judgment in Ratan Lal Garg case was not applicable to the present facts. He contended that the Allahabad High Court judgment in the above case had held that liquid gold is a 'thing' manufactured from gold and therefore an 'article' of gold for purposes of the Defence of India Rules. Therefore, the item under dispute in the present case, namely, liquid gold clearly fell under Chapter 71 as an 'article' of gold and the appellants were eligible for duty exemption under Notification No. 4/97 after 1-3-1997 and under Notification Nos. 39/94, 54/97 during the earlier periods. He submitted that the definition in the said Central Excise Notifications of "articles in relation to gold" as including "anything other than ornaments in a finished form, made of, manufactured from or containing gold......." was in pari materia with the definition given in the Gold (Control) Act. Therefore, the Allahabad High Court decision in Ratan Lal Garg case would clearly apply to the interpretation of the same expression in the CEGAT Notification though the said High Court decision might have been given in the context of Defence of India Rules, 1962. Further, the respondent Commissioner being within the jurisdiction of the Hon'ble Allahabad High Court, all rulings of the jurisdictional High Court would be binding on him. It was also contended that as per the Customs Notification No. 117/94, dated 27-4-1994 gold in any form including liquid gold would be classifiable under Chapter 71.

9. Ld. Counsel further submitted that the Allahabad High Court had already held in Indian Ceramic House v. Commissioner of Sales Tax [1970 (26) STC 413] that liquid gold was a chemical and was taxable as a chemical and not as a bullion under the U.P. Sales Tax Act, 1948. Chemicals came under Chapter 28 of the Central Excise Tariff. There was no contrary judgment of any other High Court. Further, items covered under Chapter 32 of the Central Excise Tariff could not include items covered by Chapter 28. He also referred to Notification No. 39/85 which covered 3 Chapters, namely, Chapters 25, 28 and 32. However, before the item 'ceramic colour' no Chapter number had been put. Moreover, in terms of interpretative Rule 3, since Chapter 72 came subsequent to Chapter 28, a combination of solvent and gold will not fall under Chapter 72. Even HSN Explanation Notes under Chapter 32 did not cover liquid gold since gold used in the making of liquid gold was not a compound of metal.

10. In reply, ld. SDR submitted that the dispute in the present appeal relate to the question of classification of liquid gold under the Central Excise Act. Whereas the Department has taken the view and which has been confirmed by the authorities below, that liquid gold will be classifiable under Chapter sub-heading 3207.90, the appellants' contentions is that the said product would be classifiable under Chapter 71. He submitted that the appellants themselves had classified the impugned goods under Chapter sub-heading 3207.90 initially. He submitted that reliance placed on the two decisions of Allahabad High Court namely Ratan Lal Garg v. Collector and Indian Ceramic House v. Commissioner of Sales Tax did not relate to a dispute relating to classification of liquid gold under the Central Excise Act. In the Ratan Lal Garg case, the question was whether liquid gold was gold for purposes of Defence of India Rules. Though the definition of the expression 'article' used in the Defence of India Rules, 1996, may be in pari materia with the definition of article in the relevant Central Excise Notifications, the interpretation of the said definition for purposes of Defence of India Rules cannot be accepted as a binding interpretation for purposes of classification of the said item under the Central Excise Tariff since the object of the two enactments were quite different. The other decision relied on by the appellants, namely, the decision of the Allahabad High Court in India Ceramic House v. Commissioner of Sales Tax reported in 1970 (26) STC 413 also would not be binding on the Central Excise authorities since the said judgment was in relation to a dispute arising from the UP Sales Tax Act, 1948 and not under the Central Excise Act. On the other hand the Tribunal had in the case of National Gold Industries reported in held that liquid gold can be considered as ceramic colour. He reiterated the finding of the authorities below holding that the specific Chapter sub-heading 3207.90 covered the item in dispute and such items were excluded under Chapter Note 1(c) of Chapter 71.

11. We have considered the submissions and perused the records. We find no merit in the submissions made on behalf of the appellants that the Allahabad High Court judgment relied on by them would be applicable to the facts of the present case and the question raised herein. The dispute presently before us is in relation to classification of liquid gold for purposes of the Central Excise Tariff Act. The interpretation given to an expression used in another statute or Rules made thereunder will not have binding effect on the authorities administering/adjudicating a matter under a different statute or Rules made thereunder. Any definition in any statute is primarily meant for the interpretation of the provisions of that statute. Even where the definition per se may be in pari materia with a definition given in another statute, the interpretation given in the context of one statute can have only pursuasive value in interpretating the definition in another statute for the obvious reason that each definition has to be seen and interpreted in the context of the legislation in which it occurs and each definition has to be read as part of the main legislation where it occurs and not in relation to another piece of legislation. We are therefore unable to accept the contention of the ld. Counsel that the jurisdictional High Court in the present case being the same, for purposes of Central Excise Act, the judgment given by the jurisdictional High Court even if it relates to a different legislation, would apply automatically by its own force to a classification dispute under the Central Excise Act.

12. On the merits of the case, we find that the process of manufacture of liquid gold has been dealt with in detail in the Allahabad High Court judgment in Rattan Lal Garg case and it has been explained that liquid gold was not gold since after its manufacture it has become a compound of gold and not an alloy of gold. Chapter 71 which includes precious metals and articles thereof would cover goods which have metallic content. Liquid gold having lost its metallic content in any identifiable form because of its chemical constitution would be more appropriately classifiable under Chapter 32 covering dyes, colours, paints, etc., forming part of Section VI of the Central Excise Tariff Act consisting of Products of chemical or allied industries.

13. In view of the above discussion, we upheld the classification of liquid gold under Chapter sub-heading 3207.90 as held by the authorities below. The appeal No. E/2070/97-C filed by M/s. Zarafshan Chemicals Pvt. Ltd. is accordingly dismissed.

Re: Appeal No. E/2071/97-C.

14. In this Appeal, the issue involved is whether appellants M/s. Zarafshan Chemicals Pvt. Ltd. are entitled to the benefit of Small Scale Exemption Notification No. 1/93-CE. The appellants had contended that 'liquid gold' with brand name "Golden Oriole" manufactured by them was their own brand name as per the deed of assignment dated 3-4-1994 executed by the earlier owners of the original brand name, M/s. National Gold Industries. The Adjudicating Authority by Order-in-Original dated 30-11-1995 had accepted the appellants' contention and had dropped the SCN and seizure of a certain quantity of liquid gold found in the appellant’s factory. However, when the matter was considered by the Commissioner (Appeals) against the said adjudication order, the Commissioner (Appeals) set aside the Order-in-Original and allowed the Departmental Appeal.

15. As regards the present appellants' claim that they had become owners of the brand name "Golden Oriole", the Commissioner (Appeals) noted that Shri Syad Zaki Israti, Managing Director of the appellant firm could not categorically state whether the brand name was owned by them or by M/s. National Gold Industries when the Officers visited the appellant's factory on 10-8-1994. The Commissioner (Appeals) observed that if the brand name had been transferred by M/s. National Gold Industries to the appellants by deed of assignment on 3-4-1993, and if such deed was actually in existence, nothing prevented the appellants from producing it before the Investigating Officers. Further, the Commissioner (Appeals) had found that the appellants had submitted the application for registration of "Golden Oriole" brand name in their name only on 24-2-1995, about six months after the seizure of the quantity of liquid gold from the appellant's factory by the Officers. He also observed that since one of the partners of M/s. National Gold Industries was the daughter of the Managing Director of the appellant firm, the possibility of back dating the assignment deed could not be ruled out. Commissioner (Appeals) noted that the Managing Director had stated that if he failed to furnish information regarding the authority given to the appellants by M/s. National Gold Industries for using their brand name within 15 days from the date of recording of the statement, then it may be treated that they did not have any such authority. Having regard to these facts Commissioner (Appeals) came to the conclusion that the deed of assignment dated 3-4-1993 was only an afterthought created as a cover up measure. Reliance was placed on the Bombay High Court judgment in the matter of State v. Genu Yaswant Divate reported in (Bom.) and the Tribunal decision in M/s. L.M.L. v. CCE reported in (T) to contend that belated submission of evidence is not acceptable and should be considered an after thought.

16. The appellants have argued that as per the deed of assignment the right, title and interest together with the goodwill of their brand name had been transferred by M/s. National Gold Industries to the appellants on 3-4-1993. The Commissioner (Appeals) could not have dismissed the said documentary evidence just because the Managing Director could not produce the same at the time of making his statement. The onus to prove that the said deed of assignment was ante-dated was on the Department. The said documentary evidence could not be dismissed merely on the basis of conjectures or on the suspicion that since one of the partners of M/s. National Gold Industries was closely related to the appellants' Managing Director the possibility of the deed of assignment being created was a cover up measure.

17. Ld. SDR, Shri K. Srivastava reiterated the findings of the first Appellate Authority.

18. We have considered the submissions and have perused the records. We find that the Commissioner (Appeals) has rejected the appellant's claim to the ownership of the brand name "Golden Oriole" merely on the ground that the Managing Director of the appellant firm could not produce a copy of the agreement on the date of seizure. The Commissioner (Appeals) had taken the view that if the said deed was in existence on 3-4-1993, nothing prevented the appellants from producing it before the visiting Officers. His further observation was that since the partners of both the firms were close relations, the possibility of the said document having been created as an afterthought could not be dismissed. We find that the observations made in the impugned order are based merely on suspicion and speculation and not on the basis of any evidence, it is well settled that where documentary evidence is produced, it is impermissible to dismiss its evidentiary value on the basis of oral statement to be contrary. The appellant's submission is that the Commissioner (Appeals) has rejected the deed of assignment without any basis or evidence. We find force in this argument. We feel that it was for the Department to disprove the claim and to establish that the deed of assignment, though dated 3-4-1993 was in fact executed after the date of seizure. Without establishing this, the assignment deed cannot be brushed aside. In the above set of facts, the impugned order cannot sustain and has to be set aside. We therefore hold that appellants' claim to be owners of the brand name "Golden Oriole" on the date of visit of the officers to the appellant's factory on 10-8-1994 is established on the basis of the assignment deed and accordingly, they were entitled to the benefit of Notification No. 1/93.

19. The appellants had claimed that even otherwise the benefit of Notfn. 1/93 could not have been denied to them since their clearances were within the exemption limit of Rs. 30 lakhs and no duty demand could have been made. There is no finding on this aspect in the impugned order.

20. Since we have held that the appellants would be entitled to the benefit of Notfn. 1/93-CE in view of the deed of assignment dated 3-4-1993, the consequential benefits will be admissible to the appellants subject to the other conditions of Notfn. 1/93-CE.

21. Appeal No. E/2071/97-C is disposed of in the above terms.