Manash Nath Roy, J. - (1.) "Fonokam'' is, .ads name of what the petitioner,, Radio (Supply Stones (p) Ltd has described as a telephone for internal' communication and has also stated to have manu factured the same since April, 1975. It was the case of petitioner that such product "Fonokom" operates independent of the public telephone exchange and such product, is popularly know as intercom telephones. The petitioner has stated that because of the use and manner of operation such product "Fonokom" would fall or come under the category of office machine and apparatus under the Indian Customs and Central Excise (Tariff) and more particularly under item No. 33D.
(2.) The petitioner is a limited company incorporated under the Indian Companies Act, 1912 as was established in 1927. The petitioner is stated to be carrying on business in electronic appliances and also deals with compo nent parts of such appliances and other electrical goods. It has also been claimed that the petitioner has been duly registered as small-scale manufacturing unit and the licence for manufacturing of office machines and apparatus, which include electronic calculator and intercom devices, under the Central Excises Act and Rules (hereinafter referred to as the said act and the said Rules) in or about'1974 and since then they are continuing with or carrying on the manufacture of the products "Fonokom" It was the case of the petitioner that, they adverrtised the product "Fonokom" and displayed such item for the use as mentioned above and have sold the same to various customers including the Government and other statuory bodies.
(3.) "Telephony" means the transmission of speech in a distance by means of the electric current. The process involves the use of a transmitter into which the message is spoken, a battery, conductors to connect the two stations and a receiver in which, the message is heard. "'Telephone" according to Chamber's Dictionary, is an instrument for reproducing sound at a distance, by means of electricity and according to Webster's, an instru-ment for reproducing sound at a distance Which' sound is converted into electrical impulses for transmission by wire. According to Oxford Dictionary, "Telephone" is an apparatus for transmitting speech or other sound to distant, hearer especially , by electricity, a system of comminication by its means and having the instrument connected with others. On the basis of the definitions and the manner of user, Mr. Basu pleaded the product "Fonokom" being a telephone, though falling under the category of intercom-devices, is not excisable under Tariff Item No.33D and more particularly whereunder such item "telephones" have been specifically exempted from excise duty, whereas other intercom-devices are excisable under the said tariff. Under the said tariff Item No.33D in fact all types of intercom-devices except telephones are excisable. thus, Mr. Basu categorically Claimed that the product "Fonokom" which are "master" telephones, that is to say, any station can call any other station and which is a self-operated transistorised and push button intercom telephone system and cannot be connected to the public exchange, should be exempted under the said tariff item It was also claimed that since "Fonokom" operates independent of the public telephone exchange and they fall under the category of office machines and apparatus under the Indian Customs and Central Excise Tariff item No.33Das mentioned above, would not be excisable. Mr. Basu, of course, stated that intercom-devices are excisable under the said tariff, whereunder all types of intercom-devices except telephones are excisable. It was the further case of the petitioner that since "Fonokom" was not chargeable to excise duty, since their production in 1975, the petitioner had no occasion to pay any excise duty for the same. It has been alleged by the petitioner that Central Excise Inspectors verbally informed that "Fonokom" being an exempted item, would not be excisable under the said Act or the said Rules. Such statements have been affirmed as submissions of the deponent Charu Prokash Ghose, the Managing Director of the petitioner. In view of the manner of affirmation and also because of the fact that the deponent has not mentioned the name of the Central Excise Inspectors, who gave him such assurances and also because of the denial of such statements by Shri Jagadish Chandra Dey, the Assistant Collector of Central Excise, respondent No. 4, as made in the respondents' affidavit-in-opposition dated 14th Jan., 1981 no reliance can or should be placed on those statements. It has also been claimed by the petitioner that the Indian Telephone Industries, Bangalore, do not pay any excise duty on the similar type of telephone they manufacture for inter-communications, which again, as in this case, cannot be connected with the public exchange and the products of the said Industry as mentioned above are sold to the public and the said Industry, having more than the required number of employees or at least more than the petitioner, pays 1 per cent excise duty under the said Act and in terms of Tariff Item No. 68.;