ivil Appeal No 1130 of 1990
From the Judgment and Order dated 1961989 of the Patna High Court in LPA No 51 of 1987
GB Pai SK Patri and JR Das for the Appellant
Dr SK Ghose Mrs M Qammaruddin and M Qammaruddin NP for the Respondents
The Judgment of the Court was delivered by 404 K JAGANNATHA SHETTY J
Special Leave granted
Whether International Labour Day 1st May should be paid holiday in addition to the existing holidays for the employees of the appellant Company is the sole question for determination in this appeal
The appellant is a public limited company having manufacturing units and selling outlets in the different parts of the country
In the State of Bihar the company has an establishment at Mona Road Burma Mines Jamshedpur manufacturing Industrial and Medical Cases and there is another establishment located at Ranchi manufacturing liquid Oxygen Explosives
The holidays available to the employees of the company s establishment are provided by the settlement dated 14 March 1971
The settlement provides for a total number of 13 holidays for office staff and 14 holidays for the factory staff
The relevant portion of the settlement reads Provision of Settlement dated 143
1971 ARTICLE Leave and Holidays c The number of NationalFestival Holidays to which the factory staff and factory general staff are entitled will be enhanced from the present number of 10 to 14 days including 3 National Holidays viz Republic Day Independence Day Mahatma Gandhi s birthday and Viswakarma Puja
d The number of NationalFestival holidays for office and office general staff will be enhanced from 17 to 18 days per calendar year including 3 National Holidays viz Republic Day Independence Day and Mahatma Gandhi s birthday
 In 1977 the State of Bihar enacted the Bihar Indus trial Establishments National and Festival Holidays and Casual Leave Act 1971 Act No 17 of 1977 called shortly as the Act  making provisions for NationalFestival holi days and casual leave for workers
We are concerned with Sections 3 and 13 of the Act which must be set out in full Section 3 405 National and Festival Holidays 1 Every employee shall be granted following in each calen dar year in such manner and on such terms and conditions as may be prescribed a Three National Holidays on the 26th January 15th August and 2nd October
b Four other holidays on any festival out of the festivals mentioned in the schedule
c International Labour Day on 1st May 2 The Government may add to or exclude a festival from the Schedule by a notification in the official Gazette and on publication of such notification the Schedule shall be deemed to be amended accordingly Section 13 of the Act  Right and privileges Under any other law not to be affect ed Where any employee of an industrial establishment is entitled to such rights and privileges under any other law for the time being in force or under any contract or custom or usage applying to the said establishment which are more favourable to him than any right and privileges conferred by this Act nothing contained in this Act shall affect such rights or privileges
 It will be convenient if at this stage we also read sub rule 3 of the Rule 32 of the Bihar Rules framed under Section 14 of the Act Rule 3
National Festival Holidays 1 xxx xxx xxx 2 Each employer of an industrial establishment shall at the beginning of each calendar year or within 60 days from the date of commencement of work in the case of new indus trial establishments display a notice asking his employees to indicate their choice in respect of 4 festival holidays out of the list of festival holidays mentioned in the 406 schedule under sub section 1b of Section 3 of the Act
 Section 3 makes it mandatory to declare holidays on 6th January 15th August 1st May and 2nd October besides 4 other holidays on festivals out of the festivals mentioned in the schedule
Subrule 2 of rule 3 provides procedure for fixing the four festival holidays at the beginning of each calendar year
The employer shall display a notice asking his employees to indicate their choice in respect ot 4 festival holidays out of the list of festival holidays mentioned in the schedule to section 31b
Section 13 provides that the rights and privileges of the workmen under any other law or under any contract or custom or usage applicable to the establishment which are more favourable to the workmen than that conferred by the Act shall not be affected
Since the employees of the compa ny s establishment at Jamshedpur were allowed more favour able holidays every year ie 18 for office staff and 14 for factory staff against the total of 3 holidays provided for in the Act the company wanted to declare the first May as holiday by adjusting the holidays allowed in the settle ment The workmen however took the stand that the first May should not be adjusted within the total number of holi days provided in the settlement but should be given as an additional holiday
Negotiations followed but neither side was willing to give up its claim
The conciliation officer could not bring about settlement
Upon failure of conciliation the statuto ry authorities directed the company to declare 1st May as holiday in addition to the holidays provided for in the settlement
The company moved the High Court under Article 226 of the Constitution challenging the direction of the authorities
The High Court dismissed the writ petition observing thus Under the existing arrangement the employees are having 1418 paid holidays in an year and that cannot be defeated by Section 3 of the Act
But section 13 expressly provides that if the rights and privileges in respect of paid holi days enjoyed by the employees are more favourable than are prescribed by section 3 their existing rights and privi leges as to the total number of holidays will not be preju diced by section 3
It is clear that section 3 is not in tended to prescribe a minimum number of paid holidays in addition to the existing ones
The holiday on the 1st May prescribed under the Act being compulsory in nature 407 therefore must be in addition to the privileges already granted to the workmen under the agreement
 We are afraid we cannot agree with this line of reason ing adopted by the High Court
In fact the conclusion and the reasoning seem to be inconsistent with each other
Section 3 provides for three National holidays one Interna tional Labour Day and four festival holidays
It thus statutorily fixeseight paid holidays four out of them are left to the choice of the management and employees for festival occasions
These eight holidays however are not in addition to the holidays that are mutually agreed upon in the settlement
They are the minimum holidays which the employees are entitled to
If there is existing settlement by which the employees are entitled to more than eight holidays the management could not take away that rights and privileges
To protect the employees in such cases the Statute intervenes by Section 13
If the employees are entitled to more than eight holidays  under any contract or usage applicable to the said establishment or under any other law for the time being in force that rights and privi leges are saved by section 13
This seems to be the require ment of the statute
The case with not a dissimilar problem was in Tata Oil Mills Co vs KV Gopalan  Ors
 There this Court considered the scheme and scope of sections 3 and 11 of the Kerala Industrial Establishment National and Festival Holidays which are similar in terms with sections 3 and 13 of the Act with which we are concerned
Section 3 of the Kerala Act provides Grant of National and Festival holidays Every employee shall be allowed in each calendar year a holiday of one full day on the 26th January 15th August and the 1st May and four other holidays each of one whole day for such festivals as the Inspector may in consultation with the employer and the employees specify in respect of any industrial establishment Section 11 of the Kerala Act reads Rights and privileges under other laws etc
are not 408 affected Nothing contained in this Act shall adversely affect any rights or privileges which any employee is enti tled to with respect to national and festival holidays on the date on which this Act comes into force under any other law contract custom or usage if such right or privileges are more favourable to him that those to which he would be entitled under this Act
 Considering the rights of workmen under those provisions Gajendragadkar CJ speaking for this Court observed at 764 If under the existing arrangement the employees are enti tled to have more than 7 paid holidays that right will not be defeated by section 3 because section 11 expressly provides that if the rights or privileges in respect of paid holidays enjoyed by the employees are more favourable than are pre scribed by section 3 their existing rights and privileges as to the total number of holidays will not be prejudiced by section 3
The scheme of section 11 thus clearly shows that section 3 is not intended to prescribe a minimum number of paid holidays in addition to the existing ones so that the respondents should be entitled to claim the seven holidays prescribed by section 3 plus the six holidays to which they are entitled under the existing arrangement
 In the present case it may be relevant to note that the festival holidays have not been identified or specified in the settlement
They have to be selected and declared as holidays with notice to employees every year
It is only three National holidays that have been specified therein in addition to Vishwakarma Puja day for the factory staff and factory general staff
Now the statute prescribes the same three National holidays besides International Labour Day and four festival holidays
But these 3 holidays are not to the exclusion of or in addition to the total number of holidays agreed upon under the settlement
Indeed it could not be so since three National holidays are common both in the settlement and statute
The total number of 14 holidays under the settlement as against 3 holidays under the statute remains undisturbed by section 13 of the Act since it is more favourable to the employees than the rights and privi leges conferred by the Act
When thus being the position the management would be entitled to adjust the International Labour Day as a paid holiday within the fourteen days al lowed underthe settlement
The demand of the employees that 409 it should be in addition to fourteen days has no support either under the settlement or by the terminology of the statute
In the result the appeal is allowed
The judgment of the High Court is set aside
There will be however no order as to costs
NPV Appeal allowed


Summary:
The appellant on behalf of his firm which is engaged in processing of stone slabs placed an order for calcareous stone other than marble with the exporter in Italy and asked the exporter to certify that the said goods were not marble
The appellant further obtained from the foreign exporter a sample tile and had the same tested by a reputed geologist who confirmed that the sample was not marble
The goods were imported under OGL Appendix 6 Item I of Import and Export Policy for April 1988 March 1991
The Customs Department sent sealed samples of the im ported goods for testing to various technical authorities and on the basis of some of these reportsopinionsvisual observations issued a show cause notice to the appellant alleging that the calcareous stone were nothing but marble only as per the commercial definition of marble and there fore governed by Entry 62 Appendix 2 Part B of the Import lant s contention was that the said goods could not be regarded as marble  in terms of the expression marble  appearing in heading 2515 in Schedule 1
Appendix I B Customs Tariff Amendment Act 1985
The Collector of Customs however passed an order that the goods imported were marble requiring a specific import licence
The Collector further ordered confiscation of the goods and imposition of fine and penalty
The Customs Excise and Gold Control Appellate Tribunal dismissed the appellant s appeal but reduced the penalty amount
370 Before this Court it was contended on behalf of the appel lant that 1 for the purpose of understanding the meaning of marble  occurring in Appendix 1 B Schedule I of the Im ports Control Order 1955 it is necessary to refer to Mineral Products in Chapter 25 Tariff Entry No 2515
the term marble  therein does not occur by itself or in isolation bal as an inseverable part of a Tariff Entry which deals with five items a Marble b Travertine c Ecaussine d Other calcareous stone Alabaster the Tariff Entry draws a clear line of distinction between each of these five items and regards them as five distinct products 4 the term marble  has to be given a meaning which fits in and harmonises in the above mentioned statutory context so that marble  continues to remain distinct and different from the said other four items though the general principle of interpretation of tariff entries occurring in a tax statute is that of commer cial nomenclature or understanding in the trade the said doctrine or commercial nomenclature or trade understanding can and should be departed from in a case where the statuto ry context in which the tariff item appears requires such a departure 6 the principles of interpretation are never embodied rules and the same must always yield to the context of the particular statute 7 as the word marble  has not been defined and the tariff item refers to calcareous stone of an apparent spe cific gravity of 25 or more has to be taken to be used in a technical and scientific sense and as such the same cannot be interpreted in the popular commercial sense the end use of the particular product is irrelevant and of no consequence for determining its classification and 9 if the term marble  is to be given the commercial meaning as relied upon by the Customs Authorities then the inevitable consequence would be that the term marble  in Chapter Heading 2515 would automatically include within it the other four items thereby rendering the rest of the Tariff Entry otiose redundant and meaningless
371 On behalf of the Revenue it was contended that 1 the word marble  has not been defined in the Tariff Act and as such in interpreting the word marble  as men tioned in Tariff Item No 2515 in Appendix 1 B Schedule 1 to the Import Control Order 1955 the test in commercial and trade parlance has to be applied ie how the said product came to be commercially known by the trading people 2 it is not a scientific or technical word and as such it does not require to be interpreted in its scientific and technical sense 3 the word marble  if so interpreted will include calcareous stone of 25 or more specific gravity 4 marble is the genus and all other four items of stone mentioned in Tariff Entry 2515 which are of apparent specific gravity of 25 are included within marble as they are commercially and in trade parlance known as marble and 5 the end use of the product ie marble and calcare ous stone has to be taken into consideration in the determi nation of the other items of stone mentioned in that Entry
Allowing the appeal this Court HELD 1 According to a number of reports as well as the ISI specification the slabs of rocks that have been imported by the appellant and claimed to be calcareous stones are not marble  in the scientific and technical sense of the term marble 
387F G 2 Calcareous stone as mentioned in ITC Schedule has to be taken in scientific and technical sense as therein the said stone has been described as of an apparent specific gravity of 25 or more
Therefore the word marble  has to be interpreted in the scientific or technical sense and not in the sense as commercially understood or as meant in the trade parlance
388D E 4
The general principle of interpretation of tariff entries occurring in a tax statute is that of commercial nomenclature or understanding in the trade
The said doc trine of commercial nomenclature or understanding can and should be departed from in a case where the statutory con tent in which the tariff item appears requires such a de 372 parture
If the application of the commercial meaning of trade nomenclature runs counter to the statutory context then the said principle of interpretation cannot and should not be applied
388E F 5 Trade meaning or commercial nomenclature would be applicable if a particular product description occurs by itself in a Tariff Entry and there is no conflict between the Tariff Entry and any other Entry requiring to reconcile and harmonise that Tariff Entry with any other Entry
388G Union of India vs Delhi Cloth  General Mills 1963 Supp 1 SCR 586 Dunlop India Ltd vs Union of India  Ors   Commissioner of Sales Tax MP vs Jaswant Singh Charan Singh   Grenfell vs Inland Revenue Commissioner  248 Holt  Co vs Collyer  720 KV Varkey vs Agri cultural Income Tax and Rural Sales Tax Officer 1954 5 STC 384 Cannanore Spinning and Weaving Mills Ltd vs Col lector of Customs and Central Excise Cochin   Collector of Central Excise Kanpur vs Krishna Carbon Paper Co   Collector of Customs Bombay vs Hargovindas  Co 1987 29 LET 975 and Collector of Cus toms Bombay vs Swastic Woollens P Ltd and Ors 1988 Supp SCC 796 referred to
6 The commercial nomenclature or trade meaning cannot be given to marble in as much as such a meaning if given will render otiose and redundant the terms travertine ecaussine alabaster and other calcareous monumental or building stone of an apparent specific gravity of 25 or more whether or not roughly trimmed or merely cut by sawing
397F G 7 In interpreting a product its end use is of no relevance in determining the classification because in interpreting a term appearing in the Tariff Item which has not been defined either in the Tariff Schedule or in the Import Control Order the same is to be interpreted in such a way which is in consonance with the Items specified in the ITC Schedule without leaving out any part of the Items mentioned therein
399A B 8 Considering all the reports and since the term marble  has not been defined in the Imports Control Order as well as in the ITC Schedule it has to be taken in a scientific and technical sense as well as in the context the word has been used and the slabs of calcareous stones imported by the appellant from Italy cannot be held to be marble as they have not been recrystallised and metamor phosed in the geological and petrological sense of the term
398F 373 9 The slabs of calcareous stone imported by the appel lant are not marble as mentioned in Entry No 62 of Appendix 2 of the Import and Export Policy for April 1988 March 1991 and so it is covered by Open General Licence
399G 10 The imported goods cannot be confiscated by the Government under Section IIId of the Customs Act 1961 nor the appellant can be given the option to clear the said goods for home consumption on payment of fine in lieu of confiscation under Section 125 of the 
399H 400A 11 The appellant cannot be said to have imported calcareous stones without an import licence and as such there being no violation of the Import Control Policy the imposition of penalty under Section 112 of the is unwarranted and not sustainable
400A 12 Even if it is taken for arguments sake that the imported article is marble falling within Entry 62 of Appen dix 2 the burden lies on the Customs Department to show that the appellant has acted dishonestly or contumaciously or with the deliberate or distinct object of breaching the law
In the instant case in view of the finding arrived at by the Appellate Tribunal that the said product was imported on a bona fide belief that it was not marble the imposition of such a heavy fine is not at all warranted and justified
400B C 401A B Merck Spares vs Collector of Central Excise  Customs Delhi  Shama Engine Valves Ltd Bombay vs Collector of Customs Bombay  Madhusu dan Gordhandas  Co vs Collector of Customs Bombay and Hindustan Steel Ltd vs State of Orissa 1970 1 SCR 753 referred to