Case: Minerals &amp; Metals Trading Corporation Ofindia Ltd Vs. Union Of India &amp; Others

without which it is not regarded as an acceptable wolfram ore or wolfram concentrate and useless to consuming industries. Basic operations bringing the material to such a standard are not a manufacturing process but from part of normal wolframite mining activities".According to a letter dated February 3, 1965 from the Director of National Metallurgical Laboratory to the Controller of Customs wolfram ore is always selectively mined in the technical terminology. The selectively mined tungsten contains about 70% WO3. Such selective mining does not constitute a manufacturing process. Unless selective mining is done the tungsten ore cannot be exported or even sold in the country of its origin. Thus the import of selectively mined tungsten ore containing 65% WO3 or more should not be regarded as the import of a product which was been manufactured overseas and has passed through the manufacturing process. The expression "selectively mined" means that the wolfram ore is detached and taken out from the rock in which it is embedded and this is done by crushing the rock and sorting our pieces of wolfram either by hand or by washing or magnetic separation. The appellant produced certificates from well known analytical Consulting and Technical Chemists. According to R. V. Briggs and Co. who claim to have been analysing various ores and minerals including wolframite for over sixty years the ore is always concentrated as part of the mining operations. The normal method is by washing the crushed ore, thereby freeing the mineral from the gangue. The certificate from Derby and Co. London has already been referred to. Along with the appellants statement of the case an extract from the Brussels Tariff nomenclature has been attached as annexure A. In Chapter XXVI with the heading Metallic Ore etc. para 26.01 deals with Metallic Ores and concentrates....The relevant and material portions from these extracts may be reproduced :"Ores are seldom marketed before "preparation" for subsequent metallurgical operations. The most important preparatory process are those aimed at concentrating the ores.For the purposes of the present hearing, the term "concentrates" applies to ores which have had part or all of the foreign matter removed by special treatments, either because such foreign matter hamper subsequent metallurgical operations or with a view to economical transport.Process to which products, physico-chemical or chemical operations provided that they are normal to the preparation of the ores for the extraction of metal. With the exception of changes resulting from calcination, roasting or firing (with or without agglomeration), such operations must not alter the chemical composition of the basic compound which furnishes the desired metal.The physical or physico-chemical operations include crushing, grinding magnetic separation, gravimetric separation, flotation, screening, grading, agglomeration of powers (e.g., by sintering or pelleting) into grains, balls or briquettes (whether or not with the addition of small quantities of binders), drying, calcination, roasting to oxidise or magnetise the ore, etc. (but not roasting for purposes of sulphating, chloridating, etc.)The chemical processes are aimed at eliminating the unwanted matter (e.g. dissolution)."5. Among the ores specifically mentioned to which the above statement applies is Tungsten "or Wolfram". .As against this the only evidence put in by the revenue consisted of the test report of the Deputy Chief Chemist (Annexure E). After giving the necessary particulars it was stated by him that the samples were not ore as mined.We are wholly unable to comprehend how in order to fall under item 26 the ore has to be mined. There is a good deal of force in the argument of Mr. Setalvad for the appellant that the normally acceptable merchantable quality of wolfram or tungsten contains a minimum 65% WO3. This is the usable ore and it is in that sense that it is commercially understood. Wolfram ore when mined contains only 5 to 2 per cent WO3 and in order to make it usable and merchantable ore with minimum 65% WO3, concentration is necessary. If items 26, of the Import Tariff is to be restricted to wolfram being material being material containing 5 to 2 per cent WO3 it would be mainly rock which can neither be imported in large quantity and which will have no market. The separating of wolfram ore from the rock to make it usable ore is a process of selective mining. It is not a manufacturing process. The important test is that the chemical structure of the ore should remain the same. Whether the ore imported is in powder or granule form is wholly immaterial. What has to be seen is what is meant in international trade and in the market by wolfram ore containing 60% or moreWO3. On that there is a preponderating weight of authority both of experts and books and of writings on the subject which show that wolfram ore when detached and taken out from the rock in which it is embedded either by curshing the rock and sorting out pieces of wolfram or by washing or magnetic separation and other similar and necessary process it becomes a concentrate but does not cease to be ore. Unless the ore is roasted or treated with any chemical it cannot be classed as processed.6. It is common ground that the wolfram ore which was imported by the appellants was never subjected to any process of roasting or treatment with chemicals to remove the impurities. It thus remained wolfram ore concentrate containing 65% WO3 which was of the merchantable quality and was known commercially as such and imported as ore. Apart from all this it must be remembered that in interpreting items in Taxing Statutes resort should be had not to the scientific or technical meaning but to the meaning attached to them by those dealing in them in their commercial sense. There can, therefore, be no manner of doubt that the goods imported by the appellants fell within item 26 of the Import Tariff and no duty was leviable on them. The appellants were entitled to the refund of the amounts which were paid by them by way of duty.7

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]We are wholly unable to comprehend how in order to fall under item 26 the ore has to be mined. There is a good deal of force in the argument of Mr. Setalvad for the appellant that the normally acceptable merchantable quality of wolfram or tungsten contains a minimum 65% WO3. This is the usable ore and it is in that sense that it is commercially understood. Wolfram ore when mined contains only 5 to 2 per cent WO3 and in order to make it usable and merchantable ore with minimum 65% WO3, concentration is necessary. If items 26, of the Import Tariff is to be restricted to wolfram being material being material containing 5 to 2 per cent WO3 it would be mainly rock which can neither be imported in large quantity and which will have no market. The separating of wolfram ore from the rock to make it usable ore is a process of selective mining. It is not a manufacturing process. The important test is that the chemical structure of the ore should remain the same. Whether the ore imported is in powder or granule form is wholly immaterial. What has to be seen is what is meant in international trade and in the market by wolfram ore containing 60% or moreWO3. On that there is a preponderating weight of authority both of experts and books and of writings on the subject which show that wolfram ore when detached and taken out from the rock in which it is embedded either by curshing the rock and sorting out pieces of wolfram or by washing or magnetic separation and other similar and necessary process it becomes a concentrate but does not cease to be ore. Unless the ore is roasted or treated with any chemical it cannot be classed as processed.6. It is common ground that the wolfram ore which was imported by the appellants was never subjected to any process of roasting or treatment with chemicals to remove the impurities. It thus remained wolfram ore concentrate containing 65% WO3 which was of the merchantable quality and was known commercially as such and imported as ore. Apart from all this it must be remembered that in interpreting items in Taxing Statutes resort should be had not to the scientific or technical meaning but to the meaning attached to them by those dealing in them in their commercial sense. There can, therefore, be no manner of doubt that the goods imported by the appellants fell within item 26 of the Import Tariff and no duty was leviable on them. The appellants were entitled to the refund of the amounts which were paid by them by way of duty.