JUDGMENT The judgment of the Court was as follows :- Petitioner carries on business of manufacturing "Engineers, Steel Files" at its factory situated at 29, New Tangra Road, Cakutta. The said Steel Files are manufactured from alloy steel which has to be imported by the petitioner. Since 1954, the petitioner started manufacturing of the said Steel Files and is still importing alloy steel from foreign countries. On or about March 1, 1968, a notification was issued by the Government of India bearing No. 30 Customs, whereby the alloy steel when imported for the manufacture of Small Tools was exempted from the Customs duty leviable thereon which was in excess of 5% advalorem when of British manufacturer and, 15% ad valorem when not of British manufacturer. It was further provided in the said notification that the benefit of the exemption would be granted provided the importer by executing a bond in such form and for such sum as may be specified by the Asstt. Collector of Customs binds himself to pay on demand of such quantity of alloy steel which is not proved to the satisfaction of the Asstt. Collector of Customs to have been used for the aforesaid purpose an amount equal to the difference between the duty leviable on such quantity but for the exemption and that already paid at the time of importation. Petitioner came to know of the said notification for the first time in December 9, 1969. Prior to December 9, 1969 the petitioner paid the Customs duty in respect of the import of the alloy steel in full without claiming the exemption granted under the said notification. From December, 1969 to 4th December, 1971 the petitioner had been claiming and has been granted exemption of duty in terms of the said notification in respect of the import of alloy steel made by it during the said period for the manufacture of the said steel files. During the said period, viz December. 1969 to October, 1971 the petitioner from time to time executed 50 bonds as required by the said notification in respect of the different consignments of alloy steel for the purpose of claiming the exemption of duty. In respect of consignment of alloy steel imported by the petitioner which arrived in November, 1971, the Customs Authorities refused to grant the benefit of confessional rate of duty in terms of the said notification. In respect of consignment of alloy steel imported by the petitioner which arrived in November, 1971, the Customs Authorities refused to grant the benefit of confessional rate of duty in terms of the said notification. It is contended by the Customs that the petitioner was not entitled to claim exemption from duty in terms of the said notification as the steel files manufactured by the petitioner out of the imported alloy steel were not "small tools" within the meaning of the said notification. In order to avoid detention of the aforesaid consignment and to obtain early clearance of the materials which were urgently needed by it, the petitioner paid the entire customs duty as assessed by the Respondent No.1 under protest. In the meantime the petitioner made various representations to the Respondent No.3 and made applications before the Respondent No.1 for granting refund of duty paid in excess of what could be levied in terms of the said notification. The Respondent No.1 passed three orders rejecting in part one of the said applications for the refund of the Customs duty in respect of the consignments imported during the period December 1971 to February 1972. Against the said orders of the Respondent No.1 the petitioner preferred appeals to the Appellate Collector of Customs and the same are pending. The petitioner's application for refund of duty in respect of the other consignments imported during the period of December, 1971 to February, 1972 have not been disposed of by the Respondent No. 1 and are still pending. On September 2, 1972 the petitioner received a letter from the Respondent No.1, the Asstt. Collector of Customs in reply to its representation dated December 2, 1971 and the subsequent correspondence relating thereto. By the said letter the petitioner was informed that the respondent No.3 had carefully examined in consultation with D.C.T.D. the question as to whether the alloy steel imported for the manufacture of steel files would be entitled to the benefit of concessional rate of duty laid down in the said notification dated March I, 1968 which refers to 'Alloy Steel' for the manufacture of small tools. It was further stated that the Board was advised t hat the term 'small tools' referred to those tools which were used with the machine tools and that the steel files could not be treated as small tools and the petitioner's request for concessional rate of duty could not be acceded to. Thereafter, the petitioner received a letter dated September 12, 1972 from the respondent No. 1 whereby the 'petitioner was required to pay a sum of Rs. 2,80,055/in respect of various bonds mentioned in the enclosure to the said letter. The said letter was sent as a result of the decision of the Respondent No. 3 contained in the said letter dated August 29, 1972. It is stated by the petitioner that the steel files manufactured by it are known in the trade as small tools. Steel files are utilised for the purpose of removing and/or cutting metals. The tools utilised for the purpose of removing and cutting metals are technically as well as in the trade are known as small tools. The said steel files are also affixed to the machine for removing and cutting metals. The petitioner being aggrieved by the said decision as well as the demand made by the Respondent No.1 moved this Court in an application under Article 226 of the Constitution and obtained the present Rule. 2. An affidavit-in-opposition has been filed on behalf of the respondents and affirmed by Barendra Nath Mitra, the Asstt. Collector of Customs, the Respondent No.1. In that affidavit it is stated that the petitioner is manufacturing steel files which are "hand tools" and not 'small tools'. It is stated that the concessional rate of duty hitherto enjoyed by the said petitioner was not arbitrarily withdrawn but the same was legally withdrawn in terms of the Gazette notification, wherein the criterion is 'satisfaction of the Asstt. Collector'. As the Asstt. Collector concerned was satisfied in the instant case that the steel files which are produced were not small tools but band tools, extension of the benefit under concessional rate was rightly denied. In paragraph 29 of the said affidavit it is stated that the small tools ale tools like first drills and reamers, dis and taps, gear cutters and hacksaw blades as mentioned under item 72(3) of the first schedule of the Indian Customs and Central Excise Tariff. In paragraph 29 of the said affidavit it is stated that the small tools ale tools like first drills and reamers, dis and taps, gear cutters and hacksaw blades as mentioned under item 72(3) of the first schedule of the Indian Customs and Central Excise Tariff. Tools are classified under item 71(a) of ICT and such definition is quite clear and specific. In view of the specified mention in the relevant statute any exraneous meaning as given in any other statutory order or trade usage as ought to be suggested by the petitioner should not be looked into and in any event they can not be admitted. It has, however, been admitted in the affidavit that due to wrong notion a number of bonds were accepted by the Customs House and goods were allowed to clear at lower rates of duty in terms of notification in question. 3. Mr. Chatterjee, appearing on behalf of the petitioner in support of the Rule contended that the steel files manufactured by the petitioner were small tools within the meaning of the said notification dated March 1, 1968. The said steel files are commonly known in the trade as small tools. The Ministry of Foreign Trade, Government of India, in the various import trade policy published from time to time have also treated the said steel files as small tools and has allowed the import on the said basis. In the Monopoly and Restrictive Trade Practices (Classification of Goods) Rules, 1971 the said steel files have also been described under the group small tools. There is no definition of the small tools in the statute. Reference to item 72(3) where certain small tools have been referred are not exhaustive. According to Mr. Chatterjee any artificial definition can not be imported for the purpose of disallowing the exemption of lower rate of import duty which the petitioner is entitled to under the said notification. 4. Mr. Sen. appearing on behalf of the respondents sought to rely upon a letter dated 25th August, 1954 written by the Under Secretary, Customs, to the Collectors of Customs, Calcutta, Bombay and Madras and contended that in terms of the said executive instruction it should be held that the Engineers' file is not a small tool as it has not been included in the list which has been enclosed in the said letter. It is further contended that the said letter in an executive instruction sought to fill up the lacuna in the statute and has been issued under the executive powers conferred under Article 73 of the Constitution. In support of his contentions, Mr. Sen relied upon the decision of the Supreme Court in (1) Ram Jawaya v. State of Punjab, AIR 1955 SC 549 . The said letter of the 25th August, 1974 reads as follows : No. 36(69) Cus. Ill/54 Dated 25.8.1954. To The C. C. Bombay, Calcutta & Madras. Subject :-Small Tools-Exhaustive list of – Please refer to your letter No. C. 2497/54 dated the 26.5.1954. No 708/53 dated the"12.4.1954 ROR AO 1352/54 AS dated the 22.6.1954 on the subject noted above. The board considers that the term "small tools" does not bear any relation to the size of the tools but is meant only to distinguish a sub-group "small tools" from the broad category of tools which include all types of tools such as hand tools, machine tools etc. For the purpose of Tariff classification the term "small tools" should apply to such tools as are worked with machine tools. Machine tools are mechanically contrivances for cutting, forming, abroading, polishing and otherwise working or treating metals, wood, glass or plastics. As such tools for working on coal rock, marble or stone cannot be deemed to fall in the category of "small tools". An illustrative list not exhaustive list of small tools is enclosed for your information and guidance. Sd/-16/6 Copy forwarded to D. S. (CDS) The C. C. Cochin, The CCE, Bombay, Calcutta, Delhi, Madras, Shillong and Baroda. The Ministry of C&I, Their papers are returned. Sd/-16/8/S4 D.S. (CDS). Milling cutters Taps threading Dies threading Tools threading Drills and reamers Band Saws and hack saws (blades) Wood working saws Grinding Tools Single point Cutter Tools Boring Tools (with bits) Hobs Gear Cutters Wire drawing dies Paper cutting knives Press tools Sheering blades Honing Tools Lapping Tools File bands and tools (power operated) Press dies Forgoing dies Stamping dies Heading dies Moulding dies Broaches Wood Working Cutters. 5. In Ram Jawaya's case the Supreme Court held that the functions of the Executive are not confined to the execution of laws made by the Legislature and already in existence. 5. In Ram Jawaya's case the Supreme Court held that the functions of the Executive are not confined to the execution of laws made by the Legislature and already in existence. Articles 73 and 162 indicate that the powers of the Executive of the Union and of a State are co-extensive with the legislative powers of the Union and of the Slate. While the Executive can not act against the provisions of a law, it does not follow that in order to enable the Executive to function relating to a particular subject, there must be a law already in existence, authorising such action. In that case the Supreme Court held that the specific legislation is not required for enabling the State to carryon a trade or business. In my opinion, that decision has got no application to the facts and circumstances of the present case. 6. Article 265 provides that no tax shall be levied or collected except by authority of law. So, not only the levy but also the collection of a tax must be under the authority of some law. It is well settled that where an executive authority has been empowered to collect a tax by invalid law or rules made thereunder, the Court is entitled to interfere. 7. In (2) State of Kerala v. Joseph, AIR 1958 SC 296 , the Supreme Court held that where the statute specified the taxable commodities, the Subordinate Authority has no power to add to the list, and the power conferred by the statute must be strictly construed. 8. The said letter of 25th August, 1954, in my view cannot be construed as an executive instruction or a notification. That letter sought to clarify some of the points raised in the letters referred to therein. Item 72 (3) of the first schedule reads as follows : Component parts of machinery as defined in item nos. 8. The said letter of 25th August, 1954, in my view cannot be construed as an executive instruction or a notification. That letter sought to clarify some of the points raised in the letters referred to therein. Item 72 (3) of the first schedule reads as follows : Component parts of machinery as defined in item nos. 72, 72 (1) and 72 (2) and not otherwise specified, namely, such parts only as are essential for the working of the machine or apparatus and have been given for that purpose some special shape or quality which would not be essential for their use for any other purpose but excluding small tools like twist drills and reamers, dies and taps, gear cutters and hacksaw blades: Provided that articles which do not satisfy this condition shall also be deemed to be component parts of the machine to which they belong if they are essential to its operation and are imported with it in such quantities as may appear to the Collector of Customs to be reasonable. 9. Certain small tools referred to in item 72 (3) even though they can be adopted for working of the machines as component parts of machinery as defined in items 72 (1) and 72 (2), have been excluded from payment of 40% advalorem imports duty. The Customs sought to make out a case in affidavit-in-opposition that only those items mentioned in 72 (3) are small tools and as the steel file has not been mentioned therein, it can not be regarded as small tools. The list of small tools which has been annexed in the letter of the 25th of August, 1954 included many more items than those referred to in item 72 (3). Moreover, no reference has been made either to the letter of 25th August, 1954 or items referred to in item 72 (3) in the order of the Asstl. Collector of Customs and in the decision of the Board of the Central Excise and Customs. So in this state of affairs, in my view, for the purpose of determining whether the steel files are small tools as referred to in the notification. Collector of Customs and in the decision of the Board of the Central Excise and Customs. So in this state of affairs, in my view, for the purpose of determining whether the steel files are small tools as referred to in the notification. no reliance can be placed upon those items if the list annexed to the letter dated 25th August, 1954 and certain items of small tools referred to in item 72 (3) of the Indian Customs and Central Excise Tariff, which are only illustrative but not exhaustive. 10. Reliance was placed by Mr. Chatterjee upon the decision of the Supreme Court in (3) Union of India & Ors. v. The Tata Iron & Steel Co. Ltd., AIR 1975 SC 769 . In that case the question arose whether a product is "skelp" or "strip". During the period from 1962 to February 28, 1965 the Central Excise Authorities described the product of Tata Iron & Steel as "skelp" and assessed it at a lower rate of duty. From February 29, 1964 the Revenue claimed that the aforesaid product be classified as 'strip' since there bad been a levy of higher duty for skelp. The Supreme Court observed that in absence of any clear criterion to determine what is skelp and not strip no useful purpose would be served by even remanding the matter to the Excise authorities for a decision after taking necessary evidence. It is only when a taxing law provides for a clear and unequivocal test for determination as to whether a particular product would fall under strip or skelp it may be possible for the authorities to address itself to the evidence submitted by the parties in order to come to a decision on the basis of the test. This is, however, not possible when there is no identifiable standard. The best way is to define the product for the purpose of excise duty in appropriate terms demarcating clearly the distinction between the two terms. 11. Neither the hand tools nor the small tools have been defined in the statute. The Asstl. This is, however, not possible when there is no identifiable standard. The best way is to define the product for the purpose of excise duty in appropriate terms demarcating clearly the distinction between the two terms. 11. Neither the hand tools nor the small tools have been defined in the statute. The Asstl. Collector of Customs was of opinion that the Engineers' steel files manufactured by the petitioner were 'hand tools', The Central Board of Excise and Customs in its order dated 29th August, 1972 observed: The Board is advised that the term small tools referred to those tools which are used with m1chine tools and that steel files can not be treated as &mall tools. 12. Reliance was placed by the petitioner on Monopolies and Restrictive Trade Practices (Classification of Goods) Rules, 1972. That rules were framed by the Central Government ion exercise of its powers conferred on it by section 27 of Monopolies and Restrictive Trade Practices Act, 1969. Abrasives tools and General Hardware have been grouped in sub-group 343 in major group 34. 341.3 item (c) reads 'small tools like steel files'. In Import Trade Control Policy for the year 1971-72 Volume 2, section II Serial No. A 106 refers to small tools and cutting tools, all types, made of high speed steels, high carbon and alloy steel etc. In Item A106.8 'Engineers' Steel Files' have been mentioned as same against item A 106.1. Accordingly, it is argued that the Engineers' steel files are small tools as referred to in item A 106. A preliminary report of the working group on cutting tools, small tools, hand tools and allied items for the Fifth Plant has been annexed to the affidavit-in-reply wherein paragraph 3.2 reads as follows: Cutting tools cover a very wide range of items and for purpose of conveniences, the cutting tools coming within the purview of the sub-committee are: (1) Broaches (2) Gear Cutting Tools (3) Milling Cutters (4) Reamers (5) Threading Tools (6) Twist Drills (7) Industrial Knives (8) Hack Saw Blades (9) Wood-working and metal working band saw blades (10) Engineers' Steel Files (11) Tungaten Carbide tips Civilian Sector only (12) T.C. Tipper tools It appears that some of these items in this list have been mentioned in the letter of 25th August, 1954. 13 In the (4) Collector of Customs v. Ganga Setty, AIR 1963 SC 1319 , the Customs Authorities classified feed cats as grain. The Supreme Court held that such classification was not perverse and could not be interfered with. 14. In (5) V. V. lyer v. Jasjit Singh, AIR 1973 SC 194 , the Supreme Court observed that where two alternative interpretation are possible and the Customs Authorities adopt a reasonable view relating thereto which is preferable to Revenue, such findings of the Authorities can not be interfered with by the High Court under Article 226 f the Constitution even though another view contrary to one adopted is in favour of the subject. 15. In the instant case the question of alternative interpretation does not arise. In (3) Tata Iron & Steel Co.'s case ( AIR 1975 SC 769 ) the Supreme Court observed that the absence of identifiable standard would naturally give rise to the scope for arbitrary assessment at the hands of different authorities. 16. It appears that different authorities at different times sought to interpret small tools according to their whims without disclosing the reasons or basis for such interpretation. Quite a few number of bonds were previously accepted by the Customs presumably upon the view that steel files manufactured by the petitioner are small tools. Subsequently the Asstt. Collector of Customs changed his mind and disallowed the exemption of the ground that the steel files are not small tools but hand tools. In the order no reason for such determination, has been given. The Central Board of Excise and Customs in its letters dated 29lh August, 1972 also did not state any reason as to why the steel files could not be treated as small tools. That letter disclosed that the Board consulted the D. C. T. D. but the report of such consultation has not been disclosed either to the petitioner or placed before the Court. 17. In (6) Union of India v. M. L. Capoor, AIR 1974 SC 87 , the Supreme Court observed that the reasons are the links between the materials on which certain conclusion are based and the actual conclusions. They disclose how the mind is applied to the subject matter for a decision whether it is purely administrative or quasi-judicial. They should reveal a rational nexus between the facts considered and the conclusion reached. 18. They disclose how the mind is applied to the subject matter for a decision whether it is purely administrative or quasi-judicial. They should reveal a rational nexus between the facts considered and the conclusion reached. 18. In (7) Hochtief Gammon v. State of Orissa, AIR 1975 SC 2226 , the Supreme Court said that the Executive have to reach their decisions by taking into account relevant considerations. They should not refuse to consider relevant matter nor should take into account wholly irrelevant or extraneous consideration. They should not misdirect themselves on a point of Jaw. Only such a decision will be lawful. The courts have power to see that the Executive acts lawfully. It is no answer to the exercise of that power to say that the Executive acted bona fide nor that they have bestowed painstaking consideration. They cannot avoid scrutiny by courts by failing to give reasons. If they give reasons and they are not good reasons, the court can direct them to reconsider the matter in the light of relevant matters, though the propriety, adequacy or satisfactory character of these reasons may not be open to judicial scrutiny. Even if the Executive considers it inexpedient to exercise their powers they should state their reasons and there must be material to show that they have considered all the relevant facts. 19. According to the Central Board of Excise and Customs, small tools are those tools which are used with machine tools. The petitioner has made a specific statement in the petition that steel files can be fitted with machine. If any reason for such decision or determination by the Customs Authorities were disc1mecf, in that case, those reasons might have been scrutinised by the Court to find out whether a reasonable person could come to such a conclusion on the relevant materials available. In the present case there is no material before me to show whether the Customs have considered all relevant materials. 20. In my opinion, they arrived at their decision without considering the relevant materials placed before them, viz. the MRTP (Classification of Goods) Rules, 1971 where steel files have been described as "small tools". In the present case there is no material before me to show whether the Customs have considered all relevant materials. 20. In my opinion, they arrived at their decision without considering the relevant materials placed before them, viz. the MRTP (Classification of Goods) Rules, 1971 where steel files have been described as "small tools". In absence of any definition in the statute either of small tools, hand tools, or machine tools, an identifiable standard or description is to be found and for that purpose, in my view, reliance can be placed upon M.R.T.P (Classification of Goods) Rules, 1971. 21. Accordingly, I hold that the steel files manufactured by the petitioner company are "small tools" and as such they are entitled to the statutory exemption granted under notification dated 1st March, 1968. 22. In the result, this Rule is made absolute. The impugned order of the Under Secretary, Central Board of Excise and Customs dated 29th August, 1972 and the demand notices dated 12-9-72 issued by the Asstt. Collector of Customs are quashed by a writ of Certiorari. 23. Let a Writ of Mandamus be issued against the respondents not to give effect to the impugned notices of demand. There will be no order for costs. The petitioner shall not claim any exemption under the impugned notification for eight weeks.