Customs, Excise and Gold Tribunal - Delhi
India United Mill No. 6 vs Collector Of Central Excise on 26 July, 1996
Equivalent citations: 1996(88)ELT79(TRI-DEL)
ORDER G.R. Sharma, Member (T)
1. By the present appeal, the appellants have contested the decision of the learned Collector (Appeals) holding that benefit of Notification No. 251/82 in respect "controlled shirting" during the period February and March, 1984 was not available to the appellants on the ground that "controlled shirting" did not include the blend of 48% polyester and 52% cotton.
2. The facts of the case, in brief, are that the appellants are engaged in the manufacture of various types of cloth including controlled shirting. The Department alleged that since controlled shirting manufactured by the appellants had a blend of 48% polyester and 52% cotton, therefore, this blend was not entitled to the exemption under Notification No. 251/82, dated 8-11-1982.
3. Shri Dinesh H. Mehta, the learned Advocate appearing for the appellants submits that fabrics have been defined in Clause (vi) of Notification No. 251/82 that will be eligible for concession!. He submits that controlled shirting is specifically included in Para (vi) of the Notification. The learned Counsel submitted that Textile Commissioner in its' Notification No. CER/1/68, dated 2-5-1968 inter alia provided for two factors. In terms of exemption Notification No. 1, the two factors are : (i) the maximum ex-factory price and (ii) the maximum retail price. In Para (ii) of the Notification, the Textile Commissioner defined various items including controlled shirting. While defining controlled shirting under para 2(d) of this Notification, the Textile Commissioner provided as under:
"controlled shirting" means any type of cloth of plain or twill weave whether or not mercerised or pre-shrunk manufactured from single yarn, not being fancy yarn which is manufactured either wholly from cotton or partly from cotton and partly from any other material and containing not less than 75% of cotton by weight." The learned Counsel submitted that this definition of "controlled shirting" was amended by Notification No. CER/1/84/3, dated 24th April, 1984. He submitted that this amending Notification amended the original No. CER/1/68, dated 2nd May, 1968 in respect of two things : one, notwithstanding anything contained in items (i) to (viii), in respect of controlled shirting as defined in sub-para (d-2) of Para 2 produced by a producer under the control of the National Textile Corporation (hereinafter called NTC) having a spinning plant and packed on or after the 14th November, 1983; and two, in Para 2 of this amending Notification, it has been further provided that in Paragraph 2 of Notification No. CER/1/68, dated 2nd May, 1968, the existing sub-para (d) shall be renumbered as (d-2) and after sub-para (d-1) so renumbered the word "or" shall be added and thereafter the following shall be inserted as sub-para (d-2).
"(d-2) 'controlled shirting' means any type of cloth of plain or twill weave manufactured from single yarn which :- (i) is manufactured with blend percentage of 52% cotton and 48% polyester by weight."
The learned Counsel submitted that by this amending notification both Para- "4 graph 1 as well as Paragraph 2 have been amended. Para 1 has been amended inasmuch as an item as "(ix)" has been added and Para 2 of that Notification has been amended that controlled shirting shall include fabric with blend percentage of 52% cotton and 48% polyester by weight. The ld. Counsel submitted that there is no dispute about blend of the yarn or fabric used in the manufacture of controlled shirting. He submitted that sines this Notification has been made effective retrospectively w.e.f. 14th November, 1983 and therefore, their case was fully covered by the amending notification. He therefore, prayed that the appeal may be allowed.
4. Shri J.M. Sharma, the learned DR submitted that exemption Notification No. 251/82 talks of controlled shirting; that controlled shirting has been defined in sub-para (vi) of the Notification. Referring to the Notification No. CER/1/68, dated 2nd May, 1968, the learned DR submitted that controlled shirting means any type of cloth containing not less than 75% of cotton by weight and therefore, the learned DR submitted that the controlled shirting manufactured by the appellants contained less than 75% of cotton and therefor, it was not eligible to the exemption under Notification No. 251/82. In so far as amending Notification No. CER/1/84/3, dated 25th April, 1984 is concerned, the ld. DR submitted that this Notification was issued on 25th April, 1984 and since the period of dispute is between February and March, 1984 therefore, this Notification cannot have retrospective effect inasmuch as of the Central Excise Notifications are effective prospectively. The ld. DR therefore, prayed that the impugned order may be upheld.
5. Heard the submissions of both sides. The admitted position in this case is that the controlled shirting manufactured by the appellants during the period February and March, 1984 had a blend of 48% polyester and 52% cotton There is no dispute that controlled shirting was not eligible to the benefit of Notification No. 251/82. The limited dispute in this case is whether the blend of 48% polyester and 52% cotton used in the controlled shirting was eligible to the benefit of exemption under Notification No. 251/82. We find that Central Excise Notification referred to above inter alia provided that fabrics which answered the description of "controlled dhoti," "controlled saree," "controlled long-cloth", "controlled shirting" or "controlled drill" as defined from time to time by the Textile Commissioner under Textiles (Control) Order, 1948 and for which maximum ex-factory pricas have been specified by the Textile Commissioner under the said order shall be exempt from the whole of duty of excise leviable thereon under the said Act subject to the condition that such fabrics are not supplied by the factory in which shirts are manufactured or processed to an industrial concern. From this provision and in the Notification, we find that two things were left to the Textile Commissioner - number one was what will constitute "controlled shirting" and the second point was what should be the maximum ex-factory price and maximum retail price. In pursuance of the provision of this Notification, the Textile Commissioner issued a Notification No. CER/1 /68, dated 2nd May, 1968 inter alia provided that controlled shirting means any type of cloth of plain or twill weave containing not less than 75% of cotton by weight. This Notification was further amended by Notification No. CER/1/84/3, dated 25th April, 1984 amending the definition of the controlled shirting to the extent that the blend percentage of 52% cotton and 48% polyester by weight shall be included in the definition of the controlled shirting. We find that this Notification, though issued on 25th April, 1984, yet it has been made effective from 14-11-1983. One point that was agitated by the learned DR was that Central Excise Notifications are effective only prospectively. We find that this amending notification has been made retrospectively effective, that is from 14 November, 1983, in respect of the amendment indicated therein. Amendment is in respect of 'cost' as well as in respect of the definition. We find that the part dealing with 'cost' and the part dealing with 'definition' are two different and separate items specified in the said Central Excise Notification. Retrospective effect has been given only to the part dealing with 'cost' and not to the other part. We therefore, find that insofar as the blend of the cloth known as "controlled shirting" is concerned, the amending notification will be effective only from 25th April, 1984 and not w.e.f. 14th November, 1983.
6. In this view of the matter, the impugned order is upheld and the appeal is rejected.