Customs, Excise and Gold Tribunal - Delhi
Collector Of Central Excise vs Priyadarshini Spg. Mills Ltd. on 30 April, 1990
Equivalent citations: 1990ECR520(TRI.-DELHI), 1990(50)ELT145(TRI-DEL)
ORDER Jyoti Balasundaram, Member (J)
1. The issue for decision in this appeal is the classification of "yarn (including sewing thread) of artificial staple fibre not containing generated synthetic staple waste in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power and supplied in a form other than plain (straight) reel hank."
2. The respondents herein manufacture cotton yarn & man-made yarn of various types. They proposed to manufacture a new type of man-made yarn in February 1987 and therefore filed classification lists, for the yarn made out of a blend of artificial staple fibre & generated synthetic staple waste arid for the yarn made out of a blend of artificial staple fibre & imported synthetic staple waste, claiming classification of the blended yarn under Heading 55.05. However, the Department, after subjecting the yarn to chemical analysis, issued a show cause notice to the assessees on 28-4-1987, for assessment under Heading 55.06 on the ground that the chemical test revealed that the yarn contained synthetic staple fibre.
3. In the order-in-original it is stated that in the reply to the show cause notice, the assessees urged --
a) that the yarn was manufactured out of artificial staple fibre blended with synthetic staple fibre waste, and synthetic staple fibre and synthetic staple fibre waste were not one and the same.
b) that the type of raw material used in the manufacture of particular yarn could not be ascertained by simply analysing the yarn chemically and only a physical inspection/verification of the raw material used for manufacture of yarn could establish its contents; and in support of this contention they quoted the report of the Chemical Examiner, Madras wherein waste fibres were used in the blended yarn ;
c) that the final approval given by the proper officer to the C.Ls No. 76 & 80 of '87 could not be deemed to be provisional merely by issuance of a letter and the C.Ls once approved could not be revised except on finding of new facts and/or due to change of law;
d) that the nature and composition of the final product for the purpose of classification had to be determined in the light of the scheme of the various descriptions recorded in Ch. Heading 55.03 and 55.04.
4. The adjudicating authority held as follows : "There is no dispute about the findings of the Chemical Examiner, Madras. It is not the case of the assessee that the synthetic staple fibre waste does not contain synthetic staple fibres. The authorised representative, Shri S.K. Srivastava, himself admitted that the synthetic staple fibre waste contained certain amount of synthetic staple fibres. The Chemical Examiner, Madras also confirmed that the waste contained synthetic staple fibres to the extent of about 40%. In such a case, when the input itself contains synthetic staple fibres, it is not illogical to conclude that the end product, the yarn invariably does contain synthetic staple fibre. The assessee placed much stress on the raw material which, in fact, is not relevant for the purpose of classifying yarn in question. What is required for the classification of the yarn in question is the yarn itself and its composition. Further neither the Chapter notes nor the Chapter heading speak of the composition or the nature of the inputs that are to be used in the manufacture of the end product e.g. yarn. The Chemical Examiner, Madras never stated that it was not possible for him to determine by chemical analysis whether or not the synthetic waste or the said yarn contained synthetic staple fibres". She accordingly classified the yarn as follows :--
55.06 Yarn, including sewing thread, of artificial staple fibre containing synthetic staple fibres: in relation to the manufacture of which any process is ordinarily carried on with the aid of power ;
5506.21 containing artificial staple fibre and polyester staple fibre (not containing any other textile material) and in which the proportion of polyester staple fibre is more than 40% by weight of the total fibre content.
5506.29 Other.
5. The Collector (Appeals) reversed the order of the Asst. Collector & classified the yarn under Heading 55.05, holding that "what should be contained for purpose of classification of the yarn under Tariff Heading 55.06 is synthetic staple fibre. Mere containing of synthetic fibre in the form of waste which is not known as staple fibre will not attract Tariff Heading 55.06, because the words 'staple fibre' appearing after the words 'synthetic' cannot be ignored. If it is a waste fibre or non-stable fibre, as argued by the appellant, of synthetic origin, the use of the same will not take out the yarn of Tariff Heading 55.05, and bring it under Tariff Heading 55.06. Synthetic fibre may be used as obtained from waste fibre, and it cannot be said that synthetic staple fibre has been used under 55.05, because the fibres themselves are classifiable differently. Synthetic staple fibres are being classified under 55.01, whereas waste of synthetic staple fibres are being classified under 55.03. In the absence of evidence that the impugned yarn has been manufactured by utilising synthetic staple fibre, falling under 55.01, the same cannot be classifiable under 55.06. It has necessarily to be classified under 55.05. There is nothing contrary to the above view in the test report of the Chemical Examiner." The Department has preferred the above appeal against this order dated 25-4-1989.
6. We have heard Shri L.C. Chakravarti, learned DR for the appellants and Shri S.Ravi, learned advocate for the respondents.
7. According to the learned DR, the goods fall under Note 2D (I) and 2D(II) to Section XI of the Central Excise Tariff 1985 as they contain both polyester (i.e. synthetic fibre) & viscose (i.e. artificial fibre). He takes us through the test reports of yarn (Annexure B) showing that the samples are double ply spun yarn composed mainly of synthetic fibre of non-cellulosic origin (Polyester) & artificial staple fibre of cellulosic origin (viscose), & contends that the presence of synthetic staple fibre in the yarn would automatically take it out of the purview of Heading 55.05 and within the scope of Heading 55.06. He submits that the presence of waste in the yarn (as indicated in the test reports) is immaterial. With reference to the test report of raw material (Annexure A) the DR contends that a majority of the reports reveal a content of man-made synthetic staple fibre of non-cellulosic origin, though the reports on a few samples contain a note on waste. Regarding the reports containing a note on waste, he submits that these samples contain synthetic staple fibre in the form of waste, and the presence of synthetic staple fibre in any form would exclude the material from classification under Heading 55.05, more so when the scheme of the Tariff recognises that synthetic staple fibre can exist in the form of waste. In this connection, he invites our attention to Heading 5504.13 "Yarn (including sewing thread) of synthetic staple fibres. Yarn in which acrylic or modacrylic staple fibre predominates by weight. Yarn containing other synthetic staple fibre in the form of waste or in the form of fibre produced out of such wastes". With reference to those test reports wherein the samples have been found to contain "cut ends" or "knots" or found "entangled", Shri Chakravarti submits that these samples also contain synthetic staple fibre in the form of waste, thus ruling out classification under Heading 55.05. He urges us to read the entire test report as a harmonious whole and to uphold classification of the yarn under Heading 55.06.
8. In reply, the learned counsel submits that the entire dispute has arisen as a result of misinterpretation and wrong understanding of the meaning of the word "staple" on the part of the Chemical Examiner. The word "staple" has a definite connotation in textile industry & is governed by the twin factors of denier & length. The learned advocate points out the mention of denier & length in purchase bills of polyester staple fibre, & absence of such indication in the bills relating to purchase of polyester cutter waste and polyester drawn waste. He refers to the definition of "staple" & "staple fibre" in several textile encyclopedias and text books on textiles, to emphasise that the word "staple" has a definite meaning in textile parlance. He submits that the test reports refer to staple fibres of varying lengths and that the moment there is a variation in length, the fibre can no longer be a 'staple' fibre so as to bring the yarn within the fold of Heading 55.06.
9. We have heard both sides, carefully considered the submissions & perused the records. The details of test reports of yarn samples are found in Annexure B to the Collector's authorisation. The samples have been described as non-cellulosic synthetic waste/viscose yarn and MM fibre yarn. The purpose of drawal of samples is to test the percentage of synthetic waste & viscose staple fibre, the percentage of non-synthetic waste & viscose.
The findings of the C.E. are as given below :-
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Description of Purpose for Findings of the Chemical Examiner (Extract) samples drawn which drawn
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1. Non-cellulosic To be tested for The sample is a double ply spun yarn com-
synthetic percentage of posed of artificial fibres (Viscose) and syn waste/viscose synthetic waste thetic fibres (Polyester). The synthetic fibre yarn and viscose content is 13.7% by weight of the total fibre staple fibre content. P1. see note below:
NOTE : It is not possible by test to find out whether the waste fibres have been used in the blended yarn. This may be verified by execu-
tive checks.
2. M.M. Fibre To find out per- The sample is double ply yarn composed of yarn centage of syn- artificial staple fibre (Viscose) and synthetic thetic waste and staple fibres (Polyester). The synthetic fibre viscose staple content is 13.7% by weight of the total fibre fibre. content.
3. M.M. Fibre To find out per- The sample is double ply spun yarn composed yarn centage of non- of synthetic staple fibres of cellulosic and non-
synthetic waste cellulosic origins. The non-cellulosic fibre
and viscose content is 40.1%.
4. Non-Cellulosic To find out the The sample is a double ply spun yarn com
synthetic %age of non- posed mainly of synthetic fibres of non-cel
waste/Viscose cellulosic syn- lulosic origin (Polyester) and artificial staple
yarn thetic waste and fibres of cellulosic origin (Viscose)
viscose Percentage of Synthetic staple fibres of non
cellulosic origin in the total fibre content of
the sample by weight is 33.9%. Please see
Note given below :-
NOTE: It is not possible to state whether the
waste fibres have been used in the blended
yarn. This may be verified by executive
checks.
5. Non-cellulosic To find out the Sample is a double ply spun yarn composed
synthetic %age of non- mainly of synthetic staple fibres of non-cel
waste/Viscose cellulosic syn- lulosic origin (Polyester) and artificial staple
yarn thetic waste and fibres of cellulosic origin (Viscose).
viscose. Percentage of synthetic staple fibre of non
cellulosic origin on the total fibre content of
the sample by weight is 32.2. Please see Note
given below :-
NOTE : It is not possible to state whether the
waste fibres have been used in the blended
yarn. This may be verified by executive check.
6. Non-cellulosic To find out the The sample is a double ply spun yarn com-
synthetic %age of non- posed of man-made synthetic staple fibres of
waste/Viscose cellulosic non-cellulosic origin (Polyester) and man-
yarn synthetic made artificial staple fibres of cellulosic
waste/Viscose. origin (Viscose).
The percentage of non-cellulosic fibre con-
tent by weight on the total fibre content in the
sample is 39.2.
7. -do- -do- The sample is a double ply spun yarn com-
posed of man-made synthetic staple fibres of
non-cellulosic origin (Polyester) and man-
made artificial staple fibres of cellulosic
origin (Viscose).
The %age of non-cellulosic fibre content by
weight on the total fibre content in the sample
is 12.8.
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10. Annexure A contains details of test reports of samples of the raw material used in manufacture of the yarn, which are as follows :-
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Description of Purpose for Findings of the Chemical Examiner (Extract)
samples drawn which drawn
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1. Non-cellulosic To be tested for The sample is in the form of light blue colour synthetic waste %age of non- tinted fibrous mass. It is composed of man cellulosic syn- made synthetic staple fibre of non-cellulosic thetic waste origin (Polyester) and man-made artificial staple fibres of cellulosic origin (Viscose).
%age of composition of the fibre is as below:
Percentage of Polyester fibre: 32.2 by weight.
Percentage of Viscose fibre : 67.8 by weight.
Fibre waste (Soft-waste) has been described under Chapter 55.05 of the Explanatory Note to harmonised commodity description and coding system. Fibre waste (soft-waste) as relatively long fibres obtained as waste during the formation and processing of filaments :
short-fibres obtained as waste from the card-
ing, combing and other processing preparatory to the spinning of staple fibres (e.g. noils, small-broken pieces of laps, slivers and rovings).
The sample under reference is found to have the characteristics of waste mentioned in the Explanatory Notes such as short fibres ob-
tained as waste from carding, combing and other processes of spinning fibres. However, it may be ascertained by the executives as to at which stage the material under reference is obtained as waste.
2. Non-cellulosic To be tested for The sample is in the form of light blue synthetic waste %age of Non- coloured tinted fibrous mass. It is composed cellulosic syn- of man-made synthetic staple fibres of non-
thetic waste cellulosic origin (Polyester) and man-made
artificial staple fibres of cellulosic origin.
Percentage composition of fibres;
%age of polyester fibres : 33.8
%age of viscose fibres : 66.2
Please see note attached.
NOTE : Fibre waste (soft-waste) has been
described under Chapter notes to Chapter
55.05 in the Explanatory Notes to the Har-
monised commodity description and coding
system as follows :--
"...relatively long fibres obtained as
waste during the formation and processing of
filaments, short fibres obtained as waste from
the carding, combing and other processes
preparatory to the spinning of staple fibres
(eg. noils, small broken pieces of laps, slivers
or rovings)
The samples under reference have the
characteristics of waste mentioned above only
with respect to length of fibres.
3. 100% Non-Cel- -do- The sample is in the form of white assembled
lulosic synthetic mass composed mainly of small, thin and thick
waste tufts of white staple fibres with cut-ends,
laid parallel of lengths varying from 4 to 4.5
cms. It is wholly composed of non-cellulosic
fibres (Polyester). It also has a very small
quantity of entangled tuft of shinning fibres of
cellulosic origin (Viscose). These tufts have
some entangled knots and a few of them have
dirt and foreign bodies adhering on them in
traces. Percentage of polyester received: 97.0
Percentage of Viscose as received : 3.0
Please See note below :
NOTE.: Fibre waste (soft-waste) has been
described under chapter notes to Chapter
55.05 in the Explanatory Notes to the Har-
monised commodity description and coding
system as follows :--
"...relatively long fibres obtained as
waste during the formation and processing of
filaments, short fibres obtained as waste from
the carding (eg. noils, small broken pieces of
laps, slivers, or rovings).
The samples under reference have the
characteristics of waste mentioned above only
with respect to length of fibres.
4. Synthetic waste To be tested for The sample is in the form of pale blue
%age of non- coloured tinted entangled fibrous mass. It is
cellulosic syn- composed of man-made synthetic staple
thetic waste fibres of non-cellulosic origin (Polyester) and
man-made artificial staple fibres of cellulosic
origin (Viscose).
Percentage of polyester fibres : 31.1%
Percentage of Viscose fibres : 68.9%
Please see Note below:
Note: The sample is found to be of entangled short fibres with lumpy knots at several places.
Fibre waste (soft waste) has been described under chap-
ter notes to Chapter 55.05 in the Explanatory Notes to the Har-
monised Commodity description and coding system as follows :--
"...relatively long fibres obtained as waste during the forma-
tion and processing of filaments, short fibres obtained as waste from the carding, combing and other processes preparatory to the spinning staple fibres (e.g. noils, small broken pieces of laps, slivers or rovings) The sample under reference has the characteristics of waste mentioned above.
5. Synthetic waste To be tested for The sample is in the form of light blue tinted percentage of fibrous mass. It is composed of man-made synthetic waste synthetic staple fibres of non-cellulosic origin (Polyester) and man-made artificial staple fibres of cellulosic origin (Viscose).
Percentage of polyester fibre : 31.0 Percentage of Viscose fibre : 69.0
6. 100% Non-cel- To be tested for The sample is in the form of white assembled lulosic synthetic percentage of mass composed mainly of small, thin and waste synthetic waste thick tufts of white staple fibres with cut ends, laid parallel, of varying lengths, It is com-
posed wholly of non-cellulosic fibres (Polyester). These tufts have some entangled knots and a few of them have dirt and foreign bodies adhering on, in traces.
7. 100% Non-cel- To be tested for The sample is in the form of white assembled lulosic synthetic %age of non- mass composed mainly of small and thick tufts waste cellulosic syn- of white staple fibres with cut ends. Few of thetic waste. these fibres have knots foreign bodies and dirt bundles of fibres is of different length. It is composed wholly of non-cellulosic fibres (Polyester). In view of the above it may be considered to have got the general charac-
teristics of waste.
8. Synthetic waste To be tested for The sample is in the form of light blue tinted %age of non- fibrous mass. It is composed of man-made cellulosic syn- synthetic staple fibres of non-cellulosic origin thetic waste (Polyester) and man-made artificial staple fibres of cellulosic origin (Viscose).
%age of polyester fibre-59.2 by weight.
Please see Note below: --
Fibre waste (soft-waste) has been des-
cribed under Chapter notes to Chapter 55.05 in the Explanatory Notes to the Harmonised Commodity description and coding system.
The sample under reference has the charac-
teristics of waste mentioned in the HSN only with respect to length of fibre.
9. Synthetic waste To be tested for The sample is in the form of white fibrous %age of syn- mass. It is composed of artificial staple fibres thetic waste of cellulosic origin (Viscose) and synthetic staple fibres of non-cellulosic origin (Polyester).
%age of polyester fibres : 56.7 %age of Viscose fibres : 43.3.
10. 100% Non-Cel- To be tested for The sample is in the form of assembled mass lulosic synthetic %age of non- composed mainly of small, thin and thick tufts waste cellulosic syn- of white staple fibres with cut ends laid paral-
thetic waste. lel of varying lengths. It is composed wholly of
non-cellulosic fibre (Polyester). These tufts
have some entangled knots and a few of them
have dirt and foreign bodies adhering on in
traces.
11. 100% Non-cel- To be tested for The sample is in the form of white assembled
lulosic synthetic %age of non- mass, composed mainly of small, thin and
waste cellulosic syn- thick tufts of white staple fibres with cut ends,
thetic waste. laid parallel, of varying lengths. It is com-
posed wholly of non-cellulosic fibres
(Polyester). These tufts have some entangled
knots and a few of them have dirt and foreign
bodies adhering on, in traces.
12. Synthetic waste -do- The sample is in the form of white fibrous
mass. It is composed of artificial staple fibres
of cellulosic origin (Viscose) and synthetic
staple fibres of non-cellulosic origin
(Polyester).
%age of polyester fibres : 29.2
%age of Viscose fibres : 70.8
13. 100% Non-cel- -do- The sample is in the form of white assembled
lulosic synthetic mass composed of small, thin and thick
waste tufts of whit staple fibres with cut ends
laid parallel of varying lengths. It is com-
posed wholly of synthetic staple fibres of non
cellulosic origin (Polyester). These tufts have
entangled knots and few of them have dirt and
foreign bodies adhering on in traces.
14. Synthetic waste To be tested for The sample is in the form of light violet tinted
%age of syn- fibrous mass. It is composed of artificial
thetic waste staple fibres of cellulosic origin (Viscose) and
synthetic staple fibres of non-cellulosic origin
(Polyester). Percentage composition being
Polyester fibre : 53.0%
Viscose fibre : 47.0%
15. Synthetic waste To be tested for The sample is in the form of blue fibrous mass
%age of Syn- having some knots here and there. It is com-
thetic waste posed of artificial staple fibres of cellulosic
origin (Viscose) and synthetic staple fibres of
non-cellulosic origin (Polyester).
%age of polyester fibre : 31.6
%age of Viscose fibre : 68.4
16. -do- To be tested for The sample is in the form of light green tinted
%age of syn- fibrous mass. It is composed of artificial
thetic waste staple fibres of cellulosic origin (Viscose) and
synthetic staple fibres of non-cellulosic origin
(Polyester). Percentage composition being
Polyester fibres: 55.5%
Viscose fibres : 44.5%
17. 100% Non-cel- To be tested for The sample is in the form of white assembled
lulosic synthetic %age of non- mass composed of small, thin and thick tufts
waste cellulosic syn- of white staple fibres with cut-ends laid paral-
thetic waste lel of varying lengths. It is composed wholly of
synthetic staple fibres of non-cellulosic origin
(Polyester). These tufts have entangled knots
and a few of them have dirt and foreign bodies
adhering on in traces.
18. -do- -do- The sample is in the form of white assembled
mass composed mainly of small, thin and
thick tufts of white staple fibres with cut-ends
laid parallel of varying lengths. It is composed
wholly of non-cellulosic fibres (Polyester).
These tufts have some entangled knots and
few of them have dirt and foreign bodies ad-
hering on in traces.
19. -do- -do- The sample is in the form of white assembled
mass composed mainly of small, thin and
thick tufts of white staple fibres with cut-ends,
laid parallel of length varying from 3.5 - to 4.5
cm. It is wholly composed of non-cellulosic
fibres (Polyester). These tufts have some en-
tangled knots and a few of them have dirt and
foreign bodies adhering to them in traces.
20. Synthetic waste To be tested for The sample is in the form of light blue colour-
%age of syn- ed tinted fibre mass. It is composed of man-
thetic waste made synthetic staple fibres of non-cellulosic
origin (Polyester) and man-made artificial
staple fibres of cellulosic origin (Viscose).
The %age of composition of fibres as below:
%age of Polyester fibres : 29.6
%age of Viscose fibres : 70.4
21. 100% non-cel- To be tested for Each of the two samples is in the form of white
lulosic synthetic %age of non- assembled mass composed of small, thin and
waste cellulosic syn- thick tufts of white staple fibres with cut ends,
thetic waste laid parallel, of varying lengths. Each is com-
posed wholly of synthetic staple fibres of non
cellulosic origin (Polyester). These tufts have
entangled knots and few of them have dirt and
foreign bodies adhering on in traces.
22. Synthetic waste To be tested for Each of the two samples is the form of light
percentage of brown tinted fibrous mass. Each is composed
Synthetic waste of artificial staple fibres of cellulosic origin
(Viscose) and synthetic staple fibres of non-
cellulosic origin (Polyester).
The percentage composition being
Sample T.M. Sample T.M.
8/88 9/88
23. -do- To find out the Polyester
%age of Syn- fibres 43.4% 44.0%
thetic waste Viscose
fibres 56.6% 56.0%
24. Non-cellulosic -do- Each of the two samples is in the form of white
synthetic waste assembled mass composed of small, thin &
(100%) thick tufts of white staple fibres with cut ends,
laid parallel, of varying lengths. Each is com-
posed wholly of synthetic staple fibres of non
cellulosic origin (Polyester). These tufts have
entangled knots and a few of them have dirt
and foreign bodies adhering on in traces.
25. Non-cellulosic To find out the The sample is in the form of white assembled
synthetic waste %age of non- mass composed of small, thin and thick tufts
(100%) cellulosic syn- of white staple fibres with cut ends, laid paral-
thetic waste lel of varying lengths. It is composed wholly of
synthetic staple fibres of non-cellulosic origin
(Polyester). These tufts have entangled knots
and a few of them have dirt and foreign bodies
adhering on in traces.
26. Synthetic waste To find out the The sample is in the form of grey coloured
%age of Syn- fibrous mass. It is composed of artificial sta-
thetic waste ple fibres of cellulosic origin (Viscose) and
synthetic staple fibres of non-cellulosic origin
(Polyester).
The percentage composition being
Sample T.M. 12/88
Polyester fibres : 41.5%
Viscose fibres : 58.5%
27. 100% non-cel- To find out the The sample is in the form of white assembled
lulosic synthetic %age of non- mass composed of small, thin and thick tufts
waste cellulosic syn- of white staple fibres with cut ends, laid paral-
thetic waste lel, of varying lengths. It is composed wholly
of synthetic staple fibres of non-cellulosic
origin (Polyester). These tufts have entangled
knots and a few of them have dirt and foreign
bodies adhering on in traces.
28. Synthetic waste To find out The sample is in the form of a light violet
%age of tinted fibrous mass. It is composed of artifi-
polyester waste cial staple fibres of cellulosic origin (Viscose)
and viscose and synthetic staple fibres of non-cellulosic
waste origin (Polyester). The percentage composi-
tion being
Polyester fibres - 41.1%
Viscose fibres - 58.9%
29. -do- -do- Sample is a greyish white fibrous mass having
knots and slubs. It is composed of man-made
staple fibre of non-cellulosic origin
(Polyester) and man-made artificial staple
fibre of cellulosic origin (Viscose)
The non-cellulosic fibre content is 62.2% by
weight.
30. 100% Non-cel- To find out the Sample is in the form of white assembled mass
lulosic synthetic %age of non- composed of thin and thick tufts parallely laid
waste cellulosic syn- white staple fibres with cut ends having vary-
thetic waste ing lengths and with knots in between cel-
lulosic origin (Polyester).
31. 100% Non-cel- To find out the The sample is in the form of white assembled
lulosic synthetic %age of non- mass composed of small, thin and thick tufts
waste cellulosic syn- of parallely laid white staple fibres with cut
thetic waste ends having varying lengths and knots in bet-
ween. It is composed wholly of synthetic sta-
ple fibres of non-cellulosic origin (Polyester).
32. Synthetic waste To find out the The sample is in the form of light green tinted
%age of syn- fibrous mass. It is composed of artificial sta-
thetic waste ple fibres of cellulosic origin (Viscose) and
synthetic staple fibres of non-cellulosic origin
(Polyester).
Percentage of polyester - 31.9
Percentage of Viscose - 68.1
33. 100% Non- cel- To find out the The sample is in the form of white assembled
lulosic synthetic %age of non- mass composed of small, thin and thick tufts
waste cellulosic syn- of parallely laid white staple fibres with cut
thetic waste ends having varying lengths and knots in be-
tween. It is composed wholly of synthetic
staple fibres of non-cellulosic origin
(Polyester).
34. Synthetic waste to find out the The sample is in the form of brown tinted
%age of fibrous mass. It is composed of artificial
polyester waste staple fibres of cellulosic origin (Viscose) and
and Viscose synthetic staple fibres of non-cellulosic origin
waste (Polyester).
Percentage polyester - 45.0
Percentage Viscose - 55.0
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11. In Annexure B we find that there is a note in 3 out of 7 samples (Nos. 1, 4 & 5) stating that it is not possible by test to find out whether waste fibres have been used in blended yarn. Sample No. 1 is a double ply spun yarn composed of artificial fibres & synthetic fibres (not synthetic staple fibre), sample No. 3 consists mainly of synthetic fibres of non-cellulosic origin (not synthetic staple fibre) & artificial staple fibre while in sample No. 5, the words 'Synthetic staple fibres' have been used.
12. In Annexure A, Samples 1, 2, 3, 4, 7, 8 are found to have the characteristics of waste and as against samples No. 3 & 8 the finding is that the characteristics of waste is with respect to length of fibre, which itself indicates that the length of fibre is relevant for determination whether it is staple or waste. In these cases the purpose was to determine the percentage of non-cellulosic synthetic waste. Samples 6, 10, 11, 13, 17, 18, 19, 21, 24, 25, 27, 30, 31, & 33 are of varying lengths (in sample No. 3 the length varies from 4 to 4.5 cm and in sample No. 19 the length varies from 3.5 to 4 cm ) & some have entangled knots, slubs, dirt and foreign bodies in traces and cut ends. Regarding the remaining samples which do not have the characteristics of waste, nothing turns on them because, in these cases, the Chemical Examiner was only determining the percentage (composition) of synthetic waste.
13 A wealth of technical literature has been placed before us on what is meant by "staple" & "staple fibre". At P/409 of Bernard Corbman's "Textiles-fiber to fabrics" (5th Edition) it is mentioned that 'staple is produced in a wide range of deniers and lengths according to the desired end uses. 'Modern Textiles' by Dorothy Lyle (at page 26) defines staple fibres, natural or man-made as "short lengths measured in inches or a fraction of an inch". In KirkOthmer's Encyclopedia of Chemical Technology 3rd edition Volume 16 Staple fibres find a mention at pages 106 & 107 as of relatively uniform length. "Staple" is defined at page 29 of the Encyclopedia of Textiles by the Editors of American Fabrics & Fashions Magazine (3rd edition) as "fibre in short, controlled lengths cut from continuous filament. Yarns spun from it are known as staple yarns". The Dictionary of Textile Terms (at page 587) defines "Staple" as "from Anglo-Saxon, meaning fixed, not variable" and staple fibre as "filaments of the Cellulosic or man-made groups of fibres which have been cut to the length of the various natural fibers". Marjory L. Joseph's "Essentials of Textiles" at page 31 says that "man-made staple fibers are short fibers cut to the length required for the processing equipment and they are cut from filaments extruded in large bundles called tow." R.W. Moncrieff 's "Man-made fibres mentions that "chopped up fibre to be called staple fibre & staple fibres are very short nearly always just a few inches and same in length in a bale". Heading 55.03 at page 760 & 761 of the Explanatory Notes to the Harmonized Commodity Description & Coding System which covers "Synthetic staple fibres, not carded, combed or otherwise processed for spinning" set out that 'synthetic staple fibres are generally of uniform length which distinguishes them from the waste material of Heading 55.05.
14. The note on waste in the H.S.N. is with reference to length of the fibre and length of the fibre is nowhere mentioned in the test reports of samples not containing either the characteristic of waste or containing varying lengths. The lack of homogenity indicates that the fibres are waste. At this juncture it would be pertinent to note that there is no allegation that waste has not been used in the blended yarn and in fact the show cause notice itself mentions that the goods in question contained imported and generated synthetic waste.
15. As per the definition of "staple fibre "as quoted in paragraph-13, a staple fibre is a fibre of uniform length and denier. Test reports of the samples mentioned at Srl. No. 6, 10, 11, 13, 17, 18, 19, 21, 24, 25, 27, 30, 31 and 32 of Annexure 'A' enclosed to the Collector's authorisation clearly state that the fibres in the samples were of varying lengths. Paragraph 2 (9) of the Order No. 9/89 (HQ ROA No. 217/89) dated 24-7-1989 passed by the Collector of Central Excise, Hyderabad under Section 35B (2) of the Central Excises & Salt Act says that:
"On physical examination of the samples of synthetic waste, it is seen that it is a mixture of staple fibre of different lengths and thickness. The assessees have used such synthetic waste to the extent of 48% in the manufacture of disputed yarn as described in the classification lists filed by them".
The above facts clearly establish that the raw materials used in the disputed yarn were not synthetic staple fibre. Still the chemical examiner, vide his test reports at Annexure 'B' to the authorisation, has reported that the yarn contained synthetic staple fibre . Obviously, therefore, his reports are based on misconception of the definition of "staple fibre" and consequently these test reports cannot be reliable basis for determining the classification. The Revenue's appeal is based on these test reports. The Revenue has not produced any material, except these test reports, to prove that the yarn in dispute contained synthetic staple fibre. On the other hand, the Collector (Appeals) has given convincing reasons to hold the classification of the yarn under Heading 55.05.
16. In the light of the above discussion, classification under Heading 54.06 is ruled out. The yarn also does not fall within the ambit of Heading 5504.31 as it is not yarn containing other synthetic staple fibre in the form of waste or in the form of fibre produced out of such wastes, in which acrylic or modacrylic staple fibre predominates by weight. The yarn is rightly classifiable under Heading 55.05.
17. In the result, we uphold the order of the Collector (Appeals) and dismiss the appeal.
18. The respondents filed a cross-objection. The same gets disposed of by our above conclusion. As the classification is decided in their favour, we are not required to give any findings regarding limitation under Section 11A of the Central Excises & Salt Act, 1944.