Customs, Excise and Gold Tribunal - Delhi
Collector Of Central Excise vs Arunodaya Mills Ltd. on 3 October, 1997
Equivalent citations: 1997(96)ELT181(TRI-DEL)
ORDER
U.L. Bhat, J. (President)
1. Department has filed the present appeal against the Order-in-Appeal No. 435/90 passed by the Collector of Central Excise (Appeals), Ahmedabad setting aside the Order-in- Original No. 52/85, dated 9-9-1985 passed by the Assistant Collector of Central Excise, Rajkot.
2. Respondent is engaged in the manufacture of yarn. We are concerned in the appeal with the correct classification of cellulosic spun yarn blended with synthetic waste and manufactured by the respondent. There is no dispute that the yarn falls under Sub-item HI of erstwhile Tariff Item 18 which refers to cellulosic spun yarn. The dispute in the appeal is whether Clause (i) or Caluse (ii) of Sub-item III of Tariff Item 18 is attracted.
3. Yarn in which man-made fibre or cellulosic origin predominates by weight and in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power falls under Sub-item III. In the yarn manufactured by the respondent, man-made fibre of cellulosic origin predominates in weight inasmuch as it was 51.7% by weight. 48.3% by weight was stated by the Chief Chemist to be fibre of non-cellulosic origin. Respondent disputed this description and contended that 48.3% by weight was not fibre of non-cellulosic origin but was waste of non-cellulosic origin or synthetic waste. The Chief Chemist indicated in his report that 48.3% by weight was fibre of non-cellulosic origin. He was cross-examined on behalf of the assessee. In his cross-examination he stated that once yarn is manufactured, it is not possible to determine by chemical test whether the input was non-cellulosic waste or non-cellulosic fibre and that chemical test will reveal only the non-cellulose or cellulose content of the sample. He gave his opinion to the effect that once yarn is manufactured it is not necessary to know the source from which the fibre had been obtained for Central Excise purpose. He was questioned whether he was aware of the decision of Collector (Appeals) in the matter of Eastern Spinning & Weaving Mills, Calcutta to the effect that yarn made by blending viscose with non-cellulosic waste would attract Tariff Item 18-III(i), he answered that he was not aware of it. We find that the decision of the Collector (Appeals) in Eastern Spinning & Weaving Co. Ltd. was challenged by the Department before the Tribunal and the appeal along with certain other appeals were disposed of by the Tribunal by the order reported in 1991 (37) ECR 542 (Tribunal) upholding the contention of the assessee and holding that the yarn in question was manufactured by blending cellulose fibre with synthetic waste and not synthetic fibre and therefore attracted Tariff Item 18-IH(i). On a similar reasoning, the Collector (Appeals) in the present case upheld the contention of the assessee that the correct classification would be under Tariff Item 18-III(i).
4. Shri Satnam Singh, SDR referred to the grounds of appeal in the Appeal Memo and relied heavily on the report of the Chief Chemist who opined that yarn was blend of cellulosic fibre and non-cellulosic fibre. According to him, the source from which fibre content had been derived has no relevance and spun yarn could not have been manufactured by blending cellulose fibre with synthetic waste and the product could have been manufactured only by blending cellulosic fibre with synthetic waste fibre. According to him, since some material of non-cellulosic origin is present in the yarn, Clause (ii) and not Clause (i) of Tariff Item 18-111 would be attracted.
5. All the above contentions were considered and repelled by the Tribunal in the decision reported in 1991 (37) ECR 542 (Tribunal). The contention of the assessee that blending was of the man-made fibre of cellulosic origin and waste of non-cellulosic origin has not been effectively controverted by the Department, except in the shape of the opinion of the Chief Chemist, which did not stand the test of cross-examination as is evident from the answers given in the cross-examination and referred to earlier. Since spun yarn manufactured by the respondent is a blend of fibre of cellulosic origin and synthetic waste (and not fibre), we agree with the view taken by the Collector (Appeals) that Clause (i) and not (ii) would apply.
6. For the reasons indicated above, we find no ground to interfere and accordingly dismiss the appeal.