TMI Blog2000 (9) TMI 568X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 Kgs of Taspa Yarn without payment of Central Excise duty during the period 26-11-1986 to 15-5-1987. Department took the view that the product was special yarn classifiable and chargeable to duty under Chapter Heading 56.06 of the Central Excise Tariff and, therefore, by show-cause notice dated 12-1-1990, directed the appellants to show cause why an amount of Rs. 3,45,368.88 should not be recovered from by them towards Central Excise duty on the aforesaid quantity of Taspa Yarn under Rule 9(2) of the Central Excise Rules read with Section 11A(1) of the Central Excises Salt Act (CESA) and also why penalty should not be imposed on them under Rule 173Q(1) of the said Rules. The show-cause notice was issued by invoking the extended period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... classifiable under Tariff Heading No. 56.06 as claimed by the Department. He relied on CBEC Circular No. 26/88-CX. 1, dated 10-10-1988, whereby the Board clarified its earlier Circular dated 26-4-1988 and laid down that if there was no core yarn in a fancy yarn, such fancy yarn would not be classifiable as special yarn under Tariff Heading 56.06. Ld. Counsel also relied on the decision of the Tribunal in the case of Pratik Crimpers v. Collector of Central Excise, Mumbai [1998 (101) E.L.T. 437 = 1998 (25) R.L.T. 24] and further on the decision of the Tribunal (Larger Bench) in the case of S.J. Vasania Silk Mills Ors. v. CCE, Surat - 2000 (119) E.L.T. 189 (Tribunal) = 2000 (38) RLT 964 in support of the appellants case that since there wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re fed together into the machine and were made to run at different speeds. The polyester yarn running at lower speed was the base yarn and the nylon yarn ran at higher speed over the base yarn, producing a slub effect on the product. According to ld. DR, the slow moving base yarn of polyester filament could be termed as core yarn. Ld. DR described the process as a special process, which gave a special design and shape to the final yarn, which emerged as a fancy yarn by virtue of its slub effect and differed from the normal construction of single and folded yarns. He, therefore, argued that the product should be classified as special yarn under Tariff Heading 56.06, especially since it contained a core yarn. He prayed for upholding the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom other manufacturers can be no evidence against the present appellants. The view taken by the adjudicating authority in this behalf is correct. The Additional Collector has rightly sustained the preliminary objection raised by the assessees against placing reliance on the test report relating to sample drawn from another manufacturer viz. M/s. Beekaylon Synthetics Pvt. Ltd. In this context, we must also observe that the appellants are also estopped from relying on such test report in the present appeal. On a perusal of the statement recorded by the Departmental officers from Shri M.K. Kapadia under Section 14 of the Act, we find that, nowhere in the statement, he admitted the presence of core yarn in the product, though he referred to ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oving so. In the absence of such proof as well as of any admission (by the assessees) of presence of core yarn in the product and in view of the fact that the process of manufacture in the instant case was identical with that in the case of Pratik Crimpers (supra), we are inclined to apply the ratio of the Tribunal s decision in Pratik Crimpers (supra) squarely to the present appellants case and to hold that, in the absence of core yarn in their product, the Taspa Yarn is not classifiable under Tariff Heading 56.06 for the period of dispute. We have also noted that the adjudicating authority has not recorded any specific finding that the product in question contained a core yarn. To classify the product under Heading 56.06 without such fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
