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TMI Blog1987 (8) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... due to the misplacement of the impugned order and partly due to the absence owing to illness of the official concerned. Though Shri Sachar opposed the request for condonation, we were of the opinion that, in the circumstances explained, the delay ought to be condoned. Insofar as the supplementary appeals concerning this appeal as well as Appeal No. 606/83-D, these were occasioned by the requirements of the Tribunal and, therefore, the delay in filing these supplementary appeals was also condoned by us. 2. The issue involved in all these appeals is common and these appeals were, therefore, heard together and are disposed of by this consolidated order. 3. The appellants are a composite unit engaged in spinning cotton yarn and weaving cotton ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o cleared were not fully; consumed. He further held that Notification No. 131/77, the benefit of which was claimed, was applicable only to the extent that no further duty could be. charged and the hanks in question could be cleared up without payment of duty. It is these orders that are now under challenge in these appeals. 4. We have heard Shri S.P. Kampani, Consultant for the appellants and Shri K.C. Sachar, D.R. for the respondent. 5. Shri Kampani submitted that the Assistant Collector and the Appellate Collector were not correct in referring to the subject yarn as having been retrieved from the weaving section. In fact, in every bobbin, at the end of the weaving process, a quantity of yarn was left which could not be utilised. This ya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Central Excise Rules 9 and 49. If yarn was ab initio cleared in straight reel hank form, the notification would apply but not in cases of conversion of duty paid yarn into hanks. He referred to the Tribunal's decision in the case of Collector of Central Excise, Indore v. Raj Kumar Mills Ltd. [Order Nos. 218 & 218A/86-D, dated 14-4-1986 in Appeal No. ED/SB/369 & 886/85-D] which laid down that waste occurring in the weaving process was not exempt from duty. 8. In reply, Shri Kampani referred to this Tribunal's decision in the case of Collector of Central Excise, Bhubaneswar v. Orissa Weavers Cooperative Spinning Mills, 1985 (21) E.L.T. 348. 9. We have carefully considered the submissions of both sides. There is no doubt that if the subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be, or, in fact, paid, but of the duty that was suffered by the yarn prior to its conversion into hank form, i.e., at the stage it was removed from the spinning section. It is nobody's case that this duty was not liable to be paid. 11. Again Rule 49 A cited by Shri Kampani does not help the appellants. It provides for deferment of payment of yarn duty till the stage of clearance of fabrics. It is no authority for the contention that duty is not required to be paid on such yarn as is left unutilised at the weaving stage and is sought to be removed out of the factory. No notification or rule has been shown to us exempting such yarn from the payment of duty. In this connection, we may note that, as pointed out by Shri Sachar, the Tribunal h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne stage, there was no removal for consumption or export or manufacture of some other commodity, hank yarn being only another form of cotton yarn. The Tribunal further noted that the object of incorporating an extended definition of "manufacture" in Section 2(f) of the Central Excises and Salt Act in relation to cotton yarn was to collect duty if hank yarn was cleared after availing full exemption from duty and was later converted into some other form of yarn as is evident from proviso (iii) to Notification No. 131/77. In the present case, yarn as manufactured was cleared internally on payment of duty for manufacture of fabrics. Duty was rightly charged on that yarn (there is no dispute that this, charge was not right) and quantities of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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