TMI Blog1988 (2) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... the Deputy Chief Chemist, Central Revenues Control Laboratory (to whom a sample was sent) that the scouring and dyeing imparted to the yarn a fluffy appearance, a characteristic of bulked yarn. In appeal, the orders were upheld by the Collector (Appeals) by his impugned order, dated 10.11.86 which is now under challenge before us. 2. We have heard Shri Hardev Singh and Shri Dushyant Dave, Advocates, for the appellants and Shri K.C. Sachar and Shri Balbir Singh, D.Rs., for the respondent and read the record. 3. Before we discuss the rival contentions, it is expedient to set out the Tariff Entry as it stood during the material period and as substituted by the Finance (No.2) Act, 1977. Item No. 18, CET as substituted for the pre-existing entry by the Finance Act of 1975, read as follows : 18. RAYON AND SYNTHETIC FIBRES AND YARN INCLUDING TEXTURED YARN, IN OR IN RELATION TO THE MANUFACTURE OF WHICH ANY PROCESS IS ORDINARILY CARRIED ON WITH THE AID OF POWER - Fibres and Yarn, other than Textured Yarn(i) Eighty five rupees per kg. Textured Yarn produced out of base yarn(ii) The duty for the time being leviable on the Base Yarn, if not already paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cally included in Explanation II to Item No. 18, CET, and therefore, fell within the meaning of Textured Yarn falling under Sub-item (ii) of Item No. 18. However, the learned counsel submitted that the Tribunal s order did not constitute a binding precedent since the tariff entry was clear and no question of interpretation was involved. It was his contention that Explanation I(iv) referred to filament yarn only and not to spun yarn. The phrase but does not include bulked yarn and stretch yarn occurred in Sub-clause(iv) of Explanation I and it was not, therefore, correct to say, as the Tribunal has done in its earlier decision, that the said phrase could also be read into clauses (ii) and (iii) of Explanation I. What was excluded from Explanation I(iv), namely, bulked yarn and stretch yarn was specifically included in the definition of Textured Yarn in Explanation II which pertains to filament yarn and this clearly shows that the term Bulked Yarn also referred to filament yarn only. Assuming that the subject goods had the appearance of bulked yarn, it was for the department to show that they had been produced out of base yarn and this the department had not done. The goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Textured Yarn has been defined in Explanation II to Item No. 18, CET (as it stood during the material period) as yarn that has been processed to introduce crimps, coils, loops or curls along the length of the filaments and shall include bulked yarn and stretch yarn. Again, it is nobody s case that the subject goods are stretch yarn. The only question to be, therefore, considered is whether they are bulked yarn. 10. Some of the relevant definitions to be found in the standard works of Textile Terms and Definitions published by the Manchester Textile Institute, Fairchild s Dictionary of Textiles and the Indian Standard published in IS : 1324-1966 Glossary of Textile Terms Relating to Man-Made Fibre and Fabric Industry which, are of help in throwing light on the dispute are extracted below : From Textile Terms and Definitions published by the Manchester Textile Institute - Bulked Yarns - Yarns that have been treated physically or chemically so as to have a noticeably greater apparent volume or bulk. Note 1 : Continuous-filament yarns : The increased bulk may be obtained by tne introduction of crimps, coils, loops, or other fine distortions along the length of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th a warmer handle; some textured yarns also confer extensible or stretch properties on fabrics made from them. From Fairchild s Dictionary of Textiles - Bulky Yarns - Continuous filamlent synthetic yarns which have greater bulk than the regular yarns of this type because of their cross-section, for example a Y-cross-section. Also see Textured, Lofted, Modified and High Bulk Yarns. High Bulk Yarns - Spun synthetic yarns which owe their bulk to the blending of preshrunk and unshrunk fibres in which the different degree of shrinkage in the fibers in wet finishing produces a bulking out of the yarn. Used in bulky-look sweaters. Textured, Lofted or Modified Yarns - Continuous filament synthetic yarns in which the filaments have been crimped or have had random loops imparted, or are otherwise modified to create a yarn with a different surface texture. Textured Yarns - A genera classification for continuous filament man-made fiber yarns which have been treated to give them hand and appearance which is different from the untreated yarn and-/or stretchy. These yarns, in some cases, exhibit spun yarn effects. The yarns may be crimped, curled, coiled, distorted through air-jet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the Assistant Collector had approved classification lists submitted by the appellants. The show cause notice, dated 24.6.1976 does not lay any satisfactory basis for alleging that, on the basis of certain additional material that had come to light, the goods were re-classifiable as bulked yarn under Item No. 18(ii) of the CET. All that it says is that acrylic hand knitting yarn which is dyed/bleached/scoured and subjected to any treatment with steam or hot water will be classifiable under the said Item No. 18(ii). This seems to be more in the nature of an ipsi dixit and does not disclose any basis for it. 12. The matter can be examined from another angle also. Item No. 18, CET, as it stood during the material time, has been reproduced earlier in this order. Textured Yarn has been defined as yarn that has been processed to introduce crimps, coils, loops or curls along the length of the filaments (so far, there is no problem and no cause for dispute) and shall include bulked yarn and stretch yarn. It is the case of the appellants that bulked yarn is produced only out of filament (continuous) yarn and not out of spun (discontinuous) yarn. This contention cannot be accep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut of acrylic fibre is specified at Sl. No. 3 of Central Excise Notification No. 27/75 dated 1.3.1975 and is shown as falling under Item No. 18(i) of the CET. Though notifications issued under Rule 8(1) of the Central Excise Rules cannot be taken to be decisive of the classification of goods under the First Schedule to the Central Excises and Salt Act, this notification can be taken as an index of the understanding of the highest authority, namely, the Central Government concerned with the administration of the Central Excise Act, of the classification of acrylic hand knitting yarn. The fact that the subject hand knitting yarn has been subjected to the process of dyeing and steaming resulting in a fluffy appearance does not, in my opinion, detract in any way from the position that it still remains acrylic hand knitting yarn which correctly fell under Item No. 18(i) of the CET during the relevant period. 14. For the reasons set out by me, I am, with respect, unable to agree with the conclusion of the Tribunal in the case of Gokal Chand Rattan Chand Woollen Mills (supra) classifying similar yarn under Item No. 18(ii) of the CET. 15. In this view of the matter, the appeals deserve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ypes of bulked yarn and stretched yarn. It appears to me that when the language of the entry is thus clear it would not be permissible to look into the entry as it stood in a subsequent year (after amendment) in order to read into the entry a meaning which would not be strictly in accordance with the words in the entry. We cannot enlarge the meaning, seeking support therefor with reference to the entry in the subsequent year after amendment. 19. I am, therefore, of opinion that the classification under Item 18(ii) CET as ordered by the lower authorities was correct. 20. But, as pointed out by the appellants, the demand refers to a period during which the clearances were effected in pursuance of approved classification lists. It is open to the Department to change the approval on the classification list in the circumstances mentioned by the Delhi High Court in J.K. Synthetics Limited v. Union of India and Others (1981 E.L.T. 328). Admittedly none of the circumstances mentioned in the said judgements were available to the Department for changing the earlier decision on the question of classification. The present appears to be a case where on a rethinking the Department came to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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