TMI Blog1970 (4) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... 61-62 and if it is covered by the term "woollen goods" then it would be assessable at the rate of one anna per rupee. The notifications with which we are concerned are: (i) Notification No. ST. 907/X dated 31st March, 1956. This is a notification under section 3-A of the Act and declares that the turnover of certain commodities mentioned therein should be taxed at a single point, at the point of sale by the manufacturer or the importer, at the rate of six pies per rupee. The relevant entry of that notification is at item No. 4 which reads: "Yarn of all kinds, including unspun fibre used in, weaving, other than handspun yarn, but excluding cotton yarn in cops and cones." (iii) Notification No. ST-1365/X-990-1956 dated 31st April, 1960. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the notifications applied and the turnover in dispute was assessable under section 3 as being the turnover of an unclassified item. This finding of the Assistant Commissioner (judicial) has been upheld by the judge (Revisions). At the instance of the Commissioner, however, the Judge (Revisions) has submitted the two references for the opinion of this court on the following question of law: "Whether the article 'carpet woollen yarn' is covered by the term 'yarn' mentioned in item No. 4 of Notification No. ST-907/X dated 31st March, 1956, and item No. 33 of Notification No. ST-1365/X dated 1st April, 1960, taxable as 6 pies and 3 pies per cent. respectively or a kind of woollen goods as mentioned at item No. 45 taxable at one anna per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee and also the affidavit filed by the assessee saying that in the production of the carpet woollen yarn sold by the assessee no spinning is involved. All that is done is that the woollen threads are straightened out and the strands of thread are slightly twisted. The assessee has also stated in its affidavit that it has no mules or spinning ring frames and therefore the product does not go through the final stage of spinning which is essential to the making of the yarn. The other finding recorded by the Assistant Commissioner (judicial) and confirmed by the judge (Revisions) is that the woollen carpet yarn is not used for weaving purposes in the manufacture of carpets. The process of carpet manufacture is that a base fabric is woven out of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was that the word "weaving" should qualify not only the unspun fibre but also the term "all kinds of yarn". If that be so, even on the finding that the carpet woollen yarn in dispute is not employed in the process of weaving but only in knotting, the contention of the assessee would appear to be correct. Apart from that we find that the carpet woollen yarn in question in fact would not be covered by the phrase unspun fibre used in weaving. In the Webster's Dictionary one of the meanings of the word "fibre" is "any tough substance composed of thread-like tissue whether of animal, vegetable, or mineral origin esp. that capable of being spun and woven; as wool or silk fibre, hemp or flax fibre, cellulose (rayon) fibre, asbestos or glass f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 2 above. The alternative contention of the department that the woollen carpet yarn in question should be taxed under notification No. 3 referred to above as "woollen goods" need not detain us long. The words "woollen goods", in our opinion, mean finished goods and not the raw material from which the goods are prepared. There is a clear distinction between the raw material and the finished goods like iron and iron goods, cotton and cotton goods, wool and woollen goods. Woollen fibres in question can by no stretch of imagination be regarded as woollen goods. In J. K. Cotton Manufacturers Ltd. v. Commissioner of Sales Tax, U.P.[1963] 14 S.T.C. 777., this court held that canvas cloth and canvas goods were two different things and as su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... try. For all these reasons we would answer the question by saying that the carpet woollen yarn in question would not fall in any of the three entries mentioned in the notifications referred to above. It is an unclassified item and its turnover would be taxable at the rate of 2 per cent. under section 3 of the Act. As regards the special appeal, precisely the same question was mooted before a learned Single judge of this court. Reliance was placed on behalf of the department on the case of British India Corporation[1962] 13 S.T.C. 459., where it was held that woollen carpet yarn would be included in the entry "woollen goods and knitting wool". The learned Single judge merely followed that ruling with the observation that he was bound by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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