TMI Blog1996 (11) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... d raised by the Assistant Collector was not invalid. Against assessee & would be liable to pay the aforesaid amount of ₹ 35,190.96 plus interest the rate of twelve per cent per annum thereon. - 6622 of 1995 with 1778 of 1987 - - - Dated:- 26-11-1996 - A.M. Ahmadi, CJI., J.S. Verma and B.N. Kirpal, JJ. [Judgment per : B.N. Kirpal, J.]. - The respondent company is engaged in the manufacture of yarn falling under Tariff Item Nos. 18, 18B and 18E of the Central Excise Tariff. It manufactures single ply yarn and it also, in the course of its manufacturing process, does doubling and multifolding of the yarn. 2.The respondent was paying excise duty, in case of doubled or multifolded yarn, on the weight of doubled or multifolded y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the order of the Assistant Collector the respondent filed an appeal to the Collector (Appeals) who, vide his order dated 27th March, 1985, set aside the impugned order by holding that the duty was chargeable at the doubling/multifolding stage. 6.The appellant then filed an appeal before the Customs, Excise and Gold (Control) Appellate Tribunal contending that the single ply yarn had to be subjected to duty and by paying duty on the weight of the doubled yarn the respondent had avoided payment of the duty on the waste which was generated in the doubling of the yarn. The Tribunal, however, dismissed the appeal of the appellant. 7.In the present appeal it is contended on behalf of the appellant that the duty was payable when the single p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ows : "In our view, the High Court by the impugned judgment has rightly held that the appellants are not liable to pay any excise duty on the yarn after it is sized for the purpose of weaving the same into fabrics. No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn." The same principle would be applicable in the present case. A single ply yarn is first manufactured and thereafter it is doubled or multifolded, depending upon the type of fabric which is ultimately to be woven. The liability to pay excise duty would arise on the manufacture of the single ply yarn and not after the same has been doubled or multifolded. Doubling or multifoldi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s case with the only question whether single yarn attracts duty or not. In view of the finding of the Tribunal affirming the finding of the Assistant Collector that single yarn is a completely manufactured product, it cannot be disputed that it attracts duty. We are not concerned with the question whether the doubling/multifolding of the said yarn results in different goods or not and whether duty is leviable on doubled/multifolded yarn. We need only say that the Tribunal is right in its opinion that the single yarn is subject to duty though used in the manufacture of fabrics in a continuous process of manufacture." 11.These observations are not at variance with the decision in J.K. Spinning's case (supra). In view of the fact that an exc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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