TMI Blog2000 (11) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... to Notification No. 63/87-C.E., dated 1-3-1987 for the period from 1-3-1987 to 11-6-1989?" 2.Revenue questions the correctness of order-in-original No. 416/CEX/93 dated 23-12-1993. That order happened to be passed by Collector of Central Excise and Customs, Aurangabad in a proceeding initiated pursuant to show cause notice dated 5-6-1992. Respondent, Entremonde Polycoaters Ltd. are engaged in the manufacture of impregnated, coated, covered or laminated cotton textiles classified under Chapter 59 of the Schedule to the Central Excise Tariff Act, 1985. They claimed concessional rate of duty in terms of Notification No. 63/87-C.E., dated 1-3-1987. As per the show cause notice, respondent could not have claimed concessional rate of duty in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cs classifiable under Chapter 60 were used in the manufacture of the finished goods. The contention raised by the department is that since base fabric used by the respondent in the manufacture of the finished goods was not falling under Chapter 52, benefit of Notification No. 63/87-C.E. is not available to the assessee. 6.For a proper understanding of the notification and the relevant entry, we read the same : "Exemption to certain specified goods of Chapter 59. - In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts goods of the description specified in column (3) of the Table annexed and falling under heading No. or sub-heading No. the Schedule to the Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this Heading should be "of base fabrics of cotton." The items, which fall under Heading 59.03, are sub-divided into two categories, namely, 5903.11 and 5903.19. Sub-heading 5903.11 dealt with coated or laminated with preparations of low-density polyethylene. Other types of goods falling under Heading 59.03 are to fall under sub-heading 5903.19. Item 2 to the Table to Notification No. 63/87 related to this type of goods. 8.As stated earlier, base fabric used by the respondent in the manufacture of finished product was cotton. They were using knitted cotton. Knitted cotton was not one falling within Chapter 52. Base fabric being cotton, what should be the duty payable by the manufacturer in terms of the notification, Column 4 of the Table ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods which fell under Tariff sub-heading 5903.19. 10.The stand taken by the Revenue is that the base fabric used by the respondent being not one falling under Chapter 52 must be subjected to duty fixed under the Tariff Act. This having not been paid, proceedings were initiated by issuance of the show cause notice. This stand taken by the department is incorrect. Reference in this regard may be made to the decision of the Supreme Court in J.K. Steel v. Union of India, 1978 (2) E.L.T. (J 355) (S.C.) = 1969 (2) SCR 481. A close reading of Notification No. 63/87-C.E. shows that finished products falling under Tariff sub-heading 5903.19 made out of base fabrics of cotton should be liable to duty leviable on base fabrics falling under Cha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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