Duty on finished cotton fabrics follows binding Larger Bench interpretation under Notification No. 63/87-C.E.

Finished products under Tariff sub-heading 5903.19 made from base cotton fabrics were treated, under Notification No. 63/87-C.E., as attracting duty at Rs. 7 per square metre in addition to the duty leviable on the base fabrics under Chapter 52. The Larger Bench interpretation on this point was binding, and no distinguishing feature was shown. The duty demand was therefore required to be computed in accordance with that interpretation, and the Revenue's challenge failed.

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Issues: Whether finished products falling under Tariff sub-heading 5903.19 made out of base cotton fabrics were liable to duty at Rs. 7 per square metre plus the duty leviable on the base fabrics under Chapter 52.

Analysis: The issue had already been decided by the Larger Bench, which construed Notification No. 63/87-C.E. to mean that finished products under Tariff sub-heading 5903.19 made out of base cotton fabrics attract duty leviable on the base fabrics falling under Chapter 52, together with Rs. 7 per square metre. That view was binding, and no distinguishing feature was shown.

Conclusion: The demand was to be computed in accordance with the Larger Bench view, and the Revenue's challenge failed.

Final Conclusion: The appeal was rejected and the duty position declared by the binding Larger Bench interpretation was left undisturbed.

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