Excise exemption for cotton fabrics processed without power or steam upheld on unrebutted factual findings.

Cotton fabrics processed without the aid of power or steam qualified for exemption under the relevant central excise notification because the decisive issue was whether the processing was in fact carried out manually. The adjudicating authority accepted evidence that the unit performed scouring, bleaching and dyeing without power or steam, and the Revenue produced no material to rebut those findings. The fabrics were also treated as unprocessed cotton fabrics on the record, with nothing establishing processing by power. The exemption was therefore upheld and the Revenue's challenge failed.

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Issues: Whether the respondents were entitled to exemption from central excise duty under the relevant exemption notification for cotton fabrics processed without the aid of power or steam.

Analysis: The exemption depended upon the factual question whether the cotton fabrics had been processed without the aid of power or steam. The evidence accepted by the adjudicating authority showed that the respondents' unit claimed to carry out scouring, bleaching and dyeing without such aid, and the Revenue placed no material to dislodge those factual findings. The appeal also proceeded on the footing that the goods were unprocessed cotton fabrics, and nothing on record established that the fabrics had been processed with the aid of power.

Conclusion: The respondents were held entitled to the exemption, and the Revenue's challenge failed.

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