Processed nylon yarn retained its character as yarn and remained taxable under the general yarn entry.

Chemically processed nylon yarn retained its essential character as yarn because the treatment only improved strength and did not alter its nomenclature, commercial identity, or classification. The court found no basis to treat the material as shoe material or as an unclassified item; it continued to fall within the entry for all kinds of yarn. The revisional challenge failed, and the assessee's classification was accepted.

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Issues: Whether chemically processed nylon yarn ceased to be yarn and became an unclassified shoe material, or continued to fall under the entry for all kinds of yarn.

Analysis: The turnover concerned imported nylon yarn which had undergone a chemical process and was sold for use by shoemakers. The decisive question was whether that processing brought about a commercially different commodity. The relevant notification covered "yarn of all kinds except those covered by any other notification". The finding recorded was that the chemical treatment merely improved the strength of the yarn and did not change its essential character, nomenclature, or commercial identity. The material continued to be yarn and there was no basis to treat it as shoe material or as an unclassified item.

Conclusion: The processed nylon yarn remained yarn and was taxable under the entry for all kinds of yarn. The revisional challenge failed and the assessee's view was accepted.

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