Manufactured yarn and sizing: sizing applied after yarn emerged from ring frames was treated as a weaving process, not spinning.

Yarn emerging from the ring frames was treated as fully manufactured and excisable goods once the spinning process was complete, because the material had already passed through the blow room and other stages and come into existence as finished commercial yarn. Sizing was held to be a subsequent operation applied only when the yarn was intended for weaving, after it had already become a manufactured article. On that basis, sizing was characterised as part of the weaving department and not the spinning process, and the assessee's position was accepted.

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Issues: Whether the yarn emerging from the ring frames was fully manufactured and excisable before sizing, so that sizing was not part of the spinning process but of the weaving process.

Analysis: The uncontroverted factual averments showed that blending of fabrics took place in the blow room, after which the material underwent further processes and emerged from the ring frames as complete yarn. At that stage it had become a finished commercial commodity and an excisable article. The yarn was then gathered on bobbins, cones or reels for sale, and when intended for weaving it was wound on beams and sized. On those facts, sizing was treated as a subsequent step carried out after the yarn had already come into existence as manufactured yarn, indicating that it belonged to the weaving department and not the spinning department.

Conclusion: The question was answered in favour of the assessee. Sizing was held not to be part of the spinning process, and the appeal was rejected.

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