Special yarn classification upheld where core yarn and special attachments took Taspa yarn outside simple doubled yarn treatment.

Taspa yarn was held correctly classifiable as special yarn under Heading 56.06 because the evidence showed deliberate intertwisting of two yarns with a base yarn and covering yarn to create a special effect yarn with slub effect. The Court accepted the factual findings that the product contained core yarn and was made with special attachments, taking it outside simple doubled yarn under Chapters 50 to 55. Earlier conflicting classification rulings were found unhelpful on these facts. The classification was upheld, and the excise duty demand and penalty were sustained.

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Issues: Whether the appellant's 'Taspa' yarn was correctly classified as special yarn under Heading 56.06 of the Central Excise Tariff Act, 1985 and, consequently, whether the demand of central excise duty and penalty were sustainable.

Analysis: The material on record, including the manufacturing process, the chemical examiner's report, the statements of the appellant's partner and purchasers, showed that the product was manufactured by deliberately intertwisting two yarns with a base yarn and a covering yarn to produce a special effect yarn with slub effect. The Court accepted the findings of the adjudicating authority and the Tribunal that the presence of core yarn and the use of special attachments took the product out of the category of simple doubled yarn falling under Chapters 50 to 55. The Court also held that the earlier conflicting classification decisions did not assist the appellant because the facts here were specifically found to justify classification under Heading 56.06.

Conclusion: The classification under Heading 56.06 was upheld, the duty demand and penalty were sustained, and the appellant's challenge failed.

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