Revision maintainability and cotton waste exemption accepted for yarn made from Yellow Pickings, defeating duty demand and penalty.

Revision under Section 35A of the Central Excises and Salt Act was maintainable even though no appeal had been filed within the Section 35 limitation period, because Section 35A did not restrict revision to orders from which no appeal lay; the absence of a timely appeal did not bar revision. Cotton yarn manufactured from "Yellow Pickings" qualified for exemption under Notification No. 95/61 as the material was treated as cotton waste, and the exemption accordingly extended to the finished yarn. On that basis, the duty demand and penalty could not stand, and the assessee obtained relief on both maintainability and exemption.

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Issues: (i) Whether a revision application under Section 35A of the Central Excises and Salt Act was maintainable despite no appeal having been filed within the limitation prescribed for appeals under Section 35 of the Act; (ii) Whether cotton yarn manufactured from "Yellow Pickings" was entitled to exemption under Notification No. 95/61 dated 1-4-1961 on the footing that "Yellow Pickings" constituted cotton waste.

Issue (i): Whether a revision application under Section 35A of the Central Excises and Salt Act was maintainable despite no appeal having been filed within the limitation prescribed for appeals under Section 35 of the Act.

Analysis: Section 36, dealing with revision by the Central Government, expressly applied only where no appeal lay from the order sought to be revised. Section 35A, however, contained no stipulation limiting revision to orders from which no appeal lay. The absence of an appeal within the statutory period under Section 35 did not, by itself, bar recourse to revision under Section 35A.

Conclusion: The revision application was maintainable, and the Board's refusal on that ground was erroneous.

Issue (ii): Whether cotton yarn manufactured from "Yellow Pickings" was entitled to exemption under Notification No. 95/61 dated 1-4-1961 on the footing that "Yellow Pickings" constituted cotton waste.

Analysis: The Tribunal followed its earlier decision in a similar matter and held that "Yellow Pickings" fell within cotton waste for the purposes of the exemption notification. Once that classification was accepted, the yarn manufactured out of such material was covered by the duty exemption.

Conclusion: The cotton yarn manufactured from "Yellow Pickings" was eligible for duty exemption, and the duty demand and penalty could not be sustained.

Final Conclusion: The appeal succeeded, the impugned order was set aside, and the assessee obtained relief both on maintainability and on the substantive exemption claim.

Ratio Decidendi: Where the revisional provision does not expressly restrict revision to orders against which no appeal lies, failure to file an appeal within limitation does not bar revision; and material treated as cotton waste qualifies for exemption when the notification extends relief to goods manufactured from such waste.

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