Zero Zero Machine processing held to be calendering, with clarificatory amendment applying retrospectively for excise purposes.

Processing of calendered cotton fabrics with a Zero Zero Machine without a stenter attachment was treated as calendering, not shrink-proofing, for excise purposes. The explanatory amendment describing such finishing as calendering was accepted as clarificatory rather than prospective, so the departmental argument on limited future operation failed. On that basis, the earlier Tribunal view was followed and the processing was held not to bring the goods within the excise net.

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Issues: Whether processing of calendered cotton fabrics with the aid of a Zero Zero Machine without a stenter attachment amounted to shrink-proofing so as to attract excise duty, and whether the explanatory amendment concerning such processing was clarificatory in nature.

Analysis: The processing in question had already been held by the Tribunal in an earlier decision not to amount to shrink-proofing. The later explanation inserted in the notification treating finishing by a Zero Zero Machine without a stenter attachment as calendering was accepted as clarificatory. On that basis, the departmental contention that the benefit was only prospective was rejected, and the earlier ratio was followed.

Conclusion: The processing did not bring the goods within the net of excise duty. The appeals were allowed and the impugned order was set aside.

Ratio Decidendi: Processing of cotton fabrics with a Zero Zero Machine without a stenter attachment does not amount to shrink-proofing, and an explanatory amendment characterising such process as calendering is clarificatory.

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