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of <h1>Tribunal Overturns Order on Yarn Misdeclaration, Emphasizes Tolerance Limits</h1> <h3>SWAMI SAMARTHA SHETKARI VA VINKARI SAHAKARI SOOT GIRNI NIYAMIT Versus CCE., AURANGABAD</h3> SWAMI SAMARTHA SHETKARI VA VINKARI SAHAKARI SOOT GIRNI NIYAMIT Versus CCE., AURANGABAD - 1999 (111) E.L.T. 862 (Tribunal) Issues: Misdeclaration of yarn counts, reliance on Wrapping Register entries, application of tolerance limits, corroborative evidence requirement, remand for redetermination of demand.The judgment pertains to an appeal against an Order-in-original passed by the Collector of Central Excise, Aurangabad, alleging misdeclaration of yarn counts based on Wrapping Registers. The appellants argued that Wrapping Registers only indicate average yarn counts for quality control and do not serve as authenticated records for counts. They contended that corrective measures were promptly taken to ensure conformity to declared counts, supported by the absence of count variations found by the Deputy Chief Chemist during testing. The appellants also highlighted the impact of environmental conditions on yarn counts and sought the application of tolerance limits specified by the Board.The department, represented by the learned DR, argued that tolerance limits from earlier instructions should apply, emphasizing that even with a 5% tolerance, counts exceeded the declared figures. The department pointed out instances where the appellants admitted manufacturing yarn of slightly higher counts, justifying the sustained extended period for scrutiny.The Tribunal referenced a previous case where private register entries were deemed unreliable without corroborative evidence. However, in the present case, the Tribunal noted a statement by the Incharge, Spinning Master, admitting to manufacturing higher count yarn for market demand, specifically for counts 34 and 35. This admission provided corroboration for the Wrapping Register entries concerning these counts.The Tribunal disagreed with the Collector's view on the applicability of tolerance limits, asserting that the limits set in the CBEC letter of May 1987 should guide count determination and duty imposition. The judgment emphasized the importance of acknowledging potential errors in spinning, sampling, and testing processes in determining yarn counts.Regarding other counts not supported by corroborative evidence, the Tribunal followed the precedent set in the previous case and concluded that Wrapping Register entries could not be solely relied upon. Consequently, the order was set aside, and the matter was remanded to the Adjudicating authority for a reassessment of the demand concerning counts 34 and 35, considering the application of tolerance limits. The Collector was directed to issue appropriate orders, including any penalties applicable for the relevant period.
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