Exemption under Notification No. 109/86 survived because winding or rolling elastic tapes did not amount to an excluded fabric process.

Winding or rolling elastic tapes was not treated as a process excluded by the proviso to Notification No. 109/86 because the exclusion applied only to processes akin to bleaching, dyeing, printing or similar operations that bring about a lasting change in the fabric. The goods were regarded as fabrics for the purpose of the notification, and the operation was found to be merely winding or rolling without any change in structure or character. On that basis, the proviso did not apply and the exemption benefit under Notification No. 109/86 remained available.

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Issues: Whether the winding or rolling process applied to elastic tapes amounted to a process of the kind excluded by the proviso to Notification No. 109/86, so as to deny the exemption benefit.

Analysis: The exclusion in the notification had to be tested by whether the process was akin to bleaching, dyeing, printing or similar processes that bring about a change of lasting character in the fabric. The goods were treated as fabrics for the purpose of the notification, and the finding that the operation was merely winding or rolling, without change in the structure or character of the fabric, was not displaced.

Conclusion: The process did not attract the proviso and did not disentitle the assessee from the benefit of Notification No. 109/86.

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