Finishing processes on knitted fabrics held integral to manufacture, with grey fabric status not lost for duty purposes.

Back coating, shearing, cropping and electrifying polish on sliver knitted fabrics were treated as finishing operations already covered by earlier tribunal reasoning on knitted fabrics. The Tribunal held that such processes are integral to manufacture and do not by themselves convert grey fabrics into a separately dutiable product merely because finishing work has been carried out. Applying the earlier decision, it rejected the contention that the fabrics had ceased to remain grey or unprocessed for duty purposes, and the appeal was allowed.

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Issues: Whether the processes of back coating, shearing or cropping, and electrifying polish undertaken on sliver knitted fabrics amount to manufacture or other dutiable processing, or whether the fabrics continue to remain grey/unprocessed and therefore not liable to duty.

Analysis: The Tribunal followed the earlier decision holding that similar processes such as dyeing, coating, back coating, shearing and polishing are integral to the manufacture of knitted fabrics and that fabrics do not cease to be grey merely because such finishing operations are carried out. Since the controversy was already covered by that decision, the same reasoning was applied to the present case.

Conclusion: The processes did not make the fabrics dutiable in the manner alleged, and the appeal was allowed.

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