TaxTMI 
TaxTMI 
1992 (5) TMI 100
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.... classified the product "Polyester Cotton Sari 67% + 33%, carbonised" under Central Excise Tariff Item 22(1)(b). They claimed partial exemption of duty in terms of Notification No. 35/84-C.E., dated 1-3-1984 which prescribed a concessional rate of duty on fabrics falling under Tariff Item No. 22 and containing less than 70 per cent Polyester fibre. On test, the composition of the fabric was found to be 100% Polyester. Therefore, the Asstt. Collector issued a notice requiring the appellants to show cause why the claim for concessional duty under Notification No. 35/84-C.E., dated 1-3-1984 should not be denied. The appellants claimed that the fabric manufactured out of 67% Polyester Fibre and 33% cotton could not be treated as consisting of 1....
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.... E.L.T.489 (Cal.). 3. On behalf of the Revenue the learned JDR Shri J.N. Nair stated that even though the grey fabric manufactured by the appellants contained 67% Polyester fibre and 33% cotton, after carbonisation the cellulosic or cotton content is eliminated and the resultant fabric consists of 100% Polyester. He contended that the Polyester content of such fabrics being in excess of 67%, they were not eligible to the concessional rate of duty in terms of Notification No. 35/84-C.E., dated l-3-1984.-He added that the assessment of such fabrics would depend on the composition of the final product and not on the contents of any intermediate product. In support of his contentions he placed reliance on the following decisions: 1. Union....
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....ster cotton fabric having less than 67% polyester on the basis of the composition of the base fabric which is subjected to carbonisation. In this regard, we find that in the case of Union of India and others v. Ahmedabad Manufacturing and Calico Printing Co. Ltd., reported in 1985 ,(21) E.L.T. 633, the Hon'ble Supreme Court has held that the classification of a manufactured product for the purpose of excise duty is dependent upon its nature and character at its final stage of production after all integral, incidental or ancillary processes of manufacture have been completed and the character of the goods at the intermediate stage of production cannot be taken into account for determining their classification under the Central Excises and Sa....
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....t is not possible to hold that the character of the goods at the intermediate stage of production could be taken into consideration for determining the liability under the Act. The processes involved in the instant case after the intermediate stage referred to above formed an integral part of the manufacture of the product in question and the classification of the manufactured product for purposes of excise duty should depend upon its nature and character at its final stage of production unless a contrary intention appears from the statute. It is seen from clause (vii) of Section 2(f) of the Act which is, no doubt, introduced subsequently that bleaching, heat setting etc. are incidental and ancillary processes necessary for the completion o....
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....is argument has no force at all since as held by the Apex Court the classification and dutiability of any item has to be determined only on the basis of its nature and character at its final stage. It, therefore, follows that character of the goods and consequently their classification at the intermediate stage would be irrelevant for determining their dutiability after completion of all integral process of manufacture. In support of their contentions the appellants have cited the decision of the Tribunal in the case of Collector of Central Excise v. Oriental Scientific Fire (supra) in which it was held that man-made fabrics even when subjected to a single process of dying become excisable. The ratio of this decision does not help the appel....