1995 (12) TMI 179

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ng under T.I. 18 from basic raw material of Cashmilon fibre, which is a mixture of Shrinkable and non-shrinkable fibre, out of which Yarn is made by spinning process and the same is then steamed and processed in Hank dyeing machines in their factory. A Show Cause Notice dated 6-3-1976 was issued by the concerned Superintendent of Central Excise calling upon the respondents to show cause as to why the duty amounting to Rs. 2,50,977.85 be not demanded from them alleging that they had cleared 100% acrylic textured yarn, that is to say, bulked yarn without payment of Central Excise Duty leviable thereon under sub-item (ii) of T.I. 18 for the period from 1-3-1975 to 29-4-1975 and 30-4-1975 to 16-12-1975. The respondents hotly contested the Show ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ppeal by the Revenue. 3. Appearing on behalf of the Revenue, Shri Mohan Lal, learned JDR, submitted that the respondents undertake the process of dyeing of acrylic yarn. The yarn is first passed through steam and then dyed in Hank Dyeing machines. As a result of this process, the yarn becomes slightly fluffy and introduces noticeable bulked yarn. He took us through the definition of "Bulked Yarn" as given in the Textile Terms and Definition, sixth edition of Textile Institute of Manchester, to show that Bulked Yarn could be produced not only out of the continuous filament yarn but also out of staple yarn. He also took us through the method of texturising yarns as given in the "Standard Handbook of Textiles" by A.J. Hall, and to the ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....its in support of his conclusion. On appeal by the Revenue before the Collector (Appeals), the Collector (Appeals) also affirmed the said findings of the Assistant Collector, adding that "In the absence of any test carried out by the Department either of the grey acrylic yarn, the dyed and bleached yarn, there is no warrant whatsoever in holding that the processed yarn is bulked yarn. In any case, the Department, has not informed the respondents the basis on which such conclusion was arrived at. This amounts denial of natural justice. In the circumstances, the respondents get "the benefit of doubt". The contention of the Revenue that the test report given by the SASMIRA cannot be relied upon as the respondents got the samples tested after t....