2001 (8) TMI 437

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....In his statement dated 25-1-1989, Shri Ashwani Chopra, Partner, admitted the manufacture of the goods above and agreed to pay the Central Excise duty leviable. The Dy. Commissioner of Central Excise in his Order-in-Original dated 3-2-1998 imposed a redemption fine of Rs. 37,000/- and levied a penalty of Rs. 50,000/-. It was ordered that on release the goods should be accounted for in the Central Excise statutory records and be cleared on payment of appropriate Central Excise duty. On appeal, the Commissioner of Central Excise (Appeals), vacated the order passed by the Dy. Commissioner of Central Excise and accepted the appeal of M/s. Asha. As summarised in the impugned order-in-appeal, M/s. Asha in their appeal before the Commissioner of Central Excise (Appeals) had taken the following ground:- (a)      That the analytical notes of the Chemical Examiner do not indicate that any test had been carried out to establish that the sample is staple fibre yarn. (b)      That the Tribunal in the case of M/s Asha Jyoti Spinning Mills v. Collector of C.E. Chandigarh reported as 1995 (60) ECR 584 (Tri.) has held (in para 7) that "A staple....

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....lassify a yarn as staple fibre yarn under Heading 55.04; (i) The length of the fibre and (ii) denier of the yarn should be uniform. In the present case it is on record that the length of the fibre has not been determined. In the absence of determination of uniform length of the fibre, it cannot be said with certainty that the yarn in question was staple fibre yarn. I therefore going by the ratio of the Hon'ble Tribunal and explanatory Notes to HSN (supra) hold that the lower adjudicating authority was not able to prove that yarn in question was staple fibre yarn. As a result benefit of doubt goes to the appellant. Accordingly, I vacate the order of the lower adjudicating authority & accept the appeal. 2. We have heard Shri R.C. Sankhla, JDR and Shri K.K. Bassi, Advocate and have gone through the facts on record. 3. It is a fact on record that when the Central Excise officers visited the factory premises of M/s. Asha, 81 gunny bags containing synthetic yarn in fully manufactured and packed condition were placed in the factory premises. They were not accounted for in the excise records. The weight of such yarn was 4860 kgs. On test, the yarn was found to be 100% polye....

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....gs. of yarn of polyester staple fibre at the material time without observing Central Excise Law.           It is clear that simply non-calculation of length of the fibre and denier of the yarn should not be the reason to give the benefit of doubt to the party since the sample have been tested twice by the CRCL, New Delhi and also by the local agencies wherein the test report goes against the party. (iv)    that, the remnant sample was got re-tested in compliance to the Direction of Hon'ble CEGAT, New Delhi as per Order No. S/133/90-D & E/515/90-D, dated 27-6-1990. As per re-test report sample was reported as "single ply white spun yarn having slubs at different intervals, wholly composed of man made synthetic staple fibres of non-cellulosic origin (polyester)". It was reported that diameter of the fibres used in the making of yarn were mostly uniform and free from fused fibres and extraneous matter, and sample of the yarn in question be not considered as yarn made directly from synthetic fibre waste but made out of spinnable fibres. (v)     that, in compliance to the CEGAT Final Order No. 239/9....

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...., the observation of the Commissioner (Appeals) vide O-I-A No. 87/CE/CHD-1/2001, dated 19-2-2001 that, in order to classify a yarn as staple fibre yarn under Heading 55.04(i) the length of the fibre and (ii) denier of the yarn should be uniform, is not correct in view of the facts mentioned above especially in view of the facts narrated by Sh. Badri Parsad, Chief Chemist during his cross-examination that yarn was made out of fibres and from the yarn retrieval of fibre was difficult. That there was no prescribed method in any of the books on textile in which the correct method for determination of length of fibres from the yarn, without breaking the fibres, while untwisting the yarn manually was given. That in this case length of fibre was not determined. The ld. Chief Chemist further elaborated that synthetic waste here meant synthetic fibre waste. That synthetic hard waste was first opened and fibres were retrieved from it, fibres were parallelised and cut into staple length. That soft waste of fibre was cleared and both types of staple length obtained from hard waste and soft waste were spun into yarn.           Secondly, all the te....