TaxTMI 
TaxTMI 
1969 (10) TMI 69
X X X X Extracts X X X X
X X X X Extracts X X X X
....3 which exempt from payment of excise duty cotton yarn of 17 counts or more but less than 35 counts, if cleared out of factory in 'hanks'. The appellant is a company engaged in the manufacture and sale of cotton yarn. It has been manufacturing cotton yarn of varying counts ranging from 20 to 32. Under the provisions of the Central Excises and Salt Act, 1944, cotton yarn is liable to excise duty at the rate prescribed in the Sch. to the said Act. By s. 13(1) of the Finance Act, 1961 (Act XIV of 1961) all cotton yarns less than 35 counts were subject to excise duty at the rate of 10 Np. per Kg. This provision took effect from 1-3-1961; but the Government by its notification dated 24-4-1962 under rule 8 of the Central Excise Rules 1944 grante....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng 'hanks'. Thereafter as per his communication dated January 1, 1963, the Deputy Superintendent called upon the appellant to pay a sum of Rs. 46,647.85 np. as excise duty in respect of the single yarn produced by it and cleared out of the factory in coils. A further communication was sent to the appellant by the same Dy. Superintendent in respect of the same demand on January 2, 1963. The appellant objected to the demand but the appellant's objections were rejected by the Asstt. Collector on April 14, 1963. Thereafter the appellant unsuccessfully appealed to the Collector of Central Excise. During the pendency of the proceedings, the Government of India by its notification dated February 16, 1963 issued in exercise of its powers under rule....
X X X X Extracts X X X X
X X X X Extracts X X X X
....that High Court rejected the prayer of the appellant, accepting the contention of the department that the word 'hank' in Exh. P-2 and P-3 has been used to convey a special meaning, i.e. a circular loop or coil of cotton yarn 850 yards in length; Hence the appellant was not entitled to the exemption granted under those notifications. In support of their conclusion that the word 'hank' has acquired a precise technical meaning in commercial circles, the learned judges of the High Court referred to the definition given to the word 'hank' in Murray's New English Dictionary, "Mercury Dictionary of Textile Terms", "American Cotton Hank Book" and to some of the Government publications. Thereupon the appellant brought this appeal. It may be taken t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... cotton yarn less than 768 metres in length according to that notification has to be considered as a 'hank'. But according to the technical meaning acquired by the word 'hank' in commercial circles, the length of the cotton yarn in the reel should be neither more nor less than 768 metres (840 yards). This notification makes it clear that when the Government issued the notification Exh. P-2, it intended to give the word 'hank' the meaning "a coil of yam" and nothing more. Secondly if in Exh. P-2, the word 'hank' has been used in the way it is understood in commercial circles there was no point in giving retrospective effect to the explanation added to Exh. P-2 by the notification dated February 16, 1963. The rule making authority's intention....