TaxTMI 
TaxTMI 
1996 (9) TMI 123
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....THETIC FIBRES AND YARN INCLUDING TEXTURED YARN, IN OR IN RELATION TO THE MANUFACTURE OF WHICH ANY PROCESS IS ORDINARILY CARRIED ON WITH THE AID OF POWER :- (i) Fibres and Yarn other than Textured Yarn. Rs. 85.00 per kg. (ii) Textured Yarn produced out of Base Yarn. The duty for the time being leviable on the base yarn, if not already paid plus Rs. 20/- per kg. (iii) Other Textured yarn Rs. 105.00 per kg. Explanation - I. "Fibres and yarn, other than Textured yarn", shall be deemed to include - (i) man-made fibres; (ii) man-made metallic yarn; (iii) spun (discontinuous yarn containing not less than ninety per cent by weight of man-made fibres calculated on the total fibre content; and (iv) man-made filament (continuous) yarn that has not been processed to introduce crimps, coils, loops or curls along the length of the filaments, but does not include bulked yarn and stretch yarn. Explanation - II. "Textured Yarn" means yarn that has been processed to intro-duce crimps, coils, loops or curls alongthe length of the filaments and shallinclude bulked yarn and stretch yarn. Explanation - III. "Bass ....
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....tification. Thereafter, when the new item, viz. Item 68 (residuary entry) was introduced in the Act, it was contended by the Excise Authority that Nylon twine manufactured by the assessees was not covered by Item 18. According to the Revenue Nylon twine and Nylon yarn are two different items and Item 18 takes within its fold Nylon yarn only and not Nylon twine. The authorities claimed excise duty on "Nylon twine" under Item 68. The assessees paid such duty under protest. Thereafter, the application filed by the assessees for refund before the Assistant Collector failed. He passed an order to that effect on 28-5-1976. The appeal filed was rejected by Appellate Collector on 28-9-1976. Similarly the Central Government rejected the revision by order dated 31-10-1979. It is thereafter the assessees approached the High Court of Bombay for refund of the amount paid under protest. A Division Bench of the High Court heard and disposed of the petition by judgment and order dated 9-4-1980. Sujata Manohar, J. delivered the leading judgment and Masodkar, J., though for different reasoning, agreed with the conclusion of Sujata Manohar, J. 7.Sujata Manohar, J., after referring to the following....
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....e Nylon Twine is nothing but Nylon Yarn, other than textured yarn and referred to the Encyclopaedia Britannica, Vol. X (abridged version), and the literature issued by the Indian Standards Institution and others, the trade inquiries and the affidavits filed by persons in the particular trade, would conclusively show that Nylon Twine is considered as a kind of Nylon Yarn by the traders and persons dealing with the subject matter and the High Court had abundant material to substantiate the above proposition. 9.We do not think it is necessary, especially in this batch of cases, to refer in detail to the decisions cited by the Revenue or the text-books and the literature of the Indian Standards Institution and the Manual published by the Food and Agriculture Organization, United Nations, as to what is meant by "Twine", "yarn", "netting twine" etc. referred by the High Court. In this case, clinching evidence is afforded to demonstrate that trade and industry which deals with the goods, consider "Nylon Twine" as a kind of "Nylon Yarn". 10.There are innumerable decisions of this Court which have laid down the test or the principles to be borne in mind in construing the Items or Entr....
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....no difficulty in establishing that the article is the result of a process of manufacture; in the event of difficulty, it would be open to the Excise authorities to seek a direction requiring the assessees to set out in writing what it does to obtain the article. Too often, as our experience in this Court and in the High Courts, before the Tribunal was established, shows, lack of evidence has led to the failure of the case of the Excise authorities and, consequently, to the loss of revenue to the State. Failure to lay the requisite evidence cannot be made up by reference to authoritative publications unless the Excise authorities inform the assessees that they propose to rely upon the same before the adjudicating authority. .......Technical evidence and authoritative publications must, therefore, be placed in the first instance before the adjudicating authority and the Tribunal. They have the requisite Technical expertise to evaluate the same." (Emphasis supplied) 12.The law on the point as laid down by this Court (in various deci- sions) has been summarised in the book "Principles of Statutory Interpretation" (Sixth Edition - 1996) by Justice G.P. Singh, ....
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....derstand it normally. 14.In this case, apart from the meaning given to the words "Yarn", "Twine" etc., in the standard works referred to by the High Court, two items of evidence stand out prominent and clinch the issue. The first is, an order received by the assessee from the Director of Fisheries, Madras which goes to show that Nylon Twine is considered as a type of Nylon Yarn used for making fishing nets. The second is, two affidavits filed by the assessees before the authorities - one from the Managing Director of Maharashtra Rajya Machimar Sekhari Sangh Limited and another from a Partner of Maharashtra Fishing Material Company, wherein it is stated that "Twine" is a category of "Yarn". What is more - the assessees made available the above persons who have sworn to the affidavits for cross-examination at the time of the hearing of the applications, but the Revenue did not cross-examine them. The trade inquiry received by the assessees and also the affidavits conclusively point out that Nylon Twine is considered as a kind of "Nylon Yarn" in the particular trade by persons conversant with the subject-matter. The revenue has not let in any material to the contra. 15.In our vi....