TaxTMI 
TaxTMI 
2002 (3) TMI 67
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....f nylon yarn on job basis, i.e., it processes yarn of the other parties and is paid for the work done. For the said purpose, it receives nylon yarn from various parties. It twists/doubles nylon yarn on special machine where for the same does not undergo any physical or chemical changes, nor does it lose its original characteristics. According to the petitioner, twisted and doubled yarn continues to be known as yarn and is covered by TI 18(i)(a) of the first Schedule to the said Act. 3.Central Board of Excise and Customs (hereinafter referred to as 'the Board') issued notification bearing No. 24/77, which is in the following terms :- 'TARIFF ADVICE NO. 24/77 F.No. 50/4/77-CX.2 Government of India CENTRAL BOARD OF EXCISE AND CU....
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....; All Appellate Collectors of Central Excise.2. ……………………………………………….' 4.Subsequent to the aforesaid notification, the Excise Authorities initiated proceedings against the petitioner for recovery of excise duty whereupon the petitioner informed the Assistant Collector, Central Excise vide its letter dated 26-2-1981 that it intends to process fish net yarn at its factory at Ahemdabad and does not agree with their view for making payment of excise duty @ 8%. However, the said duty was paid under protest. 5.The petitioner vide letter dated 28-2-1981 again informed the Assistant Collector, Central Excise that nylon yarn for processing to manufacture fi....
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....lon yarn, as the same falls under T.I. No. 68 and the application for licence under T.I. No. 18 was accordingly returned and the petitioner was requested to file classification list of the product under T.I. No. 68. 10.Pursuant to and in furtherance of the aforesaid directions, the petitioner once again represented his case vide letter 20-4-1981, which is in the following terms:- "INDIAN ELECTRO CHEMICAL LIMITED, AHMEDABAD Ref. No. F-(45)/2809 The Superintendent of Central Excise, Assessment Range II, Division II, Ahmedabad Dear Sir, Re: Request for a Licence u/s 18-Fish Net Twine. We are in receipt of your letter No. CE/VII/61, dated 6th April, 1981, even though, we have given detailed reasons in support of our c....
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....notification is a legislative function. 13.If any guideline is issued by way of administrative instructions or if a decision is taken, as has been taken, the same must fulfil the legal obligations. The concurrence of Collectors of Central Excise (in short, the Collectors) cannot override the legislation as insertion of any item in the Schedule must be done by way of legislation. The same cannot be done evidently in terms of executive instructions. 14.The question as to whether processing, twisting or doubling of nylon/polyster yarn amounts to manufacture of a new product came up for consideration in Union of India v. Delhi Cloth & General Mills Ltd. [1977 (1) E.L.T. J 199 (SC) = AIR 1963 SC 791]. In that decision, the Apex Court has c....
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....orementioned decision has been affirmed by the Apex Court, in Union of India v. Garware Nylons Ltd. - 1996 (87) E.L.T. 12 (S.C.), in the following terms :- In'15. our view, the conclusion reached by the High Court is fully in accord with the decisions of this Court and the same is justified in law. The burden of proof is on the taxing authorities to show that the particular case or item in question is taxable in the manner claimed by them. Mere assertion in that regard is of no avail. It has been held by this Court that there should be material to enter appropriate finding in that regard and the material may be either oral or documentary. It is for the taxing authority to lay evidence in that behalf even before the first adjudicating aut....
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....2 (S.C.)] in support of his contention that the respondent was liable to pay duty on the doubled yarn and no duty ought to be levied on the single yarn. In our opinion this judgment can be of little assistance to the respondents." In'10. Bhilwara Spinners case the company was engaged in the manufacture of fabrics. For that purpose it manufactured four types of yarns. The yarn when produced was a single yarn but the appellant doubled and multi-folded the yarn as a step towards manufacture of fabrics. The appellant's case was that it had been paying duty on doubled or multi-folded yarn but not on single yarn. When called upon by the Excise Department to show cause why duty should not be levied on the single yarn, the contention of the appe....