1998(05)LCX0147

IN THE CEGAT, COURT NO. IV, NEW DELHI

S/Shri S.S. Kang, Member (J) and V.K. Agarwal, Member (T)

SHREE RAJASTHAN SYNTEX LTD.

Versus

COLLECTOR OF CENTRAL EXCISE, JAIPUR

Final Order Nos. 417-418/98-D, dated 22-5-1998 in Appeal Nos. E/218-219/91-D

Advocated By : Shri Apurva Bhattacharya, Advocate, for the Appellant.

Shri A.K. Agarwal, SDR, for the Respondent.

[Order per : V.K. Agarwal, Member (T)]. - These are two appeals filed by M/s. Shree Rajasthan Syntex Ltd. involving a common question about classification of blended yarn whether it should be under sub-heading 5506.21 as claimed by the appellants or under sub-heading 5506.29 as classified by the Department.

2. Shri Apurva Bhattacharya, ld. Advocate, submitted that immediately after the search conducted by the Central Excise Officers, the sample of their product was tested in the appellants’ lab. only and they were found to be satisfied the conditions specified in Heading 5506.21 that is the proportion of the polyester staple fibre was more than 40% by weight of the total fibre content. The samples were sent to the Chemical Examiner who in his test report also reported that polyester fibre content was more than 40% by weight. However, the Chemical Examiner subsequently under letter dated 4-7-1988 informed the Department that the contents of polyester reported in the impugned matter was on dry basis as per the calculation method No. 1 of I.S. : 3416-1982; that since this method of calculation is not approved by the C.B.E.C. and as directed, he was amending the reports on the basis of regain basis. The samples were found to contain the polyester fibre less than 40% by weight. The ld. Advocate submitted that they had also sent some samples for chemical test by Northern India Textiles Research Association (NITRA), which has been notified by the Ministry of Textile under Notification dated 10-6-1988 for testing the yarn or cloth. According to the test report dated 18-11-1988, the composition of polyester was more than 40% by weight in each case. He further mentions that on enquiry from the Department about the reasons for changing the method of testing from dry mass to regain method, a copy of the Jaipur Collectorate’s Trade Notice No. 98/80 was given to the appellants. He submitted that this trade notice was issued for ascertaining the Deniers of filament yarn and as such this trade notice cannot be made applicable for determining the contents of the polyester staple fibre particularly when filament yarn is covered by Chapter 54 and the blended yarn in dispute falls under Chapter 55 of the Central Excise Tariff. He further mentions that the trade notice was about determination of `Deniers’ whereas the issue involved in this case is fibre content in blended yarn. He also mentions that as per IS specification 11195-1985 which prescribes the requirements of blend composition of textiles. The percentage of components has to be calculated on dry mass basis. Further, NITRA in their letter dated 9-1-1990 addressed to the appellants had observed that in the analysis of blend from yarn samples, the standard regain figure applicable to the material in fibrous form make the misleading results of resultant blends of individual components, as in yarn, several factors such as count, twist, twist factor, blend, type of various fibre component can ultimately affect the standard moisture regain figure and hence in testing of yarn, method based on dry mass basis should only be followed. Finally, he submitted that there was a request for cross-examination of the Chemical Examiner which was not accepted by the adjudicating authority. He therefore, prayed that taking into consideration the test report initially given by the Chemical Examiner and the test report of NITRA, ______ the percentage of polyester staple fibre is more than 40% by weight and hence the blended yarn manufactured by the appellants is classifiable under sub-heading No. 5506.21. The imposition of penalty is completely uncalled for in such case.

3. Shri A.K. Agarwal, ld. SDR relied completely on the findings given by the Addl. Collector, Central Excise in both the impugned orders. He mentions that the Addl. Collector, Central Excise did not allow the cross-examination of the Chemical Examiner as the method used by him for test had been intimated to the party. The adjudicating authority had also observed that the T.N. No. 98/80 was no doubt for determination of `Deniers’ but this itself implies that the determination of the blend of the yarn will be by the moisture of regain method. Ld. SDR also submitted that there is certain provision in Central Excise Rules requesting for retesting of the sample if the assessee is not satisfied with the test report; this procedure was not followed in the present case. He _______ therefore, contends that the test reports submitted by NITRA cannot be relied upon.

4. We have considered the submissions made by both sides. The blended yarn is classifiable under sub-heading No. 5506.21 if the proportion of the staple fibre is more than 40% by weight of the total fibre content. No doubt, the IS Specification has prescribed both the methods for determining the percentage by mass of polyester fibre that is the method based on dry mass and method based on dry mass with percentage additions for moisture. Ld. Advocate for the appellants has shown that the samples when tested by dry mass method were found to contain polyester staple fibre more than 40% by weight. Further, the NITRA, which is a recognised Association for testing the yarn, has opined that the testing of yarn should be done on the basis of dry mass basis as the regain figure may be affected by various reasons. Further another IS Specification 11195-1985 also shows in para 2.1.1 that the percentage of components shall be calculated on dry mass basis. In the light of these facts, it cannot be said that the percentage of the polyester staple fibre has only to be calculated by moisture regain method. It is not in dispute that when the Chemical Examiner tested the samples by dry mass method, the samples in question were found to contain polyester fibre content by more than 40% by weight. Even if the test report of NITRA is not taken into consideration, the fact remains that percentage of staple fibre is as per the Tariff Heading and that the classification of the blended yarn in question is under sub-heading 5506.21 of the Schedule to the Central Excise Tariff Act. In view of the above, the appeals are, therefore, allowed.

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Equivalent 1998 (102) ELT 715 (Tribunal)