1981 (7) TMI 75 - CGOVT - Central Excise

Summary

Issues:
1. Interpretation of the term 'yarn spun wholly out of glass fibre' for exemption from CV duty under Notification No. 87/76-C.E.
2. Whether glass filament yarn can be considered as 'yarn spun wholly out of glass fibre.'
3. Determining if the manufacturing process of glass yarn involving glass filaments qualifies as spinning.
4. Whether the impugned glass yarn meets the criteria of being spun wholly out of glass fibre under the exemption notification.

Detailed Analysis:
1. The revision applications challenged the rejection of exemption from CV duty for imported "Glass Yarn of Asahi Fibre" under item 22-F (1) as glass yarn. The petitioners argued that the lower authorities erred in limiting the exemption to spun yarn made from staple fibre, contending that 'spun yarn' includes both spun and filament yarn. They highlighted industry definitions and standards to support their claim that glass filament should be considered as glass fibre for exemption purposes.

2. The central issue was whether glass filament yarn could be deemed as 'yarn spun wholly out of glass fibre' under the exemption notification. The petitioners emphasized that the manufacturing process for both staple and continuous filaments of glass fibre involves spinning, as supported by a Glass Technologist's affidavit. They argued that the process of twisting glass strands into yarn is common for both types of glass fibre, making the impugned glass yarn eligible for the exemption.

3. The Government analyzed the definitions of 'fibre' and 'spinning' from industry standards, concluding that glass filament falls under the definition of glass fibre. They relied on expert opinions and technical publications to establish that the process of manufacturing glass yarn from glass filaments involves spinning, regardless of the type of glass fibre used. The Government determined that the impugned glass yarn, being made solely of glass filaments, qualifies for exemption under the notification.

4. Ultimately, the Government set aside the order-in-appeal and allowed the revision application, directing that the impugned glass yarn be exempted from CV duty in accordance with Notification No. 87/76-C.E. The decision was based on the understanding that the exemption applied to glass yarn spun wholly out of glass fibre, encompassing both staple fibre and continuous glass filaments in the manufacturing process.