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Issues Involved:
1. Definition of the term 'hank' in relation to cotton yarn. 2. Whether notification dated 16th February 1963 (Annexure 'B') is a clarification or an amendment with retrospective effect. Detailed Analysis: Issue 1: Definition of the term 'hank' in relation to cotton yarn The petitioners argued that the term 'hank' was understood to mean yarn irrespective of its length on a particular hank or the type of reel. They contended that prior to the notification dated 16th February 1963 (Annexure 'B'), there was no specific length assigned to the term 'hank' in any notification, and thus, yarn in hanks was cleared without imposition of excise duty if it was less than 17 counts. The petitioners further argued that the term 'hank' did not embrace any measure of length, and the executive instructions issued in October 1962, which assigned a length of 768 meters to the term 'hank', were unjust. The department countered this by stating that the term 'hank' in relation to cotton yarn has always meant a reeled length of 840 yards (768 meters). They supported their argument by citing various dictionaries and technical manuals which defined 'hank' as a coil or skein of 840 yards. The department maintained that this definition was well understood in the textile industry and had attained the significance of a term of art due to long usage. The court found considerable force in the department's contention, noting that the petitioners themselves had admitted in their gate passes that the normal length of a hank was 840 yards. The court referred to various dictionaries and technical manuals which consistently defined 'hank' as a reeled length of 840 yards. Thus, the court concluded that the term 'hank' as understood in the textile trade and industry, as well as in ordinary parlance, means a hank which does not contain more than 768 meters or 840 yards. Issue 2: Whether notification dated 16th February 1963 (Annexure 'B') is a clarification or an amendment with retrospective effect The petitioners contended that the notification dated 16th February 1963 (Annexure 'B') was an amendment to the earlier notification dated 15th September 1962 (Annexure 'A') and could not be given retrospective effect. They argued that since the term 'hank' was not defined in the earlier notification, the subsequent notification which defined 'hank' as not containing more than 768 meters of yarn was an amendment and not a clarification. The department argued that the notification dated 16th February 1963 (Annexure 'B') was merely a clarification to make explicit the meaning commonly assigned to the term 'hank' in the textile industry. They asserted that the term 'hank' had always been understood to mean a reeled length of 768 meters, and the notification did not impose any new duty but simply clarified the existing understanding. The court agreed with the department's argument, stating that the term 'hank' was fairly understood in the commercial community and the textile industry to mean a reeled length of 768 meters. The court noted that the petitioners themselves had represented to the Central Board of Excise and Customs that the term 'hank' was never defined in any of the notifications. The court concluded that the notification dated 16th February 1963 (Annexure 'B') was issued to remove any doubt about the meaning of the term 'hank' and did not purport to impose any duty with retrospective effect. Therefore, the court held that the notification was a clarification and not an amendment. Conclusion: The court dismissed the writ petition with costs, holding that the term 'hank' means a reeled length of 768 meters (840 yards) and that the notification dated 16th February 1963 (Annexure 'B') was a clarification and not an amendment with retrospective effect.
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