Central Excise Classification of Single, doubled Yarn, Multiple (folded) and Cabled Yarns whether Fancy or otherwise under Chapters 50 to 55 or 56 or 58 of the Central Excise Tariff - Regarding - Central Excise - 26/88-CX.1

Central Excise Classification of Single, doubled Yarn, Multiple (folded) and Cabled Yarns whether Fancy or otherwise under Chapters 50 to 55 or 56 or 58 of the Central Excise Tariff - Regarding Circular No. 26/88-CX.1 Dated 10-10-1988 [From F. No. 56/2/88-CX.1] Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Central Excise Classification of Single, doubled Yarn, Multiple (folded) and Cabled Yarns whether Fancy or otherwise under Chapters 50 to 55 or 56 or 58 of the Central Excise Tariff - Regarding A doubt has been raised regarding the correct classification of such Fancy Yarns which are merely single or doubled or multiple (folded) or Cabled yarns whether under Chapters 50 to 55 or in Chapter 56 as Special yarns or in Chapter 58. It is represented that textile yarns which are single or multiple (folded) including Cabled yarns fall only in Chapters 50 to 55 and not as Special Yarns in Chapter 56 of the Central Excise Tariff. In support of this argument reliance has been placed on the General Explanatory Notes in pages 707 and 708 of the HSN, according to which Textile Yarns may be single, multiple (folded) or cabled. HSN General Explanatory Notes on page 708 clarify the distinction between the yarns of Chapters 50 to 55 and the yarns and other such products of Chapters 56 and 58. It is further argued that the Explanatory Notes on page 778 of HSN confirm that certain Fancy Yarns and multiple (folded) and cabled yarns fall in Chapters 50 to 55. In view of this, it is argued that such Fancy Yarns as are single, doubled or multiple (folded) or cabled yarns fall in Chapters 50 to 55 depending on the predominance of the textile material and not as 'other special yarns' under Heading 56.06 of the Central Excise Tariff. 2. It is reported by the field formations that the confusion has been created in view of the instructions contained in Ministry's F. No. 56/3/87-CX.1, dated 26-4-1988 wherein the classification of Taspa Yarn is indicated as under Heading 56.06 and that the clarification in Ministry's letter F. No. 55/9/87-CX.1 dated 30-6-1987 relating to classification of fenaplast yarn under Chapter 55 and the guidelines therein were otherwise clear but for the clarifications relating to taspa yarn. 3. It is also reported by Collectors that according to Encyclopaedia of Textile Fabrics by the Editors of American Magazine, special yarns are like aluminium yarn, acid resistant yarn, glass fibre yarn, asbestos yarn etc. which are used for special kinds of fabrics. 4. The matter has been examined in the Board. In the circular letter F. No. 55/9/87-CX.1, dated 30-6-1987 , it is made clear that fenaplast yarn even though a fancy yarn is nothing but a doubled yarn and is classifiable in Chapter 55 of the Central Excise Tariff. In Board's Circular letter F. No. 56/3/87-CX.1, dated 26-4-1988 , it is clarified that taspa yarn is classifiable as a special yarn in Heading 56.06 and it was so clarified mainly on the consideration that taspa yarn consists of a core yarn. Thus if there is no core yarn, in a fancy yarn the instructions contained in F. No. 56/3/87-CX.1, dated 26-4-1988 would not be applicable. 5. The Deputy Chief Chemist who was consulted in this matter has opined that in view of HSN Explanatory Notes at page 707, single, multiple (folded) or cabled yarns may have loops or stubs at intervals, obviously meaning that these yarns would refer to such fancy yarns as well, other than gimped yarn, chenille yarn, loop wale yarn (which are specified in HSN heading 56.06). He has further opined that classifying all kinds of fancy yarns under Heading 56.06 becomes contentious. The Deputy Chief Chemist has also drawn attention to the HSN Explanatory Notes relating to Heading 56.06 whereunder it is reiterated that multiple (folded), cabled or fancy yarns would fall under Chapters 50 to 55. 6. The General Explanatory Notes on pages 705-708 of the HSN deal with yarns falling under Chapters 50 to 55. On page 707 of the HSN Explanatory Notes, the various types of yarns of these Chapters are discussed which is extracted hereunder :- "(B) Yarns. (1) General Textile yarns may be single, multiple (folded) or cabled. For the purposes of the Nomenclature : (i) Single yarns means yarns composed either of : (a) Staple fibres, usually held together by twist (spun yarns); or of (b) One filament (monofilament) of headings 54.02 to 54.05, or two or more filaments (multifilament) of heading 54.02 or 54.03, held together, with or without twist (continuous yarns). (ii) Multiple (folded) yarns means yarns formed from two or more single yarns, including those obtained from monofilaments of heading 54.04 or 54.05 (two fold, threefold, fourfold, etc. yarns) twisted together in one folding operation. However, yarns composed solely of monofilaments of heading 54.02 or 54.03, held together by twist, are not to be regarded as multiple (folded) yarns. The ply ("fold") of a multiple (folded) yarns means each of the single yarns with which it is formed. (hi) Cabled yarns means yarns formed from two or more yarns, at least one of which is multiple (folded), twisted together in one or more folding operations. The ply ("fold") of a cabled yarn means each of the single or multiple (folded) yarns with which it is formed. The above yarns are sometimes called multiple wound (assembled) yarns when they are obtained by juxtaposition of two or more single, multiple (folded) or cabled yarns. These are to be regarded as single, multiple (folded) or cabled yarns according to the type of the yarns of which they are composed. Single, multiple (folded) or cabled yarns may have loops or slubs at intervals (boucle or looped slub or flamme yarn). They may also be composed of two or more yarns one of which is folded back on itself at intervals to give the effect or a loop or swelling." 7. On page 708 of the HSN Explanatory Notes the distinction between single, multiple (folded) or cabled yarns of Chapters 50 to 55 and twine, cordage, rope or cables of Chapter 56 and braids of Chapter 58 is elaborately given. At page 778 of HSN Explanatory Notes, it is stated as under in respect of Heading 56.06, particularly with rerference to gimped yarns :- "These products are composed of a core, usually of one or more textile yarns, around which other yarn or yarns are wound spirally. Most requently the covering threads completely cover the core, but in some cases the turns of spiral are spaced; in the latter case, the product may have somewhat the appearance of certain multiple (folded), cabled or fancy yarns of Chapter 50 to 55, but may be distinguised from them by the characteristic of gimped yarn that the core does not itself undergo a twisting with the cover threads. 8. Thus it is obvious that multiple (folded) cabled or fancy yarns (except those of Chapter 56) fall under Chapters 50 to 55. 9. The HSN heading 56.06 includes gimped yarn, chenille yarn (including flock chenille yarn and loop wale yarn. On the other hand, Central Excise Tariff Heading 56.06 specifies "other special yarns including gimped yarn and strips, chenille yarn (including flock chenille yarn). Thus possibly, the other special yarns in the Central Excise Tariff heading 56.06 would include loop wale yarn. 10. According to the Standard Hand Book on Textiles, 8th Edition by A.J. HALL, doubling of yarns is described as under :- "Doubling yarn : All the operations so far described produce plain, uniform single yarns. As is well known use is 'made in the Textile ndustry of two or three fold yarns and also of fancy yarns with thick and thin paces. These are produced by twisting together the plain single yarns which have been made as described above. Thus for purposes of manufacture of fabrics and garments, the spinning and doubling section of the Textile Industry produces different kinds of yarns, thick and thin, plain and fancy, single and double and treble or more and of different types of fibres." 11. In view of the above, it is clarified that the instructions in Board's letter F. No. 56/3/87-CX.1, dated 26-4-1988 is applicable to such types of fancy yarns in which there is a core yarn and that the instructions contained in Board's F. No. 55/9/87-CX.1, dated 30-6-1987 are not sought to be modified by the letter dated 26-4-1988 and that both the instructions may be read separately. In view of the definitions of single yarn, multiple (folded) yarns and cabled yarns as given in the HSN Explanatory Notes relating to Chapters 50 to 55 and particularly in respect of yarns as given at pages 707 and 778 of the HSN Explanatory Notes, the single multiple (folded) and cabled yarns, whether plain or fancy, if they conform to the definitions of single multiple (folded) yarn and cabled yarns as discussed above, would be classifiable in Chapters 50 to 55 of the Central Excise Tariff depending upon the predominance of the textile materials and subject to the Section note of Section XI and the relevant Chapter notes of the Central Excise Tariff. 12. Field formations and trade interests may be informed suitably.