9911796707
TMI Blog1994 (11) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned goods. The test was carried out by the Deputy Chief Chemist who reported the result of the analysis carried out by him in his letter dated 29-5-1989. The relevant extract is reproduced below :- "The sample is in the form of white single yarn with non-uniform thickness. It is composed of 76.2% (seventy six decimal two) or synthetic staple fibres (Polyester) and 23.8% (twenty three decimal eight) artificial staple fibres (Viscose)". 3. The appellants were not satisfied with the above test results and requested for re-testing of the sample by the Chief Chemist but their request was not accepted by the Additional Collector who adjudicated the proceedings. They have filed an appeal against that order before the Appellate Tribunal and in turn the Tribunal has remanded the matter on the ground that the principles of natural justice have been violated and directing decision afresh after re-testing the sample from higher authority. Accordingly, the Chief Chemist was requested to test the remnant sample which has been retained and was available in the laboratory and report results. The Chief Chemist examined the remnant sample and observed that the remnant sample was not eno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment was duly represented by Sh. M.K. Jain, learned SDR. 7. The main point to be considered in this appeal is whether the impugned goods (Blended Yarn) manufactured by the appellants would merit classification under sub-heading 5504.22 or sub-heading 5504.29. Sh. Hari Om Arora, Learned Advocate submitted that the Department was not just right in classifying the subject goods under sub-heading 5504.29 since re-test report of the duplicate sample reveals that average of polyester fibre was found to be less than 70% and therefore, the subject goods should have been classified under sub-heading 5504.22. Referring to the report dated 30-3-1992 in respect of remnant sample, he submitted that it was just 70% man made synthetic staple fibre it is appropriately classifiable under sub-heading 5504.22. Relying upon the decision of the Tribunal in the case of Oswal Wollen Mills v. Collector of Custom reported in 1990 (46) E.L.T. 495 he submitted that even if average of both reports is taken in a situation like this still it is less than 70% and accordingly, it cannot be classified under sub-heading 5504.29. He contended that Tariff Entry 5504 is applicable to yarn manufactured out of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e records. Without going into controversy whether the Chief Chemist was justified in asking the duplicate samples and recorded the desired analysis, we do not find any infirmity in the impugned order while deciding the issue of classification. We come across three test reports in the instant case and original test report was not discarded by the Tribunal but the order for re-test by the higher authority as it was rightly pointed out by the learned SDR. Accordingly the average of the three samples tested is taken into consideration the contents of the polyester staple fibres were more than 70% and accordingly the Department was justified in classifying the item under sub-heading 5504.29. We are also not convinced with the arguments advanced by the appellants' Counsel that yarn was manufactured out of waste in the absence of evidence material on record. But, as regards time barring issue we find some substance in the arguments advanced by the appellants' Counsel that since controversy was with reference to the percentage and composition of the various constituents it cannot be said that they have suppressed the facts with an intention to evade the payment of duty. We also find some v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... average could be taken but he wants average of only two of the reports to be taken into account, but that would not be appropriate once three reports are available to us which admittedly pertain to the goods in question. Therefore, the goods were rightly classifiable under Heading 5504.29. 14. This also goes to show that the appellants had misdeclared the composition at the time of filing the classification list and had wrongfully got the goods classified under a different sub-heading. 15. In the circumstances, therefore the extended period of time was available to the department under Proviso to Section 11A; hence, the demand was not time barred. The appellants were therefore required to pay differential duty at the correct rates applicable in accordance with the above classification. 16. The point of valuation although mentioned in the Appeal Memo was not pleaded or pressed during the course of hearing. 17. As regards the question of lots to which the goods were said to relate, I find that the officer has observed that the G. Ps. is do not show any lot number and similar is the case of the Test Memos and Test Reports. 18. On the other hand admittedly, sam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Counsel contended that had the usual tolerance been given, the percentage would be less which would not attract higher duty under sub-heading 5504.29 CETA. Ld. Counsel pleaded that the order proposed by the Hon'ble Member (Judicial) was proper. 24. Ld. S.D.R., Sh. M.K. Jain, supported the order proposed by the Hon'ble Vice-President and pointed out that there is no difference of opinion as regards the classification of the yarn under sub-heading 5504.29 CETA' 1985. The Test Reports of Departmenatal Laboratories alone are to be considered for classification and these reports, on an average, indicate composition percentage justifying classification of the yarn under sub-heading 5504.29 CETA' 1985. The Ld. S.D.R. urged that there has been misdeclaration of the yarn as to its composition justifying invoking the longer period for demanding duty under Section 11A Central Excises & Salt Act, 1944. 25. The submissions made by both the sides have been carefully considered. Both the Hon'ble Vice-President and the Hon'ble Member (Judicial) have agreed that the yarn is classifiable under sub-heading 5504.29 CETA' 1985. The scope of the reference to third Member is as to whethe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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