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TMI Blog1997 (12) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... ings for the purpose including 52.04 were also shown both for the input items as well as the finished product. After the issue of this notification, a demand was raised as it was felt by the authorities that the subsequent Notification 17/94, clearly showed that the sewing thread was not covered in the description of yarn at Sl. No. 13 of Notification 17/94 as the words including sewing thread were missing from the description of the goods entered in the notification. 2. The learned Advocate for the appellants has pleaded that sewing thread is also a variety of yarn and, therefore, a subsequent entry at Sl. No. 17 which covered yarn including sewing thread would make no difference so far as the claim of the appellants to the benefit of Notification 7/94 is concerned. The learned Advocate has pleaded that the Tariff Entry 54.04 at the relevant time covered yarn (including sewing thread). He has pleaded that since the term yarn also included sewing thread within its ambit for the purpose of the Tariff, the description yarn in the notification should be taken to be covering the sewing thread also for the purpose of the benefit of the notification. In this connection, he has cited th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd sewing thread are one and the same commodity. Coming to the decision of this Court in Madura Mills Company Ltd. v. Government of Madras [1970] 25 STC 407, a Division Bench of this Court which was concerned with the issue as to what is the nature and character of cotton tyre cord warp manufactured by the assessee concerned, ultimately held that the product continues to be cotton yarn. In the decision reported in Muthusavari Pillai Sons v. State of Tamil Nadu [1977] 39 STC 359 (Mad.), again another Division Bench of this Court, which was concerned with the issue as to whether cotton bandings and cotton ropes sold by the assessee concerned fall within the definition of textiles or cottton yarn , held that yarn does not lose its character as yarn merely by reason of its consisting of a bunch of threads, as in the case of doubling and twisting together of two or more threads to make a stronger or firmer thread in order to manufacture a specified kind of textile. The learned Judges held that a bunch of spun thread could also come within the definition of cotton yarn if it can be used for the manufacture of any textile. In the other decision reported in State of Tamil Nadu v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treated with solid or semi-solid, waxy materials to secure a smooth, compact strand which is quite flexible, but which presents no loose fibers. The yarn is usually plied. A three-cord thread is one that is made from three yarns twisted together, six-cord is made by twisting six yarns together, and so on. Sewing threads are numbered by various systems for size : in one system, number 40 is fairly coarse and would be suitable for sewing slip covers and drapery fabrics; number 60 is finer than 40 and would be used on percale or gingham. The higher the number, the finer the sewing thread. From this, it is clear that sewing thread is a variety of yarn. Now the term yarn is applied to a variety of products which may comprise of monofilaments or which may be formed out of staple fibres or by combining a numbr of yarns by either twisting or otherwise. Thread also, it is seen, is formed out of fibres and which is treated with solids or semi-solid materials to secure and the yarn is used for forming the thread only. When this is the position technically, the question is, whether for the purpose of Tariff, yarn and thread should be treated differentially. 5. We observe, the term yarn is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stances, where a particular item was specified in the notification later on, the description of the same was omitted from the notification, it was subsequently again included, the Tribunal has held, since the term cold rolled bars, the category to which the CTT bars belong, where the subject matter of the notification, the omission of the description CTT bars for a short period from the notification would make no difference as the term cold drawn bars covered the CTT bars also and the notification issued subsequently should be taken to be clarificatory in nature for the benefit of the notification for the past period when this description was not figuring in the notification. In that case the Tribunal has held as under : Whether the Notification No. 202/88, dated 20-5-1988 covered the goods in question? Whether the Notification No. 170/89 is a clarificatory in nature having retrospective effect? Our findings on these questions are in favour of the appellants and against the Revenue. The Notifications earlier to Notification No. 202/88-C.E. and subsequent to this notification, granted the benefit to twisted bars. The legislative intent to grant benefit is also indicated from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the notification has incorporated the tariff heading in toto then the definitions should also be applied. In these cases, we notice that the notification is a comprehensive one, which does not apply merely to the description of the goods appearing in Heading 72.14, but to other goods as well. The Revenue s stand is that the definition of other bars and rods , as appearing in Chapter Note (m) of Chapter 72 cannot be applied, while interpreting the notification, as it is argued that the twisted bars referred in the definition occurring in Note (m) should have a uniform solid cross-section along their whole length in the shape of circles, oracles, rectangles (including squares), triangles or other convex polygons. Hence, the twisted bars referred in the definition cannot be linked with CTD Bars, as it does not have a uniform solid corss-section in the shape of circle, rectangular, square or triangle, as defined, and also it does not satisfy the ISI Glossary of terms. To this proposition, the HSN Explanatory Note at page 1001 is also relied. If this argument is accepted, then what follows is, that the term not further worked appearing in the notification refers to those types ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been made explicit, and these words are clarificatory in nature. The learned SDR stated that as these words had been incorporated after the words hot rolled, hot drawn or hot extruded , and not after the words cold rolled or cold finished , therefore, it is indicative of these goods having occurred from the process of hot rolled only and not cold formed. It is difficult to appreciate this proposition. The reason being that if such an understanding is placed then it would mean that twisted bars have arisen out of hot rolled bars and then it would support the appellant s contention that the twisting is only a completion of hot rolled process. In any case, we do not wish to dwell much on this point in the absence of technical literature but suffice to say that the facts and circumstances of the case and in the light of legislative intention, it is clear that these goods were intended to be exempted from payment of duty. Further, contention of the DRs is that the Notification is required to be strictly construed. In this regard, we observe that it is not flowing from the facts of this particular case. We have noted that the Notification No. 202/88, on its plain reading applies to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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