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TMI Blog2003 (6) TMI 354X X X X Extracts X X X X X X X X Extracts X X X X ..... ey were also receiving yarn from other parties for carrying out such above processes. After processing, they cleared the yarn without payment of duty. They recovered job charges for the same, from the various parties. During the period March, 1994 to May, 1994, they had cleared cotton yarn after carrying out the process of dyeing and bleaching which they claimed to be exempted under Notification 46/86, dated 10-2-1986. They were issued six show cause notices for the period March, 1994 to March, 1995 for recovery of duty. The six show cause notices were kept pending die demanding the duty were thereafter taken up for hearing by the Assistant Commissioner. The appellants had preferred a refund claim of an amount of Rs. 3,87,486/- paid volunta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c., demands for differential duty were issued for the period from March, 94 to March, 95 (up to 15-3-95). During this period, duty was discharged on ad valorem basis (not specific as used to be prior to March, 94 paid at spindle stage on weight of yarn before sizing). By virtue of provisions of Rules 9 and 49 of CER, 1944, the clearance of yarn takes place in the form in which it is cleared and duty is payable at the time of clearance. Yarn cleared for carrying out the processing of bleaching, dyeing, etc., is also treated as clearance for captive consumption for manufacture of processed yarn. The yarn, in the instant case was subjected to the processes viz. bleaching, dyeing, etc., and hence the Central Excise duty should have been paid on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... After the processes bleaching, dyeing are carried out, a different commodity that is processed yarn emerges which is distinct from yarn and has a different name, character and use and is marketable. Thus, independently all the processes become process of manufacture even prior to 16-3-95 when such provisions were made explicit. This view is further fortified after careful scrutiny of Notification No. 46/86, dated 10-2-86 as amended which granted exemption to processed yarn (dyed/bleached) manufacturer out of duty paid yarn for independent processor, meaning thereby that processed yarn was excisable and dutiable. This legislative intent is quite clear. The plea of the appellant that processed yarn was not dutiable, if accepted would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case. I, therefore, hold that the process of bleaching and dyeing undertaken by the appellants on the duty paid yarn prior to 16-3-1995 did not amount to manufacture. Emphasis supplied and no appeal against this finding has been shown to be filed. (b) The above finding of the Commissioner (Appeals) on the process of bleaching and dyeing undertaken by the appellants has not been considered and or differentiated by the learned Commissioner (Appeals) in the order non-impugned. Therefore, the impugned order is required to be set aside and remitted back to Commissioner (Appeals) to re-determine the basic issue, of whether the process undertaken would amount to manufacture or not. Thereafter he should proceed to arrive at his fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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