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TMI Blog1998 (5) TMI 383X X X X Extracts X X X X X X X X Extracts X X X X ..... 504.22, since the mill neps are not the same as artificial staple fibre or polyester staple fibre and they are in the capacity of other textile material, the blended yarn in question is to be classified under sub-headings 5504.29 and 5506.29 as the case may be and not according to the pre-dominance of the fibres and because other textile material has been used. The chemical examiner in his report has clearly specified that brown coloured fibres are introduced at irregular interval giving special effect to the yarn. Thus in fact although the yarn contains fibres but in addition they also contain other textile material, since the mill neps contain fibres in intangled mass, which are not being spun as yarn but come at irregular interval in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, allow the assessee to redeem the goods on payment of redemption fine of Rs. 50,000/- (Rupees Fifty Thousand). For the various contraventions of the Central Excises and Salt Act, 1944 and the Rules thereunder, I impose a penalty of Rs. 1,00,000/- (Rs. one lakh only) under Rule 173Q of the Central Excise Rules, 1944. 2. Being aggrieved by this order, the appellants have filed the captioned appeal before us. 3. Briefly stated the facts of the case are that the appellants are engaged in the manufacture of blended yarn and cleared it under sub-headings 5504.22 and 5506.21. The department alleged that since the yarn contained mill nep which was the other textile material, therefore, the yarn manufactured by them would be classifiable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t essentially means of which it is made of; that the neps have to be treated as viscose or polyester fibres as the case may be: that they are not any other textile material; that the test report did not mention that the sample contained mill neps; that the yarn manufactured by them has correctly been classified and claimed under Chapter sub-headings 5506.21 and 5506.22. 6. It was also argued by them that they were maintaining lot-wise register for mixing of fibres for blended yarn when the Central Excise Officers visited their factory; that they never pointed out about the excisability of neps or different classification of neps; that the demand prior to 18-12-1989 is wholly barred by time under Section 11A as there was no deliberate inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proof to show that the excise officer on their visit to the factory examined their private records relating to neps. They have referred to judgments which are not relevant to their case. Non-declaration about manufacture of mill neps and blending of mill nep in the nep yarns and not declaring the appropriate blend amounts to wilful suppression of facts and larger period of 5 years become applicable in their case. 7. Shri K.K. Anand, ld. Advocate, appearing for the appellants reiterated the submissions made before the lower authorities. In addition to that, he specifically referred to the decision of this Tribunal in the case of Super Syncotex (India) Limited [1996 (87) E.L.T. 56]. He submitted that an identical issue came up before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is mill nep which is admittedly an artificial staple fibre on being mixed with polyester and artificial fibre would go out of the Tariff sub-heading 5206.21 which reads:- Containing artificial staple fibre and polyester staple fibre (not containing any other textile material), and in which the proportion of polyester staple fibre is more than 40% by weight of the total fibre content. It is the contention of the Revenue that by mixing the mill neps along with other two items artificial and polyester fibre, the item which comes out in the form in which it is removed from the factory would not be covered by sub-heading 5206.21 as mill nep is a textile material and it is excluded from the said sub-heading. In our opinion mill nep which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th (floch) and textile dust . Category (C) refers to Mill neps . Therefore, mill neps have been separately categorised and not placed along with the category of wadding of textile materials and articles thereof as well as textile fibres. Therefore, on a reading of these materials, it is clear that mill nep cannot be considered as a textile material. It continues to remain as an artificial staple fibre. In combination with artificial and polyester staple fibres, it continues to fall within the sub-heading 5606.21 and hence the contention of the appellants is required to be accepted. In the case of Indian Rayon and Industries Ltd. (supra) the Tribunal held that it is well settled that the terms used in the tariff have to be given their ..... X X X X Extracts X X X X X X X X Extracts X X X X
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