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TMI Blog2022 (2) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... he duty. The appellant had been classifying their yarns as Filament Yarn or partially Oriented Yarn (POY) and were getting such yarn assessed on the basis of the denierage of the Filament Yarn or the POY, as the case may be. The appellant filed a classification list no.Yarn/37/83-84 dated 22.03.84 seeking approval of rate of duty of man-made non-cellulosic, other than textured filament yarn falling under T.I.18-II(1)(A) of the Central Excise Tariff, as it existed at the relevant time, declaring the products and rate of duty as under:- Sl.No. Continuous Sl.No. of the Classification list Description of the Product Rate of Duty Notification No. 1. 153 Polyester Yarn 756 denierage Rs. 15/-per kg. (basic) + 10% SED of BED + 15% AED of BED 49/83 dt.1.3.83 as amended by Notif.No.261/83 dt.11.10.83 and 181/83 2. 154 Nylon Filament Yarn 148/10/0/902 Rs. 41/-per Kg.(Basic)+10% SED of BED + 15% AED of BED 49/83 dt.1.3.83 as amended by Notif.No.181/83 dt.1.7.83 & 261/83. 3. 155 374/24/0/902 Rs. 6.50 /- per kg. (basic) + 10% SED of BED + 15% AED of BED -do- 3. The classification list of the appellant as aforesaid, indicated that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice dated 01.09.1984 was decided by the Assistant Collector, Division-I, Central Excise, Ghaziabad vide Order-in-Original dated 19.07.1985, rejecting the claim of the appellant. The order-in-original dated 19.07.1985 was challenged by the appellant before Hon'ble Delhi High Court vide C.W.No.2205 of 1985. The Hon'ble High Court of Delhi vide order dated 23.09.1985 quashed the said order dated 19.07.1985 and remanded the matter to the Assistant Collector for fresh adjudication in accordance with the law, after giving opportunity to the appellant of cross examining the Chemical Examiner, after production of the relevant records, if available, and referred to at item No.1 and 2 of the appellant's letter of 20.04.1985. 6. As directed by the Hon'ble High Court of Delhi vide order dated 23.09.1985, the case was re-adjudicated by the Adjudicating Authority vide the order dated 22.04.87 confirming that the product referred to in classification list No.Yarn/37/83-84 was neither classifiable as Polyester/Nylone Filament Yarn as described by the appellant in the said classification list, nor as partially oriented yarn (POY), quashed the provisional assessment granted vide letter C.No.V-18( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble High Court, that the impugned order dated 22.04.1987 is appealable before the CESTAT. On their request Hon'ble Court also granted liberty to the appellant to move an application under Section 14 of the Limitation Act, 1963 before the Tribunal within six weeks. The order was further modified by Hon'ble High Court on 13.12.2011 extending the time of filing appeal by 15 days. Thereupon, the appellant filed appeal before the CESTAT, New Delhi. During the hearing appellant made submission that due to inadvertence the appeal has been filed before the Tribunal, whereas it is maintainable before the Commissioner (Appeals). This Tribunal vide Final Order No.A/734/2012-EX(DB) & S.O. No.975/12 & M.O. No.736/2012 dated 25.06.2012, dismissed the appeal as well as Misc. Application as withdrawn with liberty to appellant to file appeal before Commissioner (Appeals) within two weeks. 10. In view of the CESTAT order dated 25.06.2012, the appellant filed appeal bearing No.117-CE/APPL/GZB/2012 dated 5.7.2012 before Commissioner (Appeals), Central Excise, Ghaziabad, seeking condonation of delay under Section 14 of the Limitation Act, 1963, along with application for stay of the impugned order dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Like POY, it is stated to be used in the manufacture of textured yarn and is also not suitable for knitting, weaving and rope making." 15. Thus, the test report clearly states that not only the denier of sample is similar to that declared in the classification list, but also the fact that the samples are not fully drawn like FOY (Fully Oriented Yarn), and are not suitable for knitting, weaving and rope making like POY. The fact that POY can be of different qualities has been acknowledged by the Board in its Circular No.6/MMF/90-C.X.1 dated 20.02.1990, wherein in paragraph-1, it has been stated that POY of 86 deniers is textured into 50 denier and other qualities of POY of 150 denier is textured to 75 deniers. He further urges that yarns manufactured could be UDY (undrawn yarn), POY (Partially Oriented Yarn) and FDY (fully drawn yarn), depending upon the winder speed and heat setting methods. 16. Further, urges that stretchability of samples was greater in comparison to POY Samples earlier analysed, makes no difference, inasmuch as stretch -ability of POY is dependent on the degree to which it has been stretched (as admitted in para 23 of Order-in-Original).Different qualities of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e POY; (iii) POY can be of different quality /variety depending upon the degree of their stretchability. Stretchability being directly linked with denier, POY of different denier are available, one of which was the product in question. 20. It is further urged that the finding recorded by the ld. Commissioner (Appeals) that Rs. 1.25 crores deposited by appellant vide Challan No.148/1 dated 6.10.1986 cannot be treated as deposited against the instant demand, is also perverse and incorrect, inasmuch as it overlooks the fact that prior to the said deposit, litigation regarding the classification of products in C/L No.37/83-84 was going on with the department, and on two occasions the issue was decided against the appellant and in these circumstances, appellant choose to deposit the amount of Rs. 1.25 crores in respect of pending cases, which is also clear from the contents of letter dated 6.10.1986 (reproduced in paragraph 5.4 of Order-in-Appeal). 21. Accordingly, ld. Counsel prays for allowing their appeal with consequential benefits in accordance with law. 22. Ld. Authorised Representative for the Department/Revenue reiterates the findings in the impugned order. 23. Having cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to that rate of CVD as was provided for in respect of 115 deniers. The rate was, as the petitioners, rightly contended Rs. 61.25 per kg. The court further observed that if excise duty upon texturising is leviable, it must be levied by the Excise Authorities. 4. The said issue was again referred to the Law Ministry for their opinion in F.No.357/21/83-TRU. The Law Ministry has viewed as follows:- "The point for consideration is whether it is possible to charge excise duty on partially oriented yarn (POY) on the basis of its ultimate denier. It appears that POY used to be imported earlier and the importers were paying the lower rate of duty at the higher denierage stage. In the case of such imported POY, countervailing duty was charged on the basis of the ultimate denier of the resultant textured yarn. The point for consideration is not regarding countervailing duty payable on imported POY. The question for consideration relates to indigenously produced POY. It has been mentioned in the referring note that under the Central Excise Law, duty is leviable on goods manufactured in a factory at the time of its removal, whether for captive consumption or for clearance outside. In vie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esultant textured yarn would be leviable to duty separately unless exempted, like under notification no.178/83-CE, irrespective of the fact that the denierage of the resultant textured yarn is less than the POY. 8. Ministry's earlier Circular No.YARN/2/80, dated 24.09.1980, in this regard is modified accordingly. Pending cases may be finalised accordingly." 24. Thus, we find that the findings in the impugned order, which are apparently based with reference to the earlier Circular No.YRN/2/80 dated 24.09.1980, which has been subsequently clarified by the aforementioned Circular dated 20.02.1990, clarifying that the partially POY/polyester yarn/nylon filament yarn, are dutiable at the appropriate rate of duty as per Notification No.49/83-CE dated 1.3.83 read with amending notification no.181/83-CE and 261/83-CE. Once the duty is held to be chargeable on the yarn as per classification list no.Yarn(intermediate product)/37/83-84, the duty on the final product viz. Polyester/Nylon textured yarn is nil as provided in notification no.178/83-CE dated 1.7.1983. 25. We further find that as per test report with regard to the samples of classification list no.Yarn/37/83-84, it has been r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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