ORDER
V.K. Agrawal, Member (T)
1. The issue involved in this appeal, filed by M/s. Threads (India) Ltd. is whether the impugned product manufactured by them is sewing thread.
2. Shri R.M. Sahai, learned Consultant, submitted that the Appellants manufacture sewing thread falling under Headings 54.02 and 55.04 of the Schedule to the Central Excise Tariff Act; that they claimed exemption in respect of doubled or multifold including cabled yarn put up on supports exceeding 1000 gms. in weight under Notification No. 26/94-C.E., dated 1-3-94 as amended by Notification No. 90/94; that the Asstt. Commissioner denied the exemption and confirmed the demand of duty; that on appeal the Commissioner (Appeals) rejected their appeal on the ground that the Appellants had increased the weight of the item by few grams over and above 1000 gms. whereas the other characteristics mentioned in Note 3 to Section XI of the Central Excise Tariff Act are satisfied; that according to the Commissioner (Appeals) the product in question was sewing thread, and therefore, the benefit of Notification was denied. The learned Consultant, further, submitted that as per Note 3 to Section XI ‘sewing thread’ means Multiple (folded) or cabled yarn :-
(a) Put up on supports (for example, Reels, Tubes) of a weight (including support) not exceeding 1000 grams; (b) Dressed for use as sewing thread; and (c) With a final 'Z' twist.
3. The learned Consultant contended that once the impugned goods were being bound on support weighing more than 1000 grams mere fact that the impugned product satisfy the condition No. (b) and (c) mentioned in Note 3 have no relevancy; that all the three conditions are to be satisfied before any product can be classified as sewing thread under Heading Nos. 52.04, 54.01 and 55.08.
4. Countering the arguments Shri U. Raja Ram, learned D.R., reiterated the findings as contained in the impugned Order and emphasized that the Appellants had increased the weight of the support by few grams with a view to avail the benefit of Notification No. 26/94 as amended. He also relied upon the decision in the case of CCE, Madras v. Systems and Components (P) Ltd., 2004 (165) E.L.T. 136 (S.C.) wherein it has been held that once it is an admitted position by the party itself that these are specified goods and the concerned party does not dispute that they have no independent use there is no need for the department to prove the same as it is a basic and settled law that what is admitted need not be proved.
5. We have considered the submissions of both the sides. Sewing thread for the purpose of Headings 52.04, 54.01 and 55.08 has been defined in Note 3 to Section XI of the Central Excise Tariff which has been extracted above. For classifying a product as sewing thread all the three requirements mentioned in Note 3 are to be satisfied and if any one of the requirement is not fulfilled, the said product cannot be treated as sewing thread for the purpose of specified headings of the Tariff. It has not been disputed by the Revenue that the yarn in question was put on support of a weight exceeding 1000 gms. and as such clause (a) of Note 3 is not fulfilled by the product in question before us. There is no material brought on record by the Revenue to allege that the Appellants had increased the weight of the item by few grams over and above 1000 gms. There is also no force in the finding of the lower authorities that they had not claimed that any basic characteristics of the item undergoes a change on increase of weight of item over and above 1000 gms., it does not alter the characteristics of the same. The legislature has provided the definition of sewing thread in the Central Excise Tariff Act which clearly provides that for being sewing thread multiple or cabled yarn is to be put on support of a weight not exceeding 1000 gms. The moment the weight increases over 1000 gms. the product cannot be classified as sewing thread under Heading Nos. 52.04, 54.01 and 55.08 in terms of Note 3 to Section XI of the Central Excise Tariff. We also observe that the Appellants had clearly mentioned in the process of manufacture given along with the classification list that the product is finally put up to support of a weight including support exceeding 1000 gms. Therefore, it cannot be claimed by the Revenue that the Appellants had admitted that the product manufactured by them is sewing thread and accordingly the ratio of the Supreme Court decision relied upon by the learned D.R. is not applicable to the facts of the present matter. We accordingly set aside the impugned order and allow the appeal with consequential relief, if any.