ORDER
G.A. Brahma Deva, Member (J)
1. This appeal arises out of and is directed against the Order-in-Appeal, dated 20-2-1997 passed by the Commissioner (Appeals), Customs and Central Excise, Ghaziabad.
2. The appellant M/s. Versatile Enterprises Pvt. Ltd., are engaged in processing of sliver knitted fabrics or yarn knitted fabrics consisting predominantly of acrylic fibres.
3. Arguing for the appellants, Shri K.L. Rekhi, learned Advocate, submits that process undertaken by the appellants are (i) back coating of the fabric with acrylic emulsion, (ii) shearing or cropping and (iii) electrifying polish. He submits that processes undertaken by the appellants are only temporary in nature, and, accordingly, the processing of grey fabrics and as such, they are not dutiable. He said that the issue involved in this case has been covered by the ratio of the decision of the Tribunal in Maharashtra Fur fabrics Ltd. v. Collector of Central Excise, reported in 1994 (71) E.L.T. 857 which has followed the decision of the Supreme Court in the case of Mafatlal Fine Spinning & Mfg. Co. Ltd. v. Collector of Central Excise, reported in 1989 (40) E.L.T. 218 (S.C.). In the case of Mafatlal Fine Spinning & Mfg. Co. Ltd. the Supreme Court held that fabrics continue to be unprocessed (grey) even after calendering and shearing. Calendering and shearing though finishing processes but not manufacturing processes. Following the same, the Tribunal has taken the similar view as can be seen from para 7 of the order in the case of Maharashtra Fur Fabrics Ltd. Para 7 is as under :-
“7 On consideration of all the facts, evidences and definitions from various dictionaries and going through the written submissions of both the sides as well as oral submissions, we are of the opinion that the present appellants do not carry out any processes after the fabric is manufactured. The processes carried out by appellants, namely, dyeing, coating, knitting, back coating, shearing, polishing etc., are integral processes for the manufacture of knitted fabrics. Chapter Heading 55.07 covers woven grey fabrics i.e. the fabrics which are complete and marketable and the fabric is saleable as it is. We have discussed above the scheme of Chapter 55. Initial headings of the Chapter relate to the products fibre and yarn which is not subjected to any processes. Grey fabric is subjected to further process which is subjected to finishing processes. Accordingly, we are of the view that the knitted fabrics obtained by the appellants are not subjected to any processes and hence are classifiable under Heading 55.07 and are eligible to the benefit of Notification No. 109/86-C.E., dated 27th February, 1986 as amended by Notification No. 3/88-C.E., dated 19th January, 1988. Accordingly, the appeal is allowed.”
In the aforesaid decision, it was clearly held that processes carried out by the party namely, dyeing, coating, knitting, back coating, shearing, polishing, etc., are integral processes for the manufacture of knitted fabrics.
4. Heard Shri Sangia, learned DR, for the Revenue.
5. We have carefully considered the submissions. We find that the issue involved in this case has been covered by the aforesaid decision as rightly pointed out by the learned Counsel. Since the issue involved herein has already been covered, following the same, we accept the contentions of the party and, accordingly, the appeal is allowed with consequential relief, if any.