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CASE NO.: Appeal (civil)  1081 of 1998

PETITIONER: Commissioner of Central Excise, Ahmedabad

RESPONDENT: M/s Susma Textile Pvt. Ltd.

DATE OF JUDGMENT: 05/05/2004

BENCH: CJI & G.P. MATHUR

JUDGMENT: JUDGMENT

(With C.A. Nos. 8559/1997, 1052/1998, 5010/1998,  3649/1999, 3707/1999, 4223/1999, 5557/2001,  6976/2001 and 8973/2003)

RAJENDRA BABU, CJI :

       The question that falls for consideration in this  batch of cases is as to the classification of the  bleached sheeting which is heavily sized and  manufactured by each of the respondents and  whether the same falls under Heading 52.06 of the  Central Excise Tariff Act, 1985 [for short ’the Act’] or  under Heading 59.01 as sought by them.   

The respondents are engaged in the  manufacture of cotton fabrics which is stiff and  heavily sized with starch gum and inorganic fillers.   The respondents classified this product under  Heading 52.06 by declaring their product as  subjected to the process of bleaching and finishing.   However, later on, when the Department inspected  the unit of the respondents, they thought that the  product in question will have to be classified under  Heading 59.01.  Sample of the product was taken for  testing and the report thereto is that the sample is in  the form of open weave cotton fabrics heavily sized  and stiff with starch gum and inorganic fillers on  treatment with hot water the fabrics looses all its  stiffness.  On this material, a show cause notice was  issued to the respondents demanding differential  duty for different periods.  The Assistant  Commissioner, Central Excise, by his order made on  16.8.1989, dropped the demand raised in the show  cause notice by holding that the said cotton fabrics  were correctly classifiable under Heading 52.06 and  approved two classification lists accordingly.   

The matter was carried in appeal to the  Collector [Appeals] who allowed the appeal and  affirmed the demand of duty by holding that the  product in question is specifically covered under  Heading 59.01which provides a specific tariff entry  for stiffness textile fabrics.  The matter was further  carried to CEGAT.  The Tribunal held that the cotton  fabrics though heavily sized do not have permanent  stiffness to be treated as similar to ’Buckram’ and

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accordingly classifiable under Heading 52.06 and not  under Heading 59.01 of the Act.  Hence these  appeals.

We may, however, notice that in Collector of  Central Excise, Aurangabad vs. Solapur Zilla  Vinkar Sahakari Federation., 1998 (104) ELT 402,  the tribunal held that stiffened fabrics generally used  in the interior of garments having been processed  into bleached and grey sheeting by applying topioca  starch, maize starch, french chalk power and  delomits which render the fabrics stiffening effect,  are classifiable under Heading 52.06 of the Act and  not under Heading 59.01 thereof.  The matter was  carried in appeal to this Court in Civil Appeal  No.3965 of 1998 and this Court, on 22.2.1999,  dismissed the same, both on the ground of delay and  on merits.   

The Revenue contended:

1.      that specific description of Heading 59.01,  viz., textile fabrics coated with gum of  amylaceous substances of a kind used for  the outer cover of book or the like is satisfied  in this case; 2.      Explanatory Note to HSN made it clear that  not only cloth, plain weave woven fabrics,  usually of cotton, linen or man-made heavily  coated with gum or amylaceous substances  which is used for book binding, but also such  cloth with other end-uses, would get cover  under this heading.

The tribunal held that the Board by their  instructions issued on 2.9.1988 had clarified that for  classifying such products under Heading 59.03, the  textile fabrics should have a continuous and adherent  films or layer on one side of the fabric surface and  the fabric should be impervious and should satisfy  the conditions prescribed in Note 2 of Chapter 59.   They also adverted to letter issued by the Ministry of  Finance, Department of Revenue dated 7.12.1989  wherein it had been confirmed that bleached and  sized cotton fabrics manufactured by them merit  classification under Chapter 52 as these fabrics were  neither coated nor impregnated but only sized with  starch.  On behalf of the Revenue, the contention put  forth before the tribunal is that the scope of  expression ’Buckram and similar stiffened textile  fabrics’ could not be restricted by reference to first  half of the heading relating to coating and should be  interpreted in its ordinary manner and that if the  stiffened fabrics is similar to Buckram, tracing cloth,  book binding cloth, etc., it would be appropriately  regarded as stiffened fabrics covered by sub-heading  5901 since the general heading of processed fabrics  falling under sub-heading 5206.  Further, the book  binding cloth would be covered by the expression  ’Buckram’ and similar textile fabrics of sub-heading  5901.  Several text books and dictionaries were also  referred before the tribunal.  All the contentions  advanced on behalf of the Revenue were refuted by  the learned counsel appearing for the assessees and  elaborate arguments were submitted before the

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tribunal that the product in question is not a  ’Buckram’ or something akin to ’Buckram’ inasmuch  as ’Buckram’ referred to permanently stiffened fabric  and once the interstics of cotton fabrics were filled  and treated with gum, then alone it would come  under Chapter 59 and in the present cases the item  is porous padded and the interstics are not filled and,  therefore, the product cannot go under Chapter 59 at  all.  The tribunal noticed firstly as to the  maintainability of the appeal and thereafter on merits  of the matter.  The tribunal proceeded on the basis  that the burden of classification is on the Department  and no evidence had been placed by the Department  to show that the product is a ’Buckram’ and it  requires to be classified under Chapter 59 and  Explanatory Note IV to Heading 59.01 indicates that  ’Buckram’ and similar stiffened textile fabric of a kind  used for that foundations would fall under this  heading.  There is also an indication that certain  varieties of ’Buckram’ and are similar fabrics made  by pasting together to such stiffened fabrics and  used mainly in the manufacture of hat foundations of  Heading 65.07 would also be fall under this heading  and that the textile fabrics coated with gum and  amylaceous substances of a kind used for paper  coverings of books or the like, tracing cloth, prepared  binding ’Buckram’ and similar stiffened textile fabric  of a kind used for hat foundation would be covered  under this heading.  After adverting to certain  definitions in the Dictionary of Textiles held that an  impregnated fabric is one in which interstics between  the yarn are to be completely filled with  impregnating compound throughout the thickness of  the material.  The definition of ’Buckram’ and Library  Buckram also indicates that it is heavily sized.  The  definition of sizing indicates that it is a generic term  for compounds when applied to yarn or fabric form a  more or less continuous solid film around the yarn  and individual fibres.  The chemical examiner in his  report had stated that each of the eight samples are  in the form of open woven bleached cotton fabrics  sized with starch and each is somewhat showdy.  On  treatment with hot water, each looses of stiffness.   The interstics between the yearn were not closed.   The overall count is less than 51 as determined on  the basis of yarns taken out from the fabrics in each  case.  Therefore, the test result indicates that the  interstics are not filled in these cases and there is no  permanent stiffness.  The requirement of heading 59  clearly shows that the textile fabric has to be  stiffened and the definitions which are relied by the  Revenue indicates that the sizing have to be heavy  and the interstics have to be filled and the stiffness  has to be permanent; that the test results do not  support the department’s case and also there is no  specific finding that the material is a ’Buckram’.   They also adverted to the tariff advice No. 36.84  dated 27.7.1984 issued to all the Collectors  indicating that the object of exemption is to cover  such fabrics which are treated only to achieve a  temporary effect of sizing [stiffening] and gloss and  addition of wetting agents, optical whitener, fatty  matter and fillers are meant only to help padding  process so as to give a temporary brightness to sized  fabrics, to soften the starchy film left on the fabric

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and to give a better and fuller appearance.  However,  these additives get removed from the fabric when  the starch is washed up.  Based on this material, the  appeal filed before the tribunal was rejected.

The learned counsel for the appellants  contended that the tribunal has gone on the basis of  issue of permanent stiffness and not dealt with other  aspect whether the fabric in question is heavily sized  or not.

Heading 59.01 reads as follows: "Textile fabrics coated with gum or  amylaceous substances, of a kind used for  the outer covers of books or the like;  tracing cloth; prepared painting canvas;  buckram and similar stiffened textile  fabrics."

In Fairchild’s Dictionary of Textiles, which is an  authority to the text book on the matter, sets out  what ’Buckram’ means :

"A plain weave, coarse, open fabric heavily  sized and used principally as stiffener which  is placed between the lining and surface  cloth of the garment to give it shape or  form.  Also used for hat shapes, book  binding, etc. Made with cotton, linen,  hemp, hair etc.  Also made by gluing two  openweave, sized cotton fabrics together.   Usually white or plain collors.  Also see  Library Buckram. 2. Originally a costly  material from Bokhara, Southern Russia.   Later, a rich 16th Century English woollen  fabric used for church vestments."

"A heavy flat duck or Osnaburg, stiff and  durable starch filled or pyroxylin treated  and given a vellum, linen-like finish.  Used  especially on library and reference books."

The Department in order to succeed in  classifying the products of the respondents to fall  under heading 59.01 of the Act will have to fulfil the  following conditions:

1.      That the fabric in question is a stiffened  textile. 2.      That the stiffness has to be durable and  permanent in nature. 3.      That the fabric is heavily sized.

It is the stand of the respondents that the  stiffness as contemplated under Chapter 59 has to be  of permanent or durable nature as ’Buckram’ is a  fabric which has a permanent stiffness.  A fabric,  which has undergone a process of padding by  applying natural starch on the side of the fabric,  cannot be classified as ’Buckram’.  The tribunal has  found that the fabric of the respondents do not have  permanent or durable stiffness which is essential for  a fabric to be classified as ’Buckram’ in view of  definition as understood ordinarily and as is referred  to in the authoritative text books.  The report given

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by the Chemical Examiner on which the Department  has placed reliance itself indicates the process  undergone by the respondents’ fabric is only that of  padding and does not show any stiffness of  permanent nature.   

When the several ingredients have to be  satisfied, even if one ingredient is not satisfied,  namely, that the stiffness has to be of permanent  and durable nature, we do not think that the view  taken by the tribunal calls for any interference on our  hands.  In addition, we may notice that in none of  the cases presently involved, we have any heavily  sized fabric.  Therefore, that aspect need not detain  us.  

In the circumstances, we do not think that  these are fit cases where we should remand the  matter for fresh consideration on the question of  heavily sized fabric.  We affirm the view taken by the  tribunal and dismiss these appeals.