SAINET PRIVATE LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are a factory situated at Corlim, Panaji, Goa. The petitioners are carrying on the activity of making nylon fishnets, "knitted" fabrics from the year 1972. The said fishnets are manufactured from Nylon Yarn which is doubled and twisted for making into Nylon twine yarn. The fishnets are made by knitting process.

(2.) The petitioners say that they are governed by the Central Excises Act in regard to the classification of goods and the Government in exercise of its powers exempted all man-made fabrics specified under the Notification No. 80/69, dated 1st March, 1969 from Excise duty.

(3.) The petitioners further say that the said product when it comes into existence by a process of weaving the said Nylon twine yarn without specifically averring that the expression "fabric" includes any substance which has been made inter alia, from yarn by a process of knitting. Then the petitioners have referred to certain standard Books and Nomenclatures and stated that these nets which they are manufacturing were also subject-matter of levying duty under the Sales tax authorities and they have treated these nets as fabrics. It appears that the petitioners were no doubt paying the duty as demanded by the respondents. But in September, 1981 the petitioners requested the respondent No, 2 to classify the product as falling under Tariff Item No. 22 of the First Schedule of the Central Excises and Salt Act, 1944. The petitioners pointed out that a similar question was raised in another matter of M/s. Garware Marine Industries Ltd., formerly known as Modern Nets Ltd. who were also manufacturing nets for the past several years and were clearing fishnets as knitted fabrics. It was averred in the petition in para 8 that the Excise Authorities in Bombay had classified these identical nets manufactured by Messrs. Sadhana Knitters as falling under Tariff Item No. 22. A copy of that letter was also annexed to that petition.