The basic criteria for determining whether a yarn is classifiable as "noncellulosic spun yarn" within the meaning of Tariff item No. 18e of the First Schedule with the Act, and thus qualified for exemption under Notification No. 332/77-F and No. 10/9177-CSII, dated 1st December, 1977, is the predominant presence, in weight, of the man made fibre of non cellulosic origin other than acrylic fibre.

( 1 ) THE challenge in these two writ petitions, being decided by this common judgment, is to the two orders, dated 20th January, 1982 (in C. W . P. No. 1312182) and 15th March, 1982 (in C. W. P. No. 3418;s2) passed by the Government of India on petitioners revision application. By the impugned orders the Government of India upheld the orders passed by the Collector, Customs and Central Excise under section 35a of the Central Excise and Salt Act, 1944 (in short the act ) holding that yarn containing 70 per cent polypropylere fibre and 30 per cent acrylic fibre did not fall within the ambit of Tariff item l8e in the First Schedule of the Act.

( 2 ) THE petitioners are manufacturers of various type? of yarn and also undertake spinning of yarn on job work basis. In August/october, 1978 the petitioners entered into agreements to manufacture and supply to other concerns polypropylene spunyam which is stated to be made from polypropyleae fibre and acrylic fibre in the ratio of 70 : 30. However, before commencing production of the said product one of the petitioners , vide its letter dated 7th September, 1978 sought confirmation from the Excise Department that the polypropylene spun yarn manufactured with the aforesaid ratio of acrylic fibre would be free from excise duty under notification No. 332/77-F and No. JC/9/77 -CSII dated 1st December, 1977, which exempted "polypropylene spun yarn", falling under Tarirf item No. 18e of the First Schedule to the Ad, from the whole of the duty of Excise leviable thereon. The Assistant Collector, Central Excise Division. Ludhiana vide his communication dated 11th September, 1978 informed the said petitioner that the said blends of polypropylene yarn containing 70 per cent polypropylene and 30 per cent acrvlic fibre would be classifiable under Tariff item 18e and entitled to exemption under the said notification.

( 3 ) TO comply with the relevant rules, the petitioners filed classification list in the prescribed form with the excise authorities giving description of the goods to be manufactured by them as under.- "polyprupylene SPUN YARN" Polypropylene Spun Yarn contains Polypropylene Fibres 70 per cent and Acrylic Fibre 30 per cent and in or in relation to the manufacture of which any process is ordinarily carried on with aid of power".

( 4 ) IN the said form the petitioners had claimed that the said product was not liable to excise duty, being exempt under the aforesaid notification. The said classification was accepted by the Superintendent and the Assistant Collector, Central Excise. The petitioners, thus during the months of October, November and December, 1978 manufactured the said product and cleared the same without paying any excise duty. Thereafter, the Superintendent, Central Excuse (Range III ), Ludhiana, vide his notice dated 24th March, 1979, purporting to he under Rule 10 of the Central Excise Rules, 1944 asked the petiotioners to show cause to the Assistant Collector. Central Excise. , Ludhiana, why excise duty be not levied on the said polypropylene vim and the amount so determined be not recovered from them. A reply to the said notice was filed wherein it was pleaded that polypropylene yarn was exempt from excise duty under the aforesaid notification. In this behalf reliance was also placed on the aforesaid communication of the Assistant Collector. Central Excise, dated 8th September, 1978 On a due consideration of the reply filed by the petitioners, the Assistant Collector, vide his, order dated 2nd June. 1979 held that polypropylene yarn containing per cent polyproplene fibre and 30 per cent Acrylic fibre was not liable to excise duty as the basic criteria of predominance of polypropylene more m the yarn was fulfilled. He thus discharged the notice.

( 5 ) IT appears, however, that the department had a second look at the matter. The Collector, Central Excise, apparently not satisfied with the aforesaid order of the Assistant Collector, he, in the exercise of h