G.A. Brahma Deva, Member (J)

1. This appeal arises out of and is directed against the Order-in-original No. 56/MP/89 dated 19-10-1989 passed by the Additional Collector of Central Excise and Customs, Vadodara.

2. The facts of the case, in brief, are that according to the Department, the appellants have manufactured/processed and removed the processed man-made fabrics valued at Rs. 2,78,138.75 Paise falling under Chapter/Sub-heading No. 5409 of the Central Excise Tariff Act, 1985 during the period from 19-12-1987 to 21-1-1988 from their factory by recourse to fraud, wilful mis-statement, suppression of facts and with a deliberate and wilful intent to evade payment of duty of excise amounting to Rs. 54,297.56 illicitly without obtaining any Central Excise Licence for such manufacture/process, without following the central excise procedure and without payment of central excise duty at the appropriate rate leviable thereon. The main charges against the appellants are that they have processed fabrics by Tapela process and calendering with aid of power would subject to man-made fabrics and is liable to central excise duty. The Additional Collector who adjudicated the proceedings dropped the first charge, i.e., Tapela Dyeing process on the ground that since the process is not undertaken with the aid of power and steam, it does not fall within the purview of Tariff description. As such, Tapela processed fabrics would be exempted from levy of central excise duty. As regards second issue, the contention of the applicant that they were not having calendering machines at the relevant point of time and calendering process, i.e., ironing with calendering machine having plain rollers does not amount to process of manufacture, was negatived by the Adjudicating Authority and held that since the applicants were subjecting the man-made fabrics to calendering with the plain rollers and also dyeing with Tapela Dyeing Process in the same premises, they would not be eligible for exemption from payment of duty in terms of Notification No. 297/79-C.E., dated 24-11-1979. Accordingly, he ordered for confiscation of 4941 Sq. Mtrs. processed man-made fabrics and since the same has already been released provisionally and not available for confiscation he ordered for appropriation of Rs. 5,000/- out of the cash security deposit. He confirmed the demand of duty amounting to Rs. 54,297.56 Paise, in addition to imposing penalty of Rs. 5,000/- under Rule 173Q of Central Excise Rules. Hence this appeal.

3. We have heard Shri Willingdon Christian, learned Advocate for the appellants and Smt. J.M.S. Sundaram, learned JDR for the respondent.

4. Shri Willingdon Christian submitted that process of calendering of fabrics with the help of plain rollers does not amount to manufacture and this issue was squarely covered by the decisions of the Supreme Court in the case of Mafatlal Fine Spinning Mfg. Co. Ltd. v. Collector of Central Excise, reported in MANU/SC/0298/1989 : 1989 (40) E.L.T. 218 (S.C.) and same was followed by the Tribunal in the case of Siddheswari Cotton Mills (Pvt.) Ltd., Calcutta v. Collector of Central Excise, Calcutta, reported in 1989 (14) E.T.R. 343 as well as in the case of Bhartiya Textiles, Bombay v. Collector of Central Excise, Bombay-I, reported in 1991 (17) E.T.R. 387. Smt. J.M.S. Sundaram submitted that those decisions are not applicable to this case as they were held with reference to the old Tariff and issue relates to new Tariff in the present case, since substantial change has taken place in the relevant entry under the new Tariff. In view of this submission, the learned counsel for the appellants has chosen to address arguments on other aspects also. He said that ratio of the aforesaid decisions still holds good since there has been no change in the phraseology except the same definition was bodily lifted. On facts, he submitted that the appellant's firm was a proprietary concern owned by Shri Narottambhai C. Patel and not a partnershi