V.T. Raghavachari, Member (J)

1. M/s. Synthetic Cutting Tools Manufacturing Company manufacture resin impregnated/coated discs of glass fabrics which are excisable under item 22-F of the First Schedule to the Central Excises Salt Act, 1944. The 'Assistant Collector under order dated 7.7.1979 held these discs liable for duty under tariff item No. 22F CET as they were not eligible for the exemption under notification No. 87/76-CE dated 16.3.1976. On Appeal the said order was set aside by the Appellate Collector under order dated 20.11.8.0. He held that the fabric continues to be the fabric even when cut into discs and as the entitlement of full exemption to the fabrics is not in dispute the discs were also entitled to the same exemption. The Central Government being of the view that the said order of the Appellate Collector was not proper, legal and correct, issued notice dated 14.5.81 under section 36(2) of the Central Excises and Salt Act calling upon the manufacturer to show cause why the order of the Appellate Collector should not be set aside and that of the Assistant Collector restored or any other order passed as may be deemed fit and proper. The Government was prima fac