S. Duggal, J.

1. The point falling for Determination in this appeal is scope of the benefit of Exemption Notification No. 197/67 dated 29-8-1967, as amended from time to time; particularly with reference to Sub-item (3) of the Table annexed thereto, vis-a-vis the goods manufactured by the appellants, bearing the trade name : "Aprons' and 'Cots'.

2. We consider it expedient to reproduce the said notification, as well as the relevant Tariff Entry, so as to facilitate appreciation of area of controversy.

"Notification No. 197/67-C.E. dated 29-8-1967 as amended by Notification No. 1/68-C.E. dated 6-1-1968; No. 161/70-C.E., dated 29-8-1970; No. 17/73-C.E. dated 3-2-1973 and No. 72/74-C.E. dated 13-4-1974.

EXEMPTION to piping and tubing of unhardened vulcanised rubber:-In exercise of the powers conferred by Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Govt. hereby exempts piping and tubing of unhardened vulcanised rubber, falling under Sub-item (3) of Item No. 16A and specified in column (2) of the Table below from the whole of the duty of excise leviable thereon :-

xxx xxx xxx

3. The aforesaid tariff item was inducted in the Central Excise Tariff (GET for short) in 1967. Case of the appellants as set out in the grounds of appeal is :- that they are manufacturers of tubings made out of synthetic rubber; two of such products bearing, the popular name 'Cots' and 'Aprons' which are said to be used as components of textile machinery. Synthetic rubber, which is taken as a raw material, is subjected to a series of processes, including extrusion and vulcanisation. At one stage, unhardened tubes emerge as a result of the manufacturing activity, which tubings, according to the appellants, are finally cut to specific lengths, according to the requirement conveyed by the customers in their orders. The appellants plead that these 'Cots' and 'Aprons' are designed according to technical patent processes and conform to ISI specifications for Synthetic Rubber Cots and Aprons (I.S. 7175-1974 and J.S. 4892-1968).

4. The genesis, as narrated in the appeal, is traced to the introduction of Tariff Item 16A in the GET in the year 1967, and the appellants allege that as a result of this entry, the pipings and tubings made by them, being of unhardened vulcanised rubber, were taken to be covered by Sub-Item (3) of T.I. 16A of the CET and they started paying central excise duty accordingly. But on an exemption Notification being issued with effect from 29-8-67; namely, Notification No. 197/67, exemption was claimed with reference thereto, which position was conceded by the Department.

5. The appellants allege 'that this stand; namely, the goods being covered by T.I. 16A (3) and then held entitled to benefit of Exemption Notification No. 197/67 was confirmed by the Collector in his order dated 10-6-1968 whereby although the refund claim filed by them was dismissed on the view that the notification could not operate retrospectively but it was clearly held that with effect from the date of said notification, the products would be exempt from excise duty, and that before that there was endorsement of this position by the Collector of Central Excise also, vide his letter dated 21-10-1967.

6. The appellants further plead that this position continued, and clearances effected after due declaration on the classification lists to the effect that excisable goods were being manufactured, but cleared without payment of duty by virtue of the aforesaid notification, and even after the introduction of T.I. 68 in the GET, the Superintendent of Central Excise vide his letter dated 7-3-1975 confirmed that these goods known as 'Accotex Synthetic Rubber Cots and Aprons' were not falling under T.I. 68, and that their factory did not come to be covered under Central Excise control.

7. The appellants further contend that the decision to classify Cots and Aprons under T.I. 16A(3), and then accord benefit of exemption Notification No. 197/67, was a well-considered