Per Justice K. Sreedharan :

Issues to be considered in all these appeals are the same. So, we consider it advantageous to dispose of all the appeals by a common order.

2. M/s. Jyoti Overseas Ltd., appellant in Appeal Nos. E/2037-2048/97 question the correctness of adjudication order No. 161-172/Commr/CEX/97 dated 16.7.1997 passed by the Commissioner of Central Excise, Indore. M/s. Jagdish Silk Mills are aggrieved by adjudication order No. 35/CE/CHD II dated 4.1.99 passed by the Commissioner of Central Excise, Chandigarh, the adjudicating authority. The above mentioned appellants are engaged in the manufacture of cotton fabrics. The fabrics manufactured were heavily and thickly woven with multiple warp/weft/yarns. They cleared those goods without paying any duty on the belief that they fall under Chapter 52 of the Central Excise Tariff Act and so not liable to duty. Department took up the stand that the goods manufactured are classifiable under Heading 59.09 or 59.11 of the Central Excise Tariff Act. Thereupon, show cause notices were issued demanding huge amounts by way of differential duty and penalties for violation of the provisions of the Central Excise Act, 1944 and the Rules framed there under. Manufacturers tried to substantiate their contention that the goods as cleared by them from their factory were classifiable under Chapter 52 of the Tariff Act only and that they are not classifiable under Heading 59.09. Since the goods are classifiable under Tariff heading 52.05, no duty was payable. This contention of the manufacturers was overruled by the orders impugned in these appeals. Hence, the matter is before this Tribunal.

3. At first, appeals preferred by M/s. Jyoti Overseas Ltd. came up before a Bench of two Members. The said Bench came across decisions of this Tribunal taking a view contrary to the one expressed by a coordinate Bench in Simplex Mills Co. Vs. Collector of Central Excise, Nagpur, 1993 (49) ECR 147. Since coordinate Benches took conflicting views, appeals were referred to the President for being placed before a larger Bench. Accordingly, the matter has come up before this larger Bench.

4. Before examining the decisions of this Tribunal wherein conflicting views are expressed, we consider it advantageous to examine the nature of the goods, which are involved in these appeals. Appellants are admittedly engaged in the manufacture of cotton fabrics. We say' admittedly 'because the adjudicating authority has clearly stated "the fact which is not under dispute is that the noticee is engaged in the manufacture of cotton fabrics......." Grey cotton fabric so manufactured in running length was subjected to no further processing at the hands of these appellants. Such fabrics were cleared by the manufacturers from their factory. Dealers who cleared the goods used these fabrics for the purpose of making tarpaulin, tents, jeep covers, hold alls and bags. The use to which the fabrics are put by the dealers was found to be of technical character. Since the fabrics can be put to technical use, the adjudicating authority took the stand that the woven fabric manufactured by the appellants should be classified under Tariff Heading 59.09. The adjudicating authority in the order dated 16.7.97 observed:

"Therefore, once the fabrics in question is of technical use irrespective of the fact processing is done or not, the same will go to Heading 59.09 and not under Chapter 52. It may be pointed out that even if the fabrics manufactured are processed, the same would be classifiable under respective headings of Chapter 52 only if they are not of technical use; and if the fabrics has technical use irrespective of the fact no processing is carried, same will be excluded from Chapter 52 and deserves to go to Chapter 59."

The correctness of this statement is in issue.

5. Section XI of the Central Excise Tariff Act, 1985 relates to textiles and textile articles. Chapters 50to63 fall under this Section. Note 6 (a) to Section XI states that