Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs, New Delhi
Subject: Classification of float cut grey woven pile fabrics (Corduroy)
Doubts have been raised whether grey woven paid fabrics after float cutting are classifiable under chapter heading 5801.21 of the CETA, 1985 as grey woven pile fabrics or under chapter heading 5801.22 as processed pile fabrics.
2. The matter has since been examined in the Board. It is observed that there are two types of pile fabrics (i) weft pile fabrics and (ii) warp pile fabrics. In case of pile fabrics, the loops may remain uncut at the time of weaving or may be cut by the rawor-like blade as weaving proceeds leaving a cut pile surface Common examples are corduroy,
3. Corduroy is a weft pile fabrics where long floats on the surface are made by an extra weft. After the cloth is woven, the floats are cut in their centre, after cutting, the fibres tend to spring upward and later are brushed up to form the pile in ridges or cords. These ridges are rounded with the longest fibres in the centre and the shortest fibres on each side.
4. Velvet is a warp pile fabrics (i) woven with two cloths woven face to face with the pile ends interchanging between the two, these pile ends are cut on the loom by a reciprocating knife blade to produce two separate pieces of velvet. (ii) In another method, the pile ends are lifted over cutting wires which are inserted to cut the piles as the wire is withdrawn.
5. According to note 2 to ch. 58, heading no. 58.01 also includes woven weft pile fabrics which have not yet had the floats cut, at which stage they have no pile standing up. this inclusive meaning assigned to woven weft pile fabrics confirms the view that before the float cutting, it otherwise would not have been treated as a pile fabrics but for the inclusive definition. Furthermore, this amplification has been done in case of weft pile fabrics only because in case of weft pile, the floats are not cut at the time of weaving. The woven pile fabrics, actually comes into existence only after floats are cut and when these stand up to form a pile. Thus, whether floats are cut afterwards or during weaving the fabric so woven remains unprocessed.
6. If a cut float pile fabrics is treated as a processed fabrics, a corduroy where the piles are cut after the fabric is woven would fall under sub-heading 5801.22 where as a velvet or velveteen where a cut float pile fabric emerges off-loom would remain under sub-heading 5801.21. It does not stand to reason that if weaving is done first and then float-cutting separately, classification would be done first under Sub- Heading 5801.21 and then Sub-Heading 5801.22 but if weaving and cutting are done simultaneously, the cut-float pile fabrics that emerge off the loom, would be classified under Sub-Heading 5801.21.
7. Therefore, the Board has decided that cut-float pile fabrics as well as uncut pile fabrics both would be treated as woven pile fabrics not subjected to any process falling under sub-heading 5801.21. However a cut float pile fabrics being commercially distinct from uncut pile fabrics, applying the ratio of supreme Court pronouncements, The process of float cutting and brushing would amount to manufacture of a new commercially distinct product. However, float cutting and brushing would not fall under the category of “any other process” as mentioned under chapter Note 8 of Ch. 58. Board observed that “any other process” appearing in chapter note B or in the text of sub-heading 58.01.22 should necessarily be a process belonging to same class or genus as preceding it and to which the woven cut float pile fabrics are subjected to and not a process before the cut float pile fabrics comes into existence. As a result, though float-cutting would amount to manufacture as defined under Section 2(f) of the CEA 1944 would not change the classification of woven pile fabrics from 5801.21 to 5801.22.
The Receipt of this Circular may please be acknowledged. Pending assessments may be finalised accordingly.