RULE 49A. Collection of duty leviable on cellulosic spun yam and cotton yam along with the duty on cotton fabrics

Where a manufacture, -

(i) who manufactures cellulosic spun yam not containing synthetic staple fibre falling within Chapter 55 and cotton yam not containing synthetic staple fibre falling within Chapter 52 of the Schedule to then Central Excise Tariff Act, 1985 (5 of 1986) or both, and uses the whole or part of the yam so manufactured in the manufacture of cotton fabrics in his own factory, or

(ii) who being a composite mill, brings such yam under rule 96E or rule 96EE, as the case may be, from outside for the purpose of manufacture of cotton fabrics in his own factory; makes an application to the Commissioner in this behalf, shall, on such application being granted by the Commissioner, pay the duty leviable on such cellulosic spun yam and such cotton yam along with the duty on such cotton fabrics in the manner prescribed in rule 52, subject to the following conditions, namely: -

(1) when the cotton fabrics are cleared grey (unprocessed), the yam duty payable shall be-

(a) the appropriate duty payable on such cellulosic spun yam or cotton yam, or both, as the case may be; plus

(b) one and a half per cent of the duty payable on such cellulosic spun yam 9 or cotton yam, or both, as the case may be, by way of interest on the amount of yam duty;

(2) when the cotton fabrics are cleared after processing, the yam duty payable shall be-

(a) the appropriate duty payable on such cellulosic spun yam, or cotton yam, or both, as the case may be; plus

(b) three per cent of the duty payable on such cellulosic spun yam, or cotton yam, or both, as the case may be, by way of interest on the amount of yam duty, provided that where the cotton fabrics are cleared without payment of duty leviable thereon for processing under rule 96-D, the duty payable on such cellulosic spun yam and cotton yam plus the interest at the rate of three per cent thereof may be paid at the time of clearance of such fabrics after processing from the composite mill or the factory which processes such fabrics, as the case may be.

Explanation. -For the purposes of this rule, "Composite mill" means a manufacturer who is engaged in spinning of cotton yam or weaving or processing of cotton fabrics with the aid of power and has a proprietary interest in at least two of such manufacturing activities.