MADHUMILAN SYNTEX (P) LTD. vs UNION OF INDIA & ORS.

The Supreme Court ruled that under the Central Excises & Salt Act, 1944, specifically Tariff Item No. 18-III, the classification of spun yarn depends on the presence of non-cellulosic fibers. The Court held that the appellant's yarn, containing such fibers, was correctly classified under Tariff Item No. 18-III(ii), thus affirming the demand for differential excise duty. The Court emphasized the importance of accurate classification for tax purposes and upheld the decisions of the lower authorities.