Civil Appeals Nos
133 188 of 1975
Appeals by Special Leave from the Judgments and Orders dated the 1 29 4 1970 2 28 7 1970 3 12 3 1970 4 28 7 1970 5 7 9 1970 6 7 4 1970  7 12 3 1970 of the Madras High Court at Madras in 1 WP Nos
2929 3253 and 68 123 and 260 of 1970 2 WP Nos
1606 and 160770 3 WP Nos
1998 2484 2567 2568 2569 2663 65 3046 3125 3126 3182 3363 65 3410 3508 3555 60 3630 3631 3667 3668 3810 3812 and 869 3650 of 1969 4 WP Nos
2647 264869 and 1121 1451 1452 and 1495 and 1496 of 1970 5 WP Nos
1912 1913 1919 2123 2318 2516 and 2610 of 1970 6 WP Nos
2088 2317 and 251570 and 7 WP No 3666 of 1969 respectively
Niren De Attorney General of India and R N Sachthey for the Appellants
M R M Abdul Karim and Shaukat Hussain for the Respondents In Cas
Nos 137 140 149 152 155 164 169 178 179 181 182 183 and 18775 Mrs section Gopalakrishnan for the Respondents In CA No 177 of 1975
The Judgment of the Court was delivered by RAY CJ
These appeals arise out of the judgment dated 11th December 1968 in writ petition No 3838 of 1968 in the High Court at Madras
In the present appeals the writ petitions in the High Court were allowed following the judgment of the High Court in the aforesaid writ petition No 3838 of 1968
In Civil Appeals No 262 273 of 1971 arising out of the common judgment dated 11 December 1968 of the High Court at Madras in writ petition No 3838 of 1968 this Court in the decision in Union of India  Anr
vs Ms Parameswaran Match Works etc
set aside the orders of the High Court and dismissed the writ petitions
The present appeals were not heard at that time because service was not complete
This Court by order dated 14 July 1975 directed that these appeals be listed for hearing on 21 November 1975
The Union made an application for consolidation of appeals reduction of security and early hearing of the appeals
The respondents were served in that application
Pursuant to that application this Court ordered on 14 July 1975 the hearing of the appeals on 21 November 1975
The respondents have entered appearance in all these appeals
In these appeals the respondents who were petitioners in the High Court asked for a writ of prohibition restraining the appellants from collecting any duty in excess of Rs 375 per gross from the petitioners in pursuance of notification dated 21 July 1967 as amended by notification dated 4 September 1967
The case of the respondents in the High Court was that they filed declaration on 22 December 1969 for 1969 70 that they would not produce more than 75 million match sticks during the financial year
The respondents claimed to be entitled to the concessional 870 rate of excise duty at Rs 375 per gross pursuant to the notification dated 21 July 1967
The further case of the respondents in the High Court was that the notification dated 4 September 1967 was issued stating that the concession of Rs 375 per gross would be available to such D Class manufacturers who had filed the declaration before 4 September 1967
The respondents challenged the fixing of the date 4 September 1967 as an arbitrary time limit making unreasonable discrimination between the same category of manufacture simply on the basis of the application being before or after 4 September 1967
The respondents craved reference to the judgment of the High Court in writ petition No 3838 of 1968 dated 11 December 1968 and prayed for orders in terms of that judgment
The High Court accepted the petition of the respondents following the judgment in writ petition No 3838 of 1968 dated 11 December 1968
The appellants challenged the decision of the High Court and relied on the decision of this Court in Ms Parameswaran Match Works case supra
This Court in Ms Parameswaran Match Works case supra held that the purpose of the notification dated 4 September 1967 was to enable bonafide small manufacturers of matches to earn a concessional rate of duty by filing the declaration
The small manufacturers whose estimated clearance in a year was less than 75 million matches would have availed themselves of the opportunity by making the declaration as early as possible because they would become entitled to the concessional rate of duty on their clearance from time to time
The purpose of the notification was to prevent larger units who were producing or clearing more than 100 million matches in a year and who could not have made a declaration from splitting up into smaller units in order to avail of the concessional rate of duty by making the declaration subsequently
The classification founded on a particular date was held to be reasonable because the choice of a date was to protect the smaller units in the industry from competition by the larger ones and that object would have been frustrated if by adopting the device of fragmentation the larger units could become the ultimate beneficiaries of the bounty
Counsel for the respondents relied on an observation of this Court in Ms Parameswaran Match Works case supra at page 576 of the Report to the effect that the manufacturers who came to the field after 4 September 1967 were entitled to concessional rate of duty if they satisfied the condition prescribed in clause d of the notification dated 4 September 1967
In Ms Parameswaran Match Works case supra the match works asked for a licence on 5 September 1967 for manufacturing matches stating that it began the industry from 5 March 1967 and also filed a declaration that the estimated manufacture for the financial year 1967 68 would not exceed 75 million matches
Parameswaran Match Works contended there that it was denied the benefit of the concessional rate of duty on the ground that it applied for a licence and filed the declaration on 5 September 1967 after the expiry of the fixed date
This Court held that the 871 concessional rate would be availed by them who satisfied the condition laid down in the notification
The case of the respondents as laid in the petition before the High Court was that they were claiming an order in terms of the judgment in writ petition No 3838 of 1968
There is no allegation in the petition that the respondents came to the field after 4 September 1967 or that they started manufacturing matches after 4 September 1967
The notification dated 4 September 1967 gave relief inter alia to factories mentioned in sub clause d of the notification
The factories mentioned in sub clause d are those whose production during any financial year does not exceed or is not estimated to exceed 100 million matches and are recommended by the Khadi and Village Industries Commission for exemption under this notification as a bonafide cottage unit or which is set up by a cooperative society registered under any law relating to cooperative societies for the time being in force
There are no allegations in the petitions in the High Court that the respondents were recommended by the Khadi and Village Industries Commission for exemption as bonafide cottage units or were set up by cooperative society registered under any law relating to cooperative societies
No case was made by the respondents in the petitions on the basis of exemption under sub clause d
A contention was advanced by the respondents that the Khadi and Village Industries Commission was not competent to make any recommendation as contemplated in sub clause d 
Section 15 of the which speaks of the functions of the Commission states in clauses c d f g and h that the Commission may take steps to provide for the sale and marketing of khadi or of products of village industries to encourage and promote research in the development of village industries
to undertake assist or encourage the development of village industries to promote and encourage cooperative efforts among manufacturers of khadi and persons engaged in village industries
Section 15h specifically states that the Commission may take steps for ensuring the genuineness of and for granting certificates to producers of or dealers in khadi or the products of any village industry
These provisions indicate that the Khadi and Village Industries Commission is competent to grant certificates recommending village industries for exemption under clause d of the notification dated 4 September 1967
The appeals are all covered by the decision in Ms Parameswaran Match Works case supra
The appeals are accepted
The orders of the High Court are set aside and the petitions are dismissed
There will be one set of costs to the appellants
PBR Appeals allowed


Summary:
For the purpose of protecting the smaller manufacturers from the cometition of larger manufacturers the Government of India by a notification dated 21 July 1967 amended by notification dated 4 September 1967 declared a concessional rate of duty to those manufacturers who had filed a declaration before 4 September 1967 that their estimated annual clearance would be less than 75 million match sticks
This Court in Union of India vs Parameswaran Match Works etc  setting aside the judgment of the High Court holding that classification was invalid held the classification founded on a particular date to be reasonable and the concessional rate would be availed of even by those manufacturers who came to the field after 4 September 1967 if they satisfied the condition in clause d of the notification regarding quantity of matches and are recommended by the Khadi and Village Industries Commission for exemption
The respondent filed declarations on 22 December 1967 that they would not produce more than 75 million match sticks during the year 1969 70 and claimed to be entitled to the concessional rate of excise duty
In appeal to this Court the respondents sought to support the judgment of the High Court on the grounds i that they were entitled to the exemption on the basis of clause d of the notification and ii that the Khadi and Village Industries Commission was not competent to make any recommendation
Allowing the appeal  HELD 1 The appeals are covered by the decision of this Court in Parameswaran Match Works case and no case is made out by the respondents on the basis of exemption under cl
d of the notification
There is no allegation in the petition that the respondents came into the field after 4 September 1967 or that they started manufacturing the matches after 4 September 1967 or that they were recommended by the Khadi and Villages Industries Commission mission
871 D  B 2 Under section 15h of the the Commission may take steps in ensuring the genuineness of and for granting certificates to producers of or dealers in Khadi or the products of any village industry
Therefore the Commission is competent to recommend for exemptions under cl
d of the Notification