Case: Supdt. of Central Excise and Ors Vs. Ayyangar Match Works and Ors

3. 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. v. M/s. Parameswaran Match Works etc. - (1975) 2 S.C.R. 573 set aside the orders of the High Court and dismissed the writ petitions.4. The present appeals were not heard at that time because service was not complete.5. 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.6. 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. 3.75 per gross from the petitioners in pursuance of Notification dated 21 July, 1967 as amended by Notification dated 4 September, 1967.7. 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 rate of Excise duty at Rs. 3.75 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. 3.75 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 manufacturer 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.8. The High Court accepted the petition of the respondents following the judgment in Writ Petition No. 3838 of 1968, dated 11 December, 1968.

Reasoning:
13. The appeals are all covered by the decision in M/s. Parameswaran Match Works case (supra).Court in M/s. Parameswaran Match Works case (supra) held that the purpose of the Notification dated 4 September, 1967 was to enable bona fide 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 theare no allegations in the petitions in the High Court that the respondents were recommended by the Khadi and Village Industries Commission for exemption as bona fide 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).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.