NECTAR BEVERAGES PVT. LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) DENIAL of the benefit of exemption granted to Small Scale Industrial units, to the petitioners who are SSI units but are alleged to be using the brand name/trade name of another, is the subject matter of these writ petitions.

(2.) AS per Notification No. 175/86, Small Scale Industries (SSI Units, for short) were granted exemption from the levy of duty under the provisions of the Central Excises and Salt Act, 1944 ('the Act'). Subsequently, by Notification No. 223/87 dated 22 -9 -1987, para -7 was added to the earlier Notification, effect of which is to deny the exemption to the SSI Units using the brand name/trade name of another person who is not eligible for the grant of exemptions under the Notification. These Notifications were issued under Rule 8(1) of the Central Excise Rules.

(3.) THE relevant parts of the first Notification read as follows : "Notification No. 175/86 -C.E., dated 1 -3 -1986. - In exercise of the powers conferred by sub -rule (1) of Rule 8 of the Central Excise Rules, 1944, and an supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 85/85 -Central Excise, dated the 17th March, 1985, the Central Government hereby exempts the excisable goods of the description specified in the Annexure below and falling under the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), (hereinafter referred to as the 'specified goods'), and cleared for home consumption on or after the 1st day of April in any financial year, by a manufacturer from one or more factories, - (a) in the case of the first clearance of the specified goods upto an aggregate value not exceeding rupees seven and a half lakhs, (i), (ii), (b) (c) xx xx (omitted as unnecessary) 2. xx xx 3. xx xx (omitted as unnecessary) 4. The exemption contained in this notification shall be applicable only to a factory which is an undertaking registered with the director of Industries in any State or the Developmental Commissioner (Small Scale Industries) as a small scale industry under the provisions of the Industries (Development and Regulations) Act, 1951 (56 of 1951)." (rest omitted as unnecessary) The second notification is as follows : "Notification No. 223/87 -Central Excise, G.S.R. 813 (E) : - In exercise of the powers conferred by sub -rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Government hereby makes the following further amendments in the notification (Department of Revenue) No. 175/86 Central Excise, dated the 1st March, 1986, namely, - In the said notification : -