MODI RUBBERS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) Interpretation of a notification dated 14th July 1978 issued by the Central Government in exercise of its power conferred upon it by Rule 8 of the Central Excise Rules, 1944 is in question in this writ petition.

(2.) The petitioner is a company incorporated under the Companies Act. It carries on the business of manufacture and sale of tyres and tubes. On or about 30th March 1979, a notification was issued under Rule 8 of Central Excise Rules for the purpose of granting of an incentive to smaller tyre companies in terms whereof factories whose annual capacity did not exceed five lakh number of tyres and five lakh number of tubes were entitled to the benefit of remission of duty as specified therein. However, exemption of 25% of the duty leviable was given in respect of smaller units which were new units and commenced production after 1st April 1976. Furthermore, concessional rate of duty not exceeding 75% of the licensed capacity of the factory for the financial year 1978-79 was also to be given subject to the fulfillment of the eligibility criteria thereof wherefor it was required to determine the licensed capacity as certified by the Development Officer of the Directorate General of Technical Development.

(3.) The petitioner applied for grant of a licence in terms of Section 11 of the Industries (Development and Regulation) Act, 1951 and Rule 15(2) of the Registration and Licensing of Industrial Undertaking Rules, 1952 which was granted subject to the following conditions: