CARONA SAHU CO LTD Vs. SUPERINTENDENT CENTRAL EXCISE

JUDGEMENT

(1.) By this petition filed under Article 226 of the Constitution of India, the petitioners are challenging the legality of the show cause notice dated October 20, 1977 issued by the Superintendent, Morvi Central Excise, Agra, and the copy of the notice is annexed as Exh. G to the petition.

(2.) Only few facts are required to be stated to appreciate the grievance of the petitioners. The petitioner No. 1 is a public limited Company registered under the provisions of the Companies Act and have their registered office is Bombay. The petitioners inter alia carry on business of manufacture, sales and purchase of various types of footwears and parts thereof. The petitioners own factories in Maharashtra and in the course of business also purchase foot wears from other manufacturers and dealers and re-sell the same to the public at its retail shops located throughout India. The petitioners claim that they have no connection whatsoever with the manufacture of footwears or manufacturing activities of their suppliers.

(3.) An excise duty is levied on footwear and parts thereof at the rates set out in the First Schedule to the Central Excises and Salt Act, 1944 (hereinafter referred as the Act). The Government of India, in exercise of the powers conferred by Rule 8(1) of the Central Excise Rules, 1944 issued a notification dated May 26, 1967 exempting footwear falling under sub-item (1) of Item No. 36 of the First Schedule of the Act from the whole of the duty of excise leviable thereon if such footwears were not being produced in any factory including the precincts thereof, wherein 50 or more workers were working or had been working on any during the preceding twelve months or where the total equivalent of power used in the process of manufacturing footwear does not exceed two Horse Power. The Government of India issued another Notification dated May 9, 1977 in exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, and in supersession of the earlier notifications dated May 26, 1967 and March 16, 1976. The said notification reads as under :