N.P. Singh, J. - (1.) M/s. Punjab Footwear Limited, the appellant, have been manufacturing footwears. It appears that the process of manufacturing of footwears is partly done by the appellant and partly by M/s. Stepwell Industries Limited on behalf of the appellant on the basis of an agreement entered into between the appellant and the said M/s. Stepwell Industries Limited.
(2.) In respect of the claim for benefit under Notification No. 88 of 1977 CE dated 9-5-1977, the Collector of Central Excise, Chandigarh by his order dated 21-8-1980 held that the number of workmen directly employed by the appellant as well as the number of workmen employed by M/s. Stepwell Industries Limited are to be counted and as the number of workmen in both the factories exceeded 49, the appellant was not entitled to the benefit of aforesaid Notification. 2A. The Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as the Tribunal) affirmed the aforesaid finding of the Collector saying that for purposes of granting or refusing the benefit of the Notification aforesaid the number of workers working in the factory of the appellant as well as the factory of M/s. Stepwell Industries have to be taken into consideration and as the number of workmen exceeded 49, the appellant was not entitled to the benefit of the aforesaid Notification. On that finding, the appeal of the appellant was dismissed. The relevant part of Notification No. 88 of 1977 read as follows : "In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules 1944, and in supersession of the notification of the Government of India in the Department of Revenue and Banking No. 103/76 Central Excise, dated the 16th of March, 1976, the Central Government hereby exempts footwears falling under sub-item (1) of Item No. 36 of the first schedule to the Central Excises and Salt Act, 1944 (1 of 1944, from the whole of the duty of excise leviable thereon :- Provided that :- (i) Such footwear is produced by or on behalf of a manufacturer in one or more factories, including the precincts thereof, wherein not more than 49 workers are working, on any day of the preceding 12 months, or (ii) the total equivalent of power used in the manufacture of such footwears by or on behalf of a manufacturer in one or more factories does not exceed 2 Horse Power."
(3.) The learned counsel appearing for the appellant urged that in view of proviso (i, the appellant was entitled to the benefit of Notification in question because the footwears were being produced by or on behalf of the appellant which shall be deemed to be manufacturer in one or more factories. It was pointed out that M/s Stepwell Industries shall not be deemed to be a factory belonging to the appellant, as such the workmen of M/s. Stepwell Industries should not be counted for purposes of granting or refusing benefit of the Notification. It was also submitted that the expression such footwears occurring in proviso (i) has to be read with reference to the footwears manufactured directly by the appellant in their own factory and the number of workmen working in the factory of the appellant shall be the determining factor.;