Susanta Chatterjee, J. - (1.) The present Rule was issued on 31st of October, 1979 at the instance of the writ petitioner a Company formerly known as "Birpara Tea Company Limited". The petitioner Company has challenged the orders dated 28th of July, 1978 and 27th of October, 1976 in order to obtain exemption under the Notification dated June 16, 1976 bearing No. 198 in accordance with the petitioner's application dated May 31, 1978 and for other consequential reliefs on the grounds that the procedure mentioned by the respondent No. 1 the Assistant Collector of Central Excise, Calcutta-I Division in the order dated July 28, 1978 is not at all in accordance with the procedure laid down in the Notification No. 198 dated June 16, 1976. It is stated that in terms of the said Notification base periods and base clearances for each of the three categories of factories have to be determined separately in accordance with the procedure specified therein. It is further stated that there is no provision in the said Notification for fixing up the base clearances of those manufacturers who are having factories under different categories in a different way or by taking the total base clearances fixed up for categories 'B' and 'C of the said Notification. It is stated in details that the petitioner Company became the manufacturer with regard to the six different tea gardens purchased by it from different Sterling Companies on and from respective dates of the ownership thereof. For the purpose of granting relief to the petitioner under the said Notification, clearances of tea, if any, made by the Vendors of the said tea gardens prior to the date of the petitioner's ownership thereof cannot be taken into account. The said six tea gardens have to be categorised only on the basis of the date on which the clearances are made therefrom the first time by and on behalf of the petitioner. It is further placed on record that the respondent No. 1 had no right and/or authority or jurisdiction to hold that the factories which were in existence prior to April 1, 1976 but whose ownership has changed hands would not be as new factories or that the clearances from April 1, 1973 to March 31, 1976 have to be taken into account for determining the base periods irrespective of as to when the first clearance was made during the said period by or on behalf of the particular manufacturer. It is alleged that the Trade Notice dated July 1, 1976 issued by the Collector of Central Excise, Calcutta in so far as it provides that the factories which were in existence before April 1, 1976 but whose ownership has changed hands would not be considered as 'new factories', is illegal, invalid and without jurisdiction. It is claimed that the levying and collecting central excise duty without granting the exemption conferred by the said Notification, the respondents are depriving the petitioner of its benefits without the authority of law.
(2.) The writ petition is contested by the respondents by filing affidavit-in-opposition. It is disclosed inter alia that in the year 1972-73 the petitioner entered into six separate agreements with Sterling Tea Companies for purchase of tea gardens including land, building, tea bushes, structures, including godowns, factory, Bungalow, plant and machinery except all dues, accruals, claims of realisation upto 31-12-1972 and all export rights relating thereto and all stocks and stores and all cash in hand and outstanding advances on December 31, 1972 relating to and belonging to the six different estates in India. It is further stated that the 'manufacturer' defined in Section 2(f) of the Act includes a person who employs hired labour in production and/or manufacture of excisable goods and also any person who engages in their production or manufacture on his own account. As per terms in paras (11) and (12) of the agreement of purchase and after approval of sale by Reserve Bank of India, the purchaser virtually became the manufacturer in the true sense of the term with effect from 1-1-1973 though in fact the Vendor was manufacturing on behalf of the purchaser till the final transfer of ownership. The licence (L-4) could not be granted and the allotment P.L.A. Number could not be made in favour of the purchaser, until the sale was legalised by completion of conveyance after approval of sale by Reserve Bank of India. It is further disclosed that the intention of the Notification No. 198/76 dated 16-6-1976 was to give relief any Central Excise Duty on specified excisable goods to encourage higher production in sub-para (2) of Para 2 of the Notification it is stated inter alia that after comparing the specified goods, the base period and base clearance, in relation to factory shall be determined. The factories producing specified goods (lea) were in existence prior to 1973 and the assets and liabilities of the six factories were vested with the purchaser with effect from 1-1-1973. As far as the exemption Notification was concerned it related only to the specified goods cleared from a factory/factories during the specified period over the base clearances determined by the competent officer the duty exemption under the Scheme is available in respect of those clearances only from whatever factory, which are in excess of the base clearances, was arrived at. In cases where such factories fall under different categories for the purpose of calculating base clearances depending upon the time when the specified goods were (or deemed to be) cleared for the first time, such manufacturer, is not entitled to the exemption unless he exceeds his base clearances. It is asserted that the impugned orders of the Trade Notice are legal and valid and the allegations made by the petitioner are wholly unwarranted and uncalled for.
(3.) The petitioner Company has, however, filed affidavit-in-reply controverting the allegations made by the respondents and reiterating the points stated in the main writ petition.;