Judgment

KRISHNA IYER, J. :- The core of the contention urged by the appellants in these various appeals filed by certificate under Article 133(1)(a) and (c) of the Constitution is that the excise duty on matches sought to be levied on these medium sized manufacturers of Shivakashi wears the mask of equality but in its true face bears the marks of unequal justice violative of Article 14 of the Constitution of India.

2. Shri Chitale, learned counsel for the appellants, has focused his arguments on one grievance only - and, we think, with good reason - that the discriminatory fiscal treatment of his clients is unconstitutional, the vice being treatment of dissimilar categories similarly. To compress his whole argument in a single sentence, it is that the appellants, small manufacturers of matches, have been subjected by the impugned notification to excise duty at the same onerous rate as has been applied to larger producers, wilfully indifferent to a historically well-recognised classification between the smaller and the larger group of match manufacturers, and the injury sustained flows from this failure to classify and deal differentially with sets of producers who are unequal in their economic capabilities in the matter of production and marketing - a sort of traumatic egality. In brief, equal treatment of unequal groups may spell invisible yet substantial discrimination with consequences of unconstitutionality. That dissimilar things should not be treated similarly in the name of equal justice is of Aristotelian vintage and has been, by implication, enshrined in our Constitution.

3. The facts which unfold the case of the appellants may now be set out. The match industry in India has grown over the decades and Shivakashi occupies an important place in the production geography of matches. From the point of view of manufacturing techniques, the safety match industry in our country comprises two distinct categories - the mechanised sector occupied by a few big whales and the non-mechanised sector comprising varying sizes of production units ranging from the small fry organised on a cottage industry basis to considerable producers who have developed manufacturing and marketing muscles sufficient to compete with the power-using big four - the WIMCO, the AMCO, the ESAVI, and the Pioneer. The Tariff Commission Report on this Industry has stated :

"Unlike units in the mechanised sector which have power-driven equipment for carrying out all the important operations including manufacture of splints and veneers, frame filling, dipping, box making, etc., those in categories "B" and "C" follow almost identical manufacturing process, obtaining their splints and veneers from outside suppliers and getting such important operations as box-making and frame filling done by outside domestic labour on piece-rate basis. Only such of the processes as dipping, box filling, banderolling and packing which under Excise or Explosive Act regulations cannot be entrusted to outside labour are carried out in the factory sheds of the units and the workers employed for these also are mostly paid on price-rate basis. All the operations, whether undertaken in the factory premises or passed on to outside piece-work labour to be carried out in the homes of the latter conjointly with other members of the family, are done by manual process. The same system is followed by "D" category units as well, except those sponsored by K. & V. I.C. some of which manufacture their own splints and veneers."

4. Classified on the basis of quantity, turnout and other germane factors, a fourfold categorisation into "A" , "B", "C" and "D" was extant in the industry roughly corresponding to the techniques of production and the use of power adopted by each. The Tariff Commission explained this aspect and reported on the operation of the differential excise levy system on production and trade practices. Counsel for the appellants has rested his case of discrimination by subversive equality o