JUDGMENT

AMARENDRA NATH SEN, J.— These appeals and also the Special Leave Petitions arise out of writ petitions filed by the appellant as the petitioners in the High Court of Judicature, Andhra Pradesh at Hyderabad. The High Court disposed of all the writ petitions by one common judgment. For reasons stated in the judgment the High Court dismissed all the writ petitions. This Court granted special leave to the appellant to file appeals against the dismissal of the writ petitions by the High Court and also directed some of the special leave petitions to be heard along with the appeals. As all the writ petitions were dismissed by one common judgment delivered by the High Court. We propose to dispose of all these matters by this judgment.

2. Two questions fall for determination in these appeals. The first question is whether on a true consideration of the Notification No. 23/70 dated 1-3-1970 issued by the Government of India, the appellant is entitled to claim exemption from the imposition of excise duty on fertilizers which according to the appellant, are mixed fertilizers manufactured by the appellant. The other question is whether the amount of commission paid by the appellant to its selling agents should be deducted as trade allowance in computing the value of the goods for assessment of excise duty.

3. It may be noted that some of these appeals are concerned with the first question, namely the exemption under the Notification No. 23/70 dated 1-3-1970, and in the remaining appeals the question of exclusion of the commission paid to the selling agent, is involved. Same questions are involved in the special leave petitions.

4. The broad facts about which there does not appear to be any serious dispute may be briefly noticed.

5. The appellant carries business as manufacturers of diverse kinds of fertilizers at the factory situated at Vishakhapatnam. The appellant considered that it would be advisable to entrust the sale of its products to organisations with experience in the sale of fertilizers, instead of the appellant itself organising sales of the fertilizers manufactured. Accordingly the appellant appointed M/s. E. I. D. Perry Limited and M/s. Rallis India Ltd., as their selling agents and entered into agreements with them for sale of fertilizers manufactured by the appellant on terms and conditions mentioned in the agreements entered into by the appellant with the selling agents. Under the terms of the agreements the selling agents were appointed by the appellant and the selling agents were entrusted with the task of arranging the sale of the fertilizers for and on behalf of the appellant in consideration of receiving a commission of 31/2% calculated on the net realisable value, i. e., upon the gross sales realisation less excise duty and sales tax, freight expenses and discount and rebate. This commission is the remuneration paid by the appellant to the selling agents for discharging the obligation of the selling agents under the agreement of selling the fertilisers. In the absence of any such agreement the appellant would have been obliged to carry on the activity of organising the sales of its products on its own.

6. The Central Government issued a notification bearing No. 25/70 dated 1-3-1970 which reads as follows :-

"In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts mixed fertilisers, falling under item No. 14-HH of the first Schedule to the Central Excises and Salt Act, 1944 (1 of 1944) manufactured with the aid of power, from two or more fertilisers on all of which the appropriate amount of the duty of excise or as the case may be, the additional duty under Section 2-A of the Indian Tarrif Act, 1934 (32 of 1934), has already been paid, from the whole of the duty of excise leviable thereon.

Explanation : For the purpose of this notification, the term mixed fertilisers means mixtures of fertilisers containing more than one nutrient (nitroge