JUDGMENT

B.P. Jeevan Reddy, J.

1. Tariff Item 38 of the First Schedule to the Central Excises and Salt Act, 1944 levied duty upon matches. With a view to encourage the production of matches in the non-mechanised sector, the Government of India have been issuing exemption notifications from time to time. Under Notification No. 162 of 1967 dated 27-7-1967, a distinction was made even among the non-mechanised units, with reference to their output. Smaller units were given a more beneficial rate of duty. In 1975 another notification (No. 154 of 1975) was issued broadly reiterating the aforesaid scheme and providing some additional concession to smaller units.

2. On 19-6-1980, two notifications were issued being Notification No. 98 of 1980 and Notification No. 99 of 1980. Notification No. 98 of 1980 levied duty on matches produced in the mechanised sector at Rs 7.20p while in the case of matches produced in non-mechanised sector the duty was Rs 4.50p. By Notification No. 99 of 1980, a further distinction was made among the units in non-mechanised sector. Factories "recommended by the Khadi and Village Industries Commission for exemption under this notification as a bona fide cottage unit"