V.T. Raghavachari, Member (J)

1. All these appeals are being disposed of under this common order since the issues involved in the main are common, though there are certain factual differences which will be noticed at the appropriate stage. For purpose of convenience the appellants, though in different appeals, shall be referred to in this order as appellants 1 to 5 respectively.

2. All the appellants were engaged during the relevant period in the processing of either cotton fabrics or man-made fabrics or both. To be very specific, appellants 2 and 4 were processing man-made fabrics, appellant 5 cotton fabrics only and appellants 1 and 3 both types of fabrics. In about the middle of June 1984 the Central Excise officers visited these factories and subsequently show cause notices were issued to all the appellants charging them that they had processed and removed the fabrics abovesaid without obtaining licence and without payment of duty though they were not entitled to do so on and after 24-11-1979. The reason was that on and after that date the benefit of exemption Notification No. 297/79 (in respect of man-made fabrics) and Notification No. SO/76 (in respect of cotton fabrics) was not available insofar as the appellants had carried out within the same factory certain processes other than the processes specified in the tables appended to the notifications. After receipt of reply and on adjudication the Collector of Central Excise, New Delhi in four cases and the Additional Collector, New Delhi in one case under separate orders, held the charges established and confiscated the seized goods giving an option for redemption on payment of fine as indicated in the respective orders; demanded central excise duty and handloom cess as indicated in the several orders and also imposed penalties. These appeals are against the said orders.

3. As earlier mentioned, all the appellants carried out the process of bleaching and dyeing. In addition, certain other processes, some with power and some without power, were being carried out by them in the same factory. Appellants 1, 2, 3 and 4 carried out the processes of calendaring with the aid of power and appellant 5 the process of hydro extraction with the aid of power. There is no dispute that, all the appellants would have been dis-entitled to the benefit of exemption under the respective notifications during the relevant period if the notifications are construed literally since they would have been carrying out certain other processes (other than the processes specified in the notifications) within the same factory.

4. The argument for the appellants is that if the words "within the factory" is strictly construed this would lead to discrimination since a person who erects a dividing wall in the same factory and carries out the different processes in the different sections would be free of duty, while the person carrying out all the processes within the same factory, but without a dividing wall, would be denied the exemption. We are unable to agree that the words of the notification should be so read as to avoid any such purported discrimination. The words are clear and a construction of the words as they stand does not lead to absurdity nor would it defeat the intention behind the notification. In the circumstances we are unable to accept the argument that we must interpret the words in the manner suggested for the appellants. The meaning of the term "factory" is not so fragile that if walls are erected dividing different sections of the same factory, all those sections would cease to be parts of the said factory. Anyway there was no such wall in any of the cases before us and it is unnecessary to go into this argument further.

5. Another argument is that the words in the proviso to the notification should be so read that it was only when dutiable goods were further processed in the same factory that exemption should be denied, or that dutiable processes other than the processes specified in t