J. M. SHELAT, J. ( 1 ) TWO common questions arise in this and the following petitions Nos. 752 of 1961 1054 of 1963 639 of 1963 and 917 of 1963 and therefore it would be expedient to have them disposed of together. In the last three petitions Nos. 10545 of 1963 633 of 1953 and 917 of 1963 however some additional questions are raised and therefore they will have to be dealt with separately. The two questions that are common to all these petitions are (1) whether the petitioners are manufactures of cotton fabrics as defined in the Central Excises and Salt Act 1944 and the rules made thereunder and (2) even if they are so whether the cotton fabrics in question which they are said to have manufactured or got manufactured attract the provisions of rules 7 and 9 of those rules or whether they enjoy exemption granted under the notifications issued by the Central Government under rule 8 of those rules. No. 751 of 1961. ( 2 ) IN this petition we are concerned with Tarun Trading Co. a proprietory concern carrying on business as wholesale dealers in cotton textiles and of which the petitioner is the sole proprietor. According to the petition an oral agreement was arrived at between the Ankleshwar Handloom Weavers Co-operative Purchaser Society Ltd. Ankelshwar (hereinafter referred to as the society) whereunder the society agreed to supply power-loom cloth according to the varieties required by the petitioner. Under the agreement it was agreed that the petitioner should pay the cost for yarn which the society would purchase from Messrs Manoj Textile Mills such payments being on behalf of the society and the society was to supply cloth to the petitioner by adding to the cost of the yarn what in the petition are called manufacturing charges which included reasonable profits of the society. These charges were Rs. 0-2-3 Rs. 0-2-9 and Rs. 0-3-3 per yard depending upon which of the three varieties bearing Nos. 4055 6052 and 7060 was made and sold to the petitioner by the society. ( 3 ) BETWEEN September 12 1960 and December 31 1960 the society supplied 71 638 linear yards of power-loom cloth of the total value of Rs. 55 781 to the petitioner. 0-3-3 per yard depending upon which of the three varieties bearing Nos. 4055 6052 and 7060 was made and sold to the petitioner by the society. ( 3 ) BETWEEN September 12 1960 and December 31 1960 the society supplied 71 638 linear yards of power-loom cloth of the total value of Rs. 55 781 to the petitioner. This cloth as aforesaid was manufactured out of yarn purchased from Messrs Manoj Textile Mills and for which the price as alleged in the petition was paid by the petitioner on behalf of the society. According to the petition the petitioner was the purchaser of the goods and it was the society which was the manufacturer. The society being a co-operative society was exempt from payment of excise duty under the notification dated April 30 1960 issued by the Central Government under rule 8 and it was the case of the petitioner that no duty was recoverable on the said goods sold by the society and purchased by him. ( 4 ) THE society was registered in February 1948 under the Bombay Co-operative Societies Act 1925 and was composed of members who were the owners of power-looms. The practice followed by the society was that the society would collect orders then supply yarn to its members and the members would manufacture cloth out of such yarn on their looms employing in their turn weavers to whom they would pay weaving charges. The society in its turn would pay to its members weaving charges. The society then would sell the cloth so manufactured at rates fixed after taking into account the weaving charges paid by it to its members certain administrative expenses and other charges such as packing transport etc. and reasonable profits. The petitioners case was that the bills of sale issued by the society came to Rs. 55 781 which included the cost of yarn purchased by the society from Messrs Manoj Textile Mills together with weaving charges other charges and profits all of which were valued in the rates above mentioned though in fact the petitioner had already paid to Messrs Manoj Textile Mills the price of the yarn on behalf of the society. 55 781 which included the cost of yarn purchased by the society from Messrs Manoj Textile Mills together with weaving charges other charges and profits all of which were valued in the rates above mentioned though in fact the petitioner had already paid to Messrs Manoj Textile Mills the price of the yarn on behalf of the society. ( 5 ) IT would seem that the excise authorities started investigation into transactions of this kind entered into by such societies and in the course of their investigation they recorded on January 25 1961 the statement of Indravadan Ishwarlal Shah who gave his statement on behalf of the petitioner who was said to be out of Ahmedabad at the time. On or about January 29 1961 the petitioner confirmed that statement stating that Indravadan Shah was authorised by him to make that statement and that he would abide by it. On May 10 1961 the Department issued a show cause notice why duty amounting to Rs. 34 727 np. and penalty should not be recovered from the petitioner under rule 9 (2) of the said rules. On May 19 1961 the petitioner gave his written explanation and after a personal hearing was given to him the Deputy Collector Central Excise the respondent herein passed his order dated September 11 1961 calling upon the Petitioner to pay Rs. 34 727 np. as duty and a penalty of Rs. 750/in respect of the said cotton fabrics supplied as aforesaid by the society to the petitioner. ( 6 ) IT is an admitted fact that Messrs Manoj Textile Mills consisted of four partners namely the said Indravadan Shah and his three brothers and that Vijay Trading Co. which is the petitioner in Petition No. 752 of 1961 consisted of two partners namely the said Indravadan Shah and his brother. It is not in dispute that the said Indravadan Shah principally managed the two concerns. It is also an admitted fact that Tarun Trading Co. and Vijay Trading Co. carried on business in the same premises and that the said Indravadan Shah used to manage the business of Tarun Trading Co. in the absence of its proprietor. The interest taken by Indravadan Shah in Tarun Trading Co. was such that as observed above he was even authorised to make a statement on behalf of Tarun Trading Co. carried on business in the same premises and that the said Indravadan Shah used to manage the business of Tarun Trading Co. in the absence of its proprietor. The interest taken by Indravadan Shah in Tarun Trading Co. was such that as observed above he was even authorised to make a statement on behalf of Tarun Trading Co. though as the endorsement of its proprietor Jamnadas Desai shows he was absent only at the most for about four days. Therefore when the Department asked for a statement Indravadan Shah could well have told them that the proprietor was absent and that if the Department desired any statement it could be recorded Oil his arrival. But as already seen he did not do so and presumably because he was conversant with the transactions in question he did not wait for the arrival of the proprietor and gave his statement on behalf of Tarun Trading Co. These facts indicate that there was justification in the contention of the learned Advocate General that Indravadan Shah to say the least took considerable interest in the transactions of the petitioner. This conclusion is also reflected in the statement of account furnished to the Department by Tarun Trading Co. That statement shows that a sum of Rs. 17 39 paid by Vijay Trading Co. to or on behalf of the society was adjusted by means of a havala entry dated October 31 1960 by crediting that amount to Tarun Trading Co. against the sum of Rs. 55 781 np. being the sale price of the goods supplied by the society to Tarun Trading Co. and allegedly due to the society. There is therefore force in the contention that these three concerns had common interest with each other and Indravadan Shah if not actually managing them all had interest in at least two of them and was taking part in the management of the third namely Tarun Trading Co. According to the statement of account produced before the respondent Rs. 39 245 np. only were paid against the sale price of Rs. 55 781 np. between October 31 1960 and December 31 1960 Out of the amount of Rs. 39 245 Rs. 17 39 np. were credited to Tarun Trading Co. by means of an adjustment entry. The balance of Rs. 39 245 np. only were paid against the sale price of Rs. 55 781 np. between October 31 1960 and December 31 1960 Out of the amount of Rs. 39 245 Rs. 17 39 np. were credited to Tarun Trading Co. by means of an adjustment entry. The balance of Rs. 22 0 and odd was not directly paid to the society as seen from the statement of account dated November 12 1960 produced by Indravadan Shah along with a letter dated November 19 1960 admittedly written by him on behalf of Tarun Trading Co. to the society. That statement shows that in respect of 47 432 yards of cloth supplied to the petitioner the petitioner had paid only Rs. 8 155 np. directly to the society and the rest were paid presumably as the price of the yarn to Manoj Textile Mills. This is clear from the letter of Indravadan Shah dated November 19 1960 to the society. That letter is somewhat important otherwise also for it directed the society to credit to the petitioner the amount stated therein and said to have been paid to Messrs Manoj Textile Mills for the yarn and wound up by stating that the petitioner would go to Ankleshwar and personally talk over the matter to the manager of the society. This letter together with the statement enclosed therewith dated November 12 1960 clearly shows that it Was Indravadan Shah who was really managing Tarun Trading Co. and not merely looking after that concern in a friendly way in the absence of its proprietor and since he was also a partner together with his brothers in the other two concerns it can safely be presumed that it was he who was managing all the three concerns. It was presumably because of this circumstance that on January 25 1961 it was Indravadan Shah and not the petitioner who gave the statement to the Department which was subsequently adopted by the petitioner on January 29 1961 ( 7 ) THIS statement contained certain facts which would appear to negative the case of the petitioner as laid in the petition. The first thing that is stated there is that the petitioner company got manufactured the cotton fabrics in question. The first thing that is stated there is that the petitioner company got manufactured the cotton fabrics in question. Secondly it is also clearly stated there that the petitioner company paid to the society only the labour charges and further that these amounts paid as and by way of labour charges more or less corresponded to the labour cost of the society which means that they corresponded to the labour charges paid by the society to its members. The statement admits that beyond these labour charges no other direct payments were made to the society for the price of the yarn was paid by Tarun Trading Co. by means of cheques which though drawn in favour of the society were endorsed by the society in favour of Manoj Textile Mills. This practice was followed apparently to show that it was the society which used to purchase yarn and was entitled to include the cost of the yarn in the price of cloth payable by the petitioner company. This position is clear from the statement of Indravadan Shah that the society used to issue formal bills including therein the price of the yarn though it was Tarun Trading Co. which used to pay for the yard. ( 8 ) TWO facts thus emerge from the statement of Indravadan Shah dated January 25 1961 the aforesaid letter and the statement of account respectively dated November 19 and November 12 1950 and admittedly written by him namely (1) that under the agreement between the petitioner and the society the petitioner company was to supply yarn to the society and (2) that the petitioner company was to pay to the society labour charges at the aforesaid rates agreed to between them. The case of the petitioner that the aforesaid rates represented manufacturing cost and not merely the labour charges is negatived by the admission in the statement of Indravadan Shah that these charges more or less corresponded to the labour cost paid by the society to its members. It would seem that it was because of the facts that Indravadan Shah had to admit in his statement that the cotton fabrics in question were got manufactured by the petitioner company. It would seem that it was because of the facts that Indravadan Shah had to admit in his statement that the cotton fabrics in question were got manufactured by the petitioner company. Prima facie therefore apart from the question whether the petitioner in law could be said to be the manufacturer it was the petitioner who got the goods manufactured supplying yarn to the society and paying to the society only the weaving charges. The statement of account dated November 12 1953 sent by Indravadan Shah along with his letter dated November 19 1960 to the society also shows that besides the labour charges namely Rs. 8 155 np. a further sum of Rs. 172/was paid to the society and it was admitted before us that that amount represented packing charges. This fact though by itself a small circumstance shows that charges other than labour charges were not included in the rates agreed to between the petitioner and the society and that the society was paid charges such as packing charges separately and therefore the aforesaid rates cannot be said to represent manufacturing charges as the petitioner sought to make out. The statement of Indravadan Shah thus clearly establishes that the petitioner company got the cotton fabrics in question manufactured by the society by supplying yarn and paying to the society only the weaving charges. But to make out that it purchased the goods from the society bills were made out which included the price of the yarn accounts were also likewise prepared showing as if the cost of the yarn was included in these bills and cheques were drawn in favour of the society and endorsed in favour of Messrs Manoj Textile Mills in which Indravadan Shah and his three brothers were partners. ( 9 ) THE first contention raised by the petitioner was that the cotton fabrics in question were not liable to the duty as they were exempt from such duty under notification No. 70 of 1950 dated April 30 1960 Before we proceed to deal with this contention it will be necessary first to consider the relevant provisions of the Act and the rules. Clause (d) of section 2 of the Act defines excisable goods as meaning goods specified in the First Schedule as being subject to a duty of excise. Clause (d) of section 2 of the Act defines excisable goods as meaning goods specified in the First Schedule as being subject to a duty of excise. Item 19 in the First Schedule provides for excise duty at different rates depending upon the variety of cotton fabrics. Cotton fabrics therefore are excisable goods within the meaning of the definition of excisable goods in section 2 (d ). Section 3 which is the charging section provides for the levy and collection of duties specified in the First Schedule on all excisable goods which are produced or manufactured in India. Rule 7 deals with recovery of duty and provides that every person who produces cures or manufactures any excisable goods or who stores such goods in a warehouse shall pay duty or duties leviable on such goods at such time and place and to such person as may be designated in or under the authority of these rules whether the payment of such duty or duties is secured by bond or otherwise. Rule 8 empowers the Central Government to authorise exemption from duty in certain cases from the whole or any part of the duty payable on such goods. The rule therefore postulates that the goods to be exempted are excisable goods in the first instance. Thus cotton fabrics are excisable goods on which duty is payable at the rates prescribed in tariff item 19. Clause (1) of rule 9 provides that no excisable goods shall be removed from any place where they are produced cured or manufactured or any premises appurtenant thereto which may be specified by the Collector in this behalf whether for consumption export or manufacture of any other commodity in or outside such place until the excise duty leviable thereon has been paid at such place and in such manner as is prescribed in these rules or as the Collector may require and except on presentation of an application in the proper form and on obtaining the permission of the proper officer on the form. Clause (2) of that rule provides that if any excisable goods are in contravention of sub-rule (1) deposited in or removed from any place specified therein the producer or manufacturer thereof shall pay the duty leviable on such goods upon written demand made by the proper officer whether such demand is delivered personally to him or is left at his dwelling house and shall also be liable to a penalty which may extend to two thousand rupees and such goods shall be liable to confiscation Rule 9a provides that the rate of duty and the tariff valuation (if any) applicable to goods cleared on payment of duty shall be at the rate and valuation (if any) in force on the date on which duty is paid or if the goods are cleared from a factory or a warehouse on the date of the actual removal of such goods from such factory or warehouse. ( 10 ) IN pursuance of the power under rule 8 the Central Government issued notifications from time to time granting exemptions on cotton fabrics though such goods are excisable goods under tariff item 19. Though the notification relevant to the goods in question is notification No. 70 of 1960 dated April 30 1960 it would become necessary in view of the arguments advanced before us to glance at the previous notifications issued by the Central Government. The first relevant notification is the one dated January 5 1957 which exempted cotton fabrics described therein from the whole of the duty leviable thereunder the Act. The notification exempted seven kinds of goods out of which we are concerned with the seventh item dealing with cotton fabrics manufactured by and on behalf of the same person in one or more factories commonly known as power-looms (without spinning plants) in which less than five power-looms in all are installed. Thus. cotton fabrics manufactured by a person in a place where less than five power-looms are installed as well as cotton fabrics manufactured on behalf of such a person again in a place where less than five power-looms are installed were exempted from duty. Item 7 of this notification shows that for the purpose of claiming exemption it was not necessary that a person who manufactured cotton fabrics need be an owner of power-looms. Item 7 of this notification shows that for the purpose of claiming exemption it was not necessary that a person who manufactured cotton fabrics need be an owner of power-looms. The only condition required was that the goods should be manufactured at a place where less than five power-looms were installed. It was also not necessary that he must himself manufacture the goods and it was sufficient if they were manufactured on his behalf. In both the cases that person whether he himself manufactured or got the goods manufactured on his behalf would be the manufacturer. It would seem that the object of granting the exemption was to benefit or give protection to a small manufacturer as against a big manufacturer and to equalise him as against manufacturers having large scale factories and establishments with the advantages attendant upon mass production. This notification dated January 5 1957 which gave benefit of exemption to individual manufacturers provided the goods manufactured by them were manufactured in factories which worked less than five power-looms is still in force and has not been superseded by any subsequent notification. The next notification which is relevant for our purposes is notification No. 74 of 1959 issued on July 31 1959 and which provided that the Central Government thereby exempted cotton fabrics produced by any co-operative society formed of owners of cotton power-looms which was registered or which might be registered on or before March 31 1961 under any law relating to co-operative societies from the whole of the duty leviable thereon subject to the four conditions therein set out. These conditions were (a) that every member of the co-operative society was exempt from excise duty for three years immediately preceding the date of his joining such society (b) that the total number of cotton power-looms owned by the co-operative society was not more than four times the members forming such society (c) that a certificate was produced by each member of the co-operative society from the State Government concerned or such officer as may be named by the State Government that he was a bona fide member of the society and that the number of cotton power-looms in his ownership and actually operated by him did not exceed four and did not exceed four at any time during the three years immediately preceding the date of his joining the society and that he would have been exempted from excise duty even if he had not joined the society and (d) that the exemption would be available (i) for a period ending on July 31 1962 in respect of registered co-operative societies which had commenced production prior to the date of this notification and (ii) for a period of three years from the date of commencement of production in respect of co-operative societies which had been registered but had not commenced production or which might be registered on or before March 31 1961 It can be seen that this notification made a departure from the last notification and the policy underlying it for it gave exemption for the first time to cotton fabrics manufactured by a cooperative society provided the society fulfilled the four conditions set out therein. The exemption however was restricted to cotton fabrics produced by a society whose members were owners of power-looms and who in their individual capacity were entitled under the previous notification to exemption The exemption thus was restricted to cotton fabrics produced by a society whose members were owners of power-looms. Since condition (c) laid down that the members must be such that they on their own account would be entitled to exemption even if they were not members of the society it is clear that they must be owners of looms and that the goods must be manufactured either by them or through labour hired by them but on behalf of the society. The notification did not supersede the earlier notification dated January 5 1957 under which as already stated an individual manufacturer whether he owned looms or not and whether he himself manufactured or got manufactured through others enjoyed exemption. Therefore whereas the goods produced by a society enjoy the exemption under this notification provided its members were owners of power-looms so far as an individual was concerned it was not necessary that he owned any power-loom. The intention underlying this notification was obviously to encourage formation of co-operative societies which not only produced cotton fabrics but which also consisted of members not only owning but having actually operated not more than four power-looms during the three years immediately preceding their having joined the society. The policy was that instead of each such member operating his looms on his own he should combine with others by forming a society which under their amalgamated co-operative effort should produce cloth. But the insistence was that the goods for which exemption could be claimed must be goods produced by the society. This is clear not only from the operative part but also from condition (d) under which the exemption was available for a prescribed period from the date of commencement of production by the society. ( 11 ) NOTIFICATION No. 70 of 1960 dated April 30 1960 superseded the notification dated July 31 1959 and in language no doubt different from the earlier notification provided that the Central Government exempted thereby cotton fabrics produced on power-looms owned by any co-operative society or owned by or allotted to the members of the society and which society was registered or which might be registered on or before March 31 1961 from the whole of the duty leviable thereon subject to the four conditions therein set out. As rightly urged by Mr. Nanavati this notification changed the language and used the expression produced on power-looms owned by a society or by its members or allotted to them instead of the expression produced by a society. Another change introduced in this notification was that whereas under the notification dated July 31 1959 the society had to be of members who were owners of and who had actually operated power-looms not exceeding four the present notification contemplates cotton fabrics produced on power-looms either owned by the society or its members or on looms allotted to such members. Another change introduced in this notification was that whereas under the notification dated July 31 1959 the society had to be of members who were owners of and who had actually operated power-looms not exceeding four the present notification contemplates cotton fabrics produced on power-looms either owned by the society or its members or on looms allotted to such members. Therefore it is not necessary as it was under the previous notification that the looms must be owned by the members. The members may be persons to whom looms were allotted. ( 12 ) THE contention that was urged by Mr. Nanavati as also by Mr. Divan and Mr. Sorabji who appeared for the petitioners in the subsequent petitions was that (1) the change of language in this notification was deliberate and not unintentional and (2) that the change was intended to widen the scope of the exemption with a view to foster co-operative societies and to encourage production on power-looms belonging to them or owned by the members or allotted to such members. Since the change in the language was deliberate the argument proceeded the exemption applied to all cotton fabrics which were produced on power-looms owned by the co-operative society or by its members or on power-looms allotted to such members and it was not relevant who produced or manufactured such fabrics whether it was the society itself or its members or even an outsider the object in making the change in the language being to see that the power-looms owned by the society or owned by its members or allotted to the members of such societies did not remain idle. It was argued and argued strenuously that this was the clear meaning of the words used in this notification and that where a statute or an order uses precise and unambiguous words accompanied by a deliberate change in the language from the one previously used a Court of law construing it cannot go behind the plain meaning of such words and try to find out the hidden intention of the draftsman by conjecture or speculation for the intention of the draftsman must be found from the very words used by him. Reliance was placed on a passage at page 67 in Craies on Statute Law Sixth Edition and the observations in Sri Ram Ram Narain Medhi and others v. State of Bombay. Reliance was placed on a passage at page 67 in Craies on Statute Law Sixth Edition and the observations in Sri Ram Ram Narain Medhi and others v. State of Bombay. A. I. R. 1959 S. C. 459 Nalinakhya Bysack v. Shyam Sunder Haldar and others 1953 S. C. R. 533 and in particular the observations of Lord Simonds in Magor and St. Mallons Rural District Council v. New Ports Corporation 1952 A. C. 189 at page 191 in refuting the observations of Lord Denning. These decisions no doubt lay down the rule of construction with which no one can possibly have any quarrel. Nevertheless the notification under construction must be read as a whole and not by laying emphasis on certain words or sentences divorced from their context. Read in this manner the notification as the previous notification did lays down that the exemption granted thereunder is subject to the four conditions set out therein. Nevertheless the notification under construction must be read as a whole and not by laying emphasis on certain words or sentences divorced from their context. Read in this manner the notification as the previous notification did lays down that the exemption granted thereunder is subject to the four conditions set out therein. It will be observed that these four conditions are substantially in the same terms as those in the notification of July 31 1959 The notification as the earlier one did insists that (a) every member of the co-operative society has been a manufacturer of cotton fabrics on power-looms and further has been exempted from duty for three years immediately prior to his joining the society (b) that the total number of looms owned by the society or allotted to its members does not exceed four times the number of its members (c) that each member produced a certificate that the powerlooms owned by or allotted to him and actually operated by him do not exceed four and did not exceed four at any time during the three years immediately preceding his joining the society and (d) that the exemption is to be available (i) up to July 31 1962 for societies which have commenced production prior to the date of the notification and (ii) for three years from the date of the commencement of production in respect of societies which though registered have not commenced production or which may be registered on or before March 31 1961 These conditions in our view make it clear that in order to entitle a society to exemption it must be established that every one of its members has been a manufacturer and has been exempt for three years immediately prior to his becoming the member that he has owned or has been allotted power-looms not more than four and furthermore that he does not own and has not owned or allotted to him more than four looms at the relevant time i. e. at the date of claiming the exemption and lastly that the exemption is to operate for the prescribed period from the date of commencement of production obviously by the society. ( 13 ) NO doubt the language used in the present notification is somewhat different from that of the previous notification and Mr. Nanavati was right when he said that the change was deliberate. ( 13 ) NO doubt the language used in the present notification is somewhat different from that of the previous notification and Mr. Nanavati was right when he said that the change was deliberate. It would also perhaps be right to say that the change in the language was made to extend the scope of the exemption. But the question is what does that change amount to and why had the change in the language been necessitated ? Under the notification dated July 31 1959 the goods on which exemption could be claimed were those which were produced by a society formed of owners of power-looms each of whom under condition (a) therein was exempt from duty for three years immediately prior to his joining the society. Therefore the society envisaged in that notification was one whose members were owners of power-looms and who as such had been exempt individually from payment of duty for three years immediately before they joined the society. The society thus was one of which the members themselves were owners of looms who had been operating those looms individually and who had then formed the society. The exemption therefore instead of being given to them in their individual capacity was given to the society as they had combined their manufacturing efforts by forming a society. Under the present notification the society envisaged therein is a different type of society wider in concept than the society contemplated in the earlier notification for such a society can be one which owns its own looms or has members who own looms or who are allotted looms not exceeding four. Since the society now contemplated is one which owns its own looms or has members to whom power-looms are allotted it follows that the membership of such society need not be confined to these who are owners of power-looms Therefore the production of cotton fabrics which would enjoy exemption can be made both by members who are owners of powerlooms as also those who are not owners but to whom looms not more than four are allotted. The fact however that under clause (d) the exemption is made available for the prescribed period commencing from the date of production shows that the production that is contemplated is by the society and not by any outside agency. The fact however that under clause (d) the exemption is made available for the prescribed period commencing from the date of production shows that the production that is contemplated is by the society and not by any outside agency. Since the notification recognises a society which has members to whom looms are allotted and such a society need not be one whose members can be only those who own looms the goods produced on such looms could not be said to be goods produced by a society formed of owners of looms as in the case of the notification dated July 31 1959 As the scope of the society recognised by the notification was widened and included societies which themselves owned looms and whose members need not be owners but could be those to whom looms were allotted a change in the language had to be made. Such a society the goods produced by which are now exempted could not be said to be one whose members were owners. Since the goods which are to be exempted are goods produced on looms either owned by a society or its members or allotted to its members the expression goods produced on power-looms had to be substituted for the words goods produced by a society formed of owners of looms. But the change would not mean as suggested by the petitioners that the looms could be exploited by outside agencies. This is clear from the conditions subject to which the exemption is made available and the fact that the very same conditions which were part of the earlier notification were retained is somewhat significant for the society which claims exemption must have members who have themselves been manufacturers and have enjoyed the exemption in their own right under the notification of January 5 1957 who do not own and have not owned more than four looms or to whom not more then four looms are allotted. Furtheremore the exemption is to be available for the prescribed period from the date of production which must of necessity be production by the society through its members and not by outsiders. The construction suggested by the petitioners would not only be contrary to the notification read as a whole but would in our opinion defeat the very purpose and the object of granting the exemption. The construction suggested by the petitioners would not only be contrary to the notification read as a whole but would in our opinion defeat the very purpose and the object of granting the exemption. This conclusion is to a certain extent supported by certain observations made by the Supreme Court in Orient Weaving Mills (P) Ltd. and others v. Union of India and others A. I. R. 1963 S. C. 98 where the Supreme Court was called upon to decide the question whether these very notifications suffered from invalidity on account of their being violative of Article 14 and Article 19 (1 ). While examining that question the Supreme Court considered the object and purpose of the exemption and the class of producers intended to be benefited thereunder. The Supreme Court observed that the exemption granted by these notifications was meant primarily for the protection of petty producers of cotton fabrics not owning more than four power-looms from unreasonable competition by big producers. The State therefore had made a valid classification between goods produced in big establishments and similar goods produced by small power-loom weavers in the mofussil who were usually ignorant illiterate and poor and suffered from handicaps to which big establishments were not subject. Under the notifications exemption was available to individual weavers who employed not more than five looms on their own account. The fact that they had banded together in a co-operative effort to increase their efficiency and to take advantage of State aid should I not count against them. In rule 8 therefore there has not been excessive delegation of power to exempt. Nor were the notifications bad in so far as they exempted certain classes of persons and not classes of goods from the excise duty. The duty of excise was on the production of any goods but it was payable by persons producing such goods. The assumption Was also with reference to such goods as came within the description of excisable goods. Certain co-operative societies had been exempted under the notifications from payment of excise duty in respect of goods produced by the weavers. They had not been exempted from the payment of a personal tax like income tax. The exemption therefore had reference to the same kind of tax which would otherwise have been leviable but for the exemption. Certain co-operative societies had been exempted under the notifications from payment of excise duty in respect of goods produced by the weavers. They had not been exempted from the payment of a personal tax like income tax. The exemption therefore had reference to the same kind of tax which would otherwise have been leviable but for the exemption. Condition (c) in the notification under discussion clearly contemplates that looms might have been allotted to a person even before he became a member of a society. The production by such a member would not be production on the looms owned either by him or the society and therefore the words allotted to him had to by added. It is true that unlike the notification dated July 31 1959 the words are on the power-looms and not by the society but the conditions show that the members of such society have been themselves manufactures who own or are allotted looms and have enjoyed the exemption and furthermore the exemption is made available for a certain period from the date when the society commenced its production. All these factors show that the exemption is in respect of goods produced by the society through its members either on power-looms belonging to the society or belonging to the members or on looms allotted to such members. ( 14 ) BUT it was argued that if this construction were adopted it would mean that a society which has not the means to purchase raw materials. such as yarn and therefore agrees to take such raw materials from a producer would be debarred from the benefit of the exemption and that such a result would be contrary to the very object of the notification and furthermore would amount to substituting the words produced on powerlooms by the words produced by the society. The argument in our view suffers from fallacy for even where a society is furnished with raw materials in the circumstances assumed in such a case if it is established that it was the society which produced the goods and not some outsider. the exemption would still be available. The argument in our view suffers from fallacy for even where a society is furnished with raw materials in the circumstances assumed in such a case if it is established that it was the society which produced the goods and not some outsider. the exemption would still be available. It would on the contrary be defeating the very purpose of the notification if it were to be held that even if some outsider were to exploit the looms of the society and produce cloth the exemption would be available so long as such goods were manufactured on looms belonging to a society or to its members or on looms allotted to its members. Considering the notification in its entirety and without attempting to conjecture or speculate about the object for which it was issued or without attempting any modification in the language used therein it is clear that as compared with the previous notification the scope of exemption was enlarged so as to give the benefit of the exemption to goods produced by a society through its members though the members were themselves not the owners of looms on which the goods were produced and the looms on which they were manufactured were looms either owned by the society itself or by its members or were looms allotted to its members. Since under the notification of January 5 1957 an individual could claim exemption on goods manufactured by him or on his behalf even though he might not be the owner of the looms on which such goods were manufactured there was no reason why the exemption on the same lines should not be given to a society consisting of members who did not own looms but to whom looms were allotted. Under the notification of July 31 1959 such a society whose members were not the owners but who produced cotton fabrics on looms allotted to them could not claim exemption though the members if they had not joined such a society could have claimed exemption on goods manufactured by them under the notification dated January 5 1957 It was with a view to do away with this anomaly and to widen the scope of societies who could claim exemption that the present notification was issued. The extension of the exemption necessitated change in the first part of the notification for cotton fabrics manufactured by a member on looms allotted to him but not owned by the society could not be said to have been produced by the society. To include such goods for the purpose of exemption to be available to the society the language used in the previous notification would have been inapt and therefore had to be changed. But the emphasis still was notwithstanding the change in the language that the production must be by the society through its members on looms either owned by the society or its members or on looms allotted to such members. In this view cotton fabrics Which are produced or manufactured by an outsider i. e. neither by a society nor by the members of such society cannot enjoy the exemption and would be liable to duty as prescribed under tarrif item 19 in the First Schedule to the Act and would attract rule 7 of the rules. ( 15 ) AT one stage Mr. Sorabji who appears for the petitioners in the two petitions after these two petitions argued that since the notification provides for an exemption though the general rule is that fiscal statutes should be strictly construed the provisions regarding exemption should be liberally construed and in favour of the subject and that if the court felt that there was any ambiguity in the language used in the notification the benefit of such ambiguity should go to the subject. The authorities cited before us both by Mr. Sorabji and the learned Advocate General would seem to show that different views have been held by different Courts. We however need not enter into that controversy as we hold on the language of the notification itself that the exemption given thereunder applies to goods manufactured or produced by the society through its members on looms either owned by the society or its members or those allotted to such members and not in the case of goods manufactured or got manufactured by outsiders. ( 16 ) THE next question that falls for determination is whether rule 7 under which the duty is to be recovered applies to the petitioner. ( 16 ) THE next question that falls for determination is whether rule 7 under which the duty is to be recovered applies to the petitioner. Since that rule can only apply to one who produces and manufactures any excisable goods or who stores such goods in a warehouse it will have to be considered whether the petitioner can be said to be either a producer or a manufacturer of the cotton fabrics in question. ( 17 ) SECTION 2 (f) does not define the words manufacture or manufacturer but lays down an inclusive definition. What the Legislature does is to say that to manufacture means not only what its natural meaning conveys but shall also include any process incidental or ancillary to the completion of a manufactured product. So far as salt and tobacco are concerned the Legislature includes various processes set out separately therein. Therefore one has first to turn to the natural and plain meaning of the word manufacture to find out the content of this definition. The natural meaning of manufacture is to make or fabricate or to bring into existence an article or a product either by physical labour or by power. Therefore leaving aside salt and tobacco the definition of the word manufacture would mean making or bringing into existence an article or product by physical labour or power and would include any process incidental or ancillary to the completion of a manufactured product. The definition then lays down that the word manufacturer shall be construed accordingly which means that a person would be a manufacturer who makes fabricates or brings into existence a product or an article by physical labour or power including a process incidental or ancillary to the completion of such a manufactured product. The definition then goes a step further and provides that a manufacturer shall include not only a person who employs hired labour in the production or manufacture of goods but also any one who engages in the production or manufacture on his own account if those goods are intended for sale. There can be no doubt that from the use of such words as not only and but also the Legislature desired to make the definition as comprehensive as possible. There can be no doubt that from the use of such words as not only and but also the Legislature desired to make the definition as comprehensive as possible. That is also clear from the latter part of the definition where it is provided that even a person who engage himself in the production manufacture shall also be a manufacturer for the purposes of this Act. The word engage according to its dictionary meaning means to employ to occupy oneself or to embark upon any business and thus has a wider connotation. than the word manufacture. The words not only and but also are used to emphasize the intention of the Legislature to include in the definition those who engage themselves in the production or manufacture on their account of goods intended for sale. ( 18 ) THE contention of Mr. Nanavati as also of Mr. Divan and Mr. Sorabji who supported him was two-fold. They urged first that the petitioners cannot be said to be manufacturers because they did not manufacture the goods in question but that the societies which brought the goods into existence would be the manufacturers. Secondly they urged that they had not employed the societies to manufacture these goods but that the societies were in the position of independent contractors over whom they had no control or over whom they had no right of supervision and therefore they cannot be said to be persons who had employed hired labour nor can they be said to have engaged themselves in the production or manufacture of the goods in question. The argument was that what the petitioners did was to enter into agreements with these societies whereunder the societies manufactured these goods through their members and to whom the societies paid weaving charges and they in their turn paid to the societies at the rates agreed to between them and the societies. In this connection Mr. Nanavati relied on two decisions in Chintaman Rao and another v. State of Madhya Bharat A. I. R. 1958 S. C. 388 and Shanker Balaji Wage v. The State of Maharashtra A. I. R. 1962 S. C. 517 both of which were cases of bidi manufacturers arising under the Factories Act and where the Supreme Court has laid down the distinction between an employee and an independent contractor. On the strength of these two decisions it was argued that the petitioner cannot be said to be an employer and the society or its members employees that there was no contract of employment between them and that at best the agreement between them made the society an independent contractor who upon an order placed with it manufactured the goods in question. Mr. Divan while supporting Mr. Nanavati approached the definition of manufacturer in a somewhat different way and urged that we should read the definition as if it provided that a manufacturer shall be construed accordingly and shall in so construing include a person who engages in the production or manufacture etc. Mr. Sorabji argued that the expression who employs hired labour which means labour employed on certain wages is used as a contra distinction of entrustment of work to an agent or an independent contractor and therefore in a case where there is an agreement whereunder a person engages an independent contractor to produce goods such a person cannot be said to be a manufacturer either in the natural meaning of that word or in its inclusive sense. It was urged that the word employs used in this connection must bear the same meaning usually given to it in law and must mean a person who employs labour on wages and that therefore there must be a contract of employment between the petitioner and the society in order to make the petitioner a manufacturer. ( 19 ) THERE can be no quarrel with the principles laid down in the two decisions cited by Mr. Nanavati which distinguish a servant or an employee from an independent contractor. Equally there can be no doubt that in the present case it would not be possible to say that there was any contract of service or employment between the petitioner and the society. But the question is does that fact mean that the petitioner is not a manufacturer and does not fall within the ambit of the definition? ( 20 ) AT one stage we were inclined to take the view that the Legislature laid down different categories of persons who would be manufacturers within the meaning of this clause namely:- (1) A person who manufactures i. e. brings into existence a product or an article either by himself or through his agent or servants. ( 20 ) AT one stage we were inclined to take the view that the Legislature laid down different categories of persons who would be manufacturers within the meaning of this clause namely:- (1) A person who manufactures i. e. brings into existence a product or an article either by himself or through his agent or servants. (2) A person who employs hired labour which expression would include an independent contractor who himself hires labour. And (3) A person who though not falling under either of these categories engages himself otherwise in the production or manufacture of the goods in question. But on a fuller consideration of the definition it appears that such a threefold classification would not perhaps be correct. As pointed out by the learned Advocate General by the words not only used by the Legislature while defining a manufacturer the Legislature lays down two categories of persons who would fall within the ambit of the definition namely (1) those who would be manufacturers within the natural meaning of the term manufacturer and (2) those who would fall in the inclusive part of the definition where the Legislature has given an inclusive and an enlarged definition. It is clear that the Legislature was not content by making merely those persons who on a plain meaning of the term can be called manufacturers and therefore by using the words but also an expression of emphasis wanted to include those persons who engaged themselves in the production or manufacture of goods on their own account and which goods were intended for sale. In the first category would fall all those persons who bring about into existence or make or fabricate an article or a product but a manufacturer in that sense does not only mean one who by his own personal labour makes an article or a product. A person who brings into existence an article or a product through the instrumentality of an agent or a servant must also be regarded as a manufacturer falling within the natural meaning of the word manufacturer. An artisan for instance who makes a product or an article is a manufacturer but does not cease to be one because he makes such an article with the aid of or through the instrumentality of his servants or workmen. An artisan for instance who makes a product or an article is a manufacturer but does not cease to be one because he makes such an article with the aid of or through the instrumentality of his servants or workmen. The legislature having thus provided for such a category of persons then proceeds to lay down the inclusive part of the definition and in doing so lays down that a manufacturer shall include not only one who employs hired labour but also one who engages in the production or manufacture etc. The words not only suggest that a person who employs hired labour meaning labour engaged or employed on hire as Mr. Sorabji suggested would be included in the first category. If that was not so and the Legislature wanted to classify persons employing hired labour separately it would not have used the expression not only but would instead have used a simple conjunctive and. The words not only used in that juxtaposition indicate that the draftsman thought that those who employed hired labour were covered by the first category and then the draftsman proceeded to lay down the inclusive part of the definition by emphasizing that not only but also those who engaged in the production etc. would be manufacturers. It is possible for a person who himself does not employ labour but gets goods manufactured through an independent contractor to say that he is not the manufacturer for he has not brought into existence an article or a product in question either himself or through his servants. To cover such a class of persons the Legislature provided the inclusive part of the definition which would include a person who does not himself employ labour but engages himself in the production or manufacture of goods though an independent contractor. In that view which appears to be the correct construction of the definition the petitioner would be a manufacturer within the meaning of sec. 2 (f ). . ( 21 ) BUT Mr. In that view which appears to be the correct construction of the definition the petitioner would be a manufacturer within the meaning of sec. 2 (f ). . ( 21 ) BUT Mr. Nanavati argued that the respondent has held the petitioner to be a manufacturer on the footing that he was a person who had employed hired labour that that part of the order is not correct in law for there was no contract of employment between the petitioner and the society and that the society was an independent contractor and therefore even on our construction of section 2 (f) the order would be bad as there was an apparent error of law in holding the petitioner a manufacturer liable to pay duty under rule 7. Considering the clear distinction in law between an employee and an independent contractor it would not be possible to say on the facts of this case that the society or its members were the employees of the petitioner and therefore it would not be correct to say that the petitioner manufactured the goods in question by employing hired labour and therefore would not fall in the first part of the definition. Nevertheless it cannot be doubted that by engaging the society as his independent contractor to weave cloth for him from the raw materials supplied by him and paying only weaving charges the petitioner did engage on his own account in the manufacture of goods intended for sale and therefore was a manufacturer. But it was argued that if the respondent has held the petitioner to be a manufacturer on one set of facts namely that he was a manufacturer because he had employed hired labour it would not be permissible to us to uphold that finding on the ground that he had engaged himself otherwise in the production of goods and that such a course would be tantamount to holding him a manufacturer on a different basis and on a different set of facts to which the respondent had not applied his mind. We do not think that this is a correct line of reasoning. We do not think that this is a correct line of reasoning. In the show cause notice the case of the Department clearly was that the petitioner had got manufactured these goods through the society and that allegation was based on the admission made by Indravadan Shah on behalf of the petitioner that the petitioner had got manufactured these goods through the society. It was with reference to this allegation that the petitioner gave his explanation and argued when he appeared before the respondent. At best therefore. the respondent can be said to have misconstrued the expression employs hired labour to mean that though the society was an independent contractor the petitioner had employed the society or its members. But it is not denied that the respondent acted with jurisdiction and it cannot also be denied that the respondent has held the petitioner to be a manufacturer in the sense that it was he who through the society brought into existence the goods in question. If therefore the authority has incorrectly mentioned in his order a portion of the section no prejudice is caused to the petitioner and the Court would not strike down such an order for that reason only. There is also no question of the authority having applied its mind to one set of facts and its order being upheld as correct on another set of facts. Reliance was placed on T. C. Basappa v. Nagappa and another A. I. R. 1954 S. C. 440 and on the basis of the observations contained therein it was argued that the order was passed in ignorance of law and should therefore be set aside. But the Supreme Court in A. M. Allison and another v. B. L. Sen and others A. I. R. 1957 S. C. 227 has laid down that proceedings by way of certiorari under Article 226 are not of course and the High Court has the power to refuse a writ if it is satisfied that there was no failure of justice and in appeals which are argued against the order of the High Court in applications under Article 226 the Supreme Court would refuse to interfere unless it was satisfied that the justice of the case required it but where it was not so satisfied it would not interfere. (See also P. Balakotaish v. Union of India and others A. I. R. 1958 S. C. 232 at 236 ). Both these decisions arose from cases under Article 226 for a writ of certiorari as in the present case. The Court therefore would look at the substance rather than mere form and if it finds that the order has been made with jurisdiction though there is an error in citing a particular part of the section the order falls under another part of the section and no prejudice is caused to the petitioner the Court would not interfere and set aside the order. It is obvious that the only mistake that the respondent can be said to have made was that instead of saying that the petitioner got manufactured the goods in question through an independent contractor namely the society he stated that the petitioner manufactured the goods by employing hired labour i. e. the society. The correct position was that by entering into an agreement with the society the petitioner had got the goods manufactured and thus had engaged himself in the production or manufacture of the goods in question but not by entering into a contract of employment with the society. The mistake therefore was to consider the petitioner as a manufacturer under the first category of persons rather than under the second category of persons fallin within the definition. But that does not mean as emphasized both by Mr. Nanavati and Mr. Sorabji that that finding was arrived at on a consideration of one set of facts and that that finding is sought to be upheld on another set of facts to which the authority had not applied its mind That contention cannot be sustained and our conclusion is that the authority was right in the finding that the petitioner was a manufacturer with the meaning of section 2 (f) of the Act. . . . . . . . . . . . . . . . . . . . . . . . . . . No. 1054 of 1963. ( 22 ) THE petitioner in this petition is the sole proprietor of Messrs. Gordhndas and Co. carrying on business as a dealer in textiles in Bombay. . . . . . . . . . . . . . . . . . . . . . . . . . . No. 1054 of 1963. ( 22 ) THE petitioner in this petition is the sole proprietor of Messrs. Gordhndas and Co. carrying on business as a dealer in textiles in Bombay. Under an agreement between the petitioner on the one hand and the Gandevi Vanat Udhyog Sahkari Mandli Ltd. (hereinafter referred to a the society) the society manufactured cotton fabrics during the period between June 1959 and September 1960 for the petitioner on certain term and conditions which were later reduced to writing on October 12 1959 Under these terms the society agreed to carry out weaving work on behalf of the petitioner on payment of weaving charges fixed at Rs. 00-19 np. per yard which included expenses the society would have to incur it transporting yarn from Bombay and cotton fabrics woven by the society to Bombay. The petitioner under these terms was to supply yarn to be delivered by him at Bombay to the society and the society was to make its own arrangement to bring the same to its factory at Gandevi. under clause 8 of the terms it was agreed that the society would weave cloth on fifteen powerlooms and the petitioner undertook to supply sufficient yarn to keep those looms running properly. Clause 11 provided that the yarn supplied by the petitioner remaining either in stock or in process or in the form of readymade pieces would be of the absolute ownership of the petitioner and the society as the bailee of the yarn undertook to take such care of it as it would normally take if the yarn belonged to it. The society also undertook to have the yarn insured against fire theft and all other risks including transit risks and further under took to reimburse the petitioner in case it failed to do so. The terms of the agreement though recorded on October 12 1959 were to be deemed to be effective as from April 21 1959 that being the date when the petitioner had sent four beams of yarn to the society and the agreement was terminable by either party by giving one months notice. The terms of the agreement though recorded on October 12 1959 were to be deemed to be effective as from April 21 1959 that being the date when the petitioner had sent four beams of yarn to the society and the agreement was terminable by either party by giving one months notice. The society was a co-operative society carrying on its work at Gandevi and was registered on or before May 31 1961 and consisted of members who owned power looms. The society started the weaving work for the petitioner some time in May-June 1959 and supplied to the petitioner between June 1 1959 and January 3 1961 cotton fabrics admeasuring 3 19 460 yards. The society had obtained L-4 licence as required by the Central Excise and Salt Act 1944 It is an admitted fact that the petitioner had never obtained such a licence. By letters dated August 29 1959 and October 27 1961 the Excise Department had granted and confirmed exemption from excise duty payable on cotton fabrics manufactured by the society under the notifications issued by the Central Government. It is not in dispute that between June 1 1959 and September 30 1959 the society carried out weaving work on four power-looms only though the Government had allotted to the society fifteen such power-looms but eleven out of the fifteen power-looms allotted as aforesaid were kept under seals and were consequently not worked. On or after September 30 1959 these eleven looms were released and the society was allowed to do its weaving work on all the fifteen power-looms allotted to it. On August 26 1961 the excise authorities recorded the statement of one Chelabhai Jivanji Vashi the manager of the society. In that statement Vashi admitted that as the society was not conversant with purchasing sized beams and the work of selling manufactured goods the society under the said agreement had undertaken to weave cloth for three concerns namely the petitioner Messrs. Virendra and Co. and Messrs. Ajit Processers all of Bombay the three concerned firms undertaking to supply cotton yarn to the society. He also conceded that the society used to weave cloth on payment of weaving charges and that it had entered into agreements with these three firms upon that basis. Virendra and Co. and Messrs. Ajit Processers all of Bombay the three concerned firms undertaking to supply cotton yarn to the society. He also conceded that the society used to weave cloth on payment of weaving charges and that it had entered into agreements with these three firms upon that basis. The society worked accordingly for the three firms until January 1961 and thereafter it started manufacturing cloth on its own and has continued since then the work of manufacturing cotton fabrics. On September 28 1961 the authorities recorded a further statement of Vashi in which again he conceded that the society had undertaken the work of manufacturing cotton fabrics on behalf of the aforesaid merchants of Bombay on payment of weaving charges and that the society had decided to do so until it became self-sufficient. He also stated that from May 1959 till September 1960 the society thus carried out weaving work of the petitioner on payment of weaving charges at the rate of Rs. 00-19 np. per yard and that from and after September 1960 to January 1961 the society carried on the work of the other two firms the petitioners in the following two petitions. On September 28 1961 the authorities also recorded the statement of one Narotamdas Vashanji Parekh the manager of the petitioner concern in which the manager also admitted that the petitioner had got Malmal of the width of fifty inches woven by the society on payment of Rs. 00-19 np. per yard as weaving charges and that in all the petitioner had got manufactured through the society 3 19 469 yards of Malmal. He also conceded that the petitioner had supplied the necessary yarn from Bombay and further that the aforesaid rate of Rs. 00-19 np. per yard included expenses for transporting the yarn from Bombay to Gandevi and for transporting the manufactured cloth from Gandevi to Bombay. The manager also admitted that the petitioner had not obtained L-4 licence for manufacturing cotton fabrics but stated that the petitioner had not done so as he was not aware that even if he got cotton fabrics woven at the societys factory he would be required to have such licence or that the petitioner would be liable to pay excise duty in respect of the cotton fabrics so got manufactured through the society. From the records of the society the authorities also found a joint resolution passed by the managing committee and the control committee of the society on November 17 1960 in which the said committees had clearly stated that the society was doing the work of certain merchants from Bombay on being paid weaving charges. The profit and loss account of the society for the year 1960-61 also indicated tha t the society had been doing two types of work (1) weaving work for other merchants on payment of labour charges and (2) the work of manufacturing cotton fabrics by the society itself. Thus it is clear that between June 1 1959 and January 3 1961 the society carried out the work of weaving from yarn belonging to and supplied by the petitioner in consideration of the petitioner agreeing to pay weaving charges at the rate of Rs. 00-19 np. per yard and that during the aforesaid period the society cleared 3 19 460 yards of cotton fabrics and transported them to the petitioner in Bombay. The society removed these goods and supplied them to the petitioner during the aforesaid period under bills a list of which is annexed as Exhibit I to the petition. The bills also indicate that these goods were cleared and delivered to the petitioner from June 5 1959 to January 3 1961 On these facts the authorities issued a show cause notice dated November 18 1961 and served the same upon the petitioner making a demand thereunder of a sum of Rs. 1 69 263 np. payable as excise duty. In the said notice under the heading of particulars of demand it was stated that the duty payable upon these goods was Rs. 1 69 263 np. and that the duty was payable by the petitioner as the petitioner had got the said goods manufactured through the society and had also got them removed from the societys factory at Gandevi without payment of duty. 1 69 263 np. and that the duty was payable by the petitioner as the petitioner had got the said goods manufactured through the society and had also got them removed from the societys factory at Gandevi without payment of duty. On January 10 1962 the Superintendent of Central Excises Bulsar sent another notice to show cause why penalty should not be imposed upon the petitioner for contravention of rule 9 of the said rules and why duty should not be charged for the cotton fabrics so removed and called upon the petitioner to produce at the time of showing cause all evidence upon which the petitioner intended to rely and to indicate in the written statement if he desired to be heard in person. Correspondence thereafter ensued between the petitioner and the authorities in consequence of which it would appear that the aforesaid show cause notices were cancelled and a fresh show cause notice dated April 16 1962 was served upon the petitioner. In this show cause notice it was stated that the petitioner had contravened the provisions of rule 9 inasmuch as he had cleared without payment of duty 3 19 469 yards of grey Malmal from the societys factory where they had been manufactured during the period from 1-6-59 to 31-1-61 and called upon the petitioner to show cause to the Assistant Collector of Central Excises and Customs Surat why penalty should not be imposed upon him for contravention of rule 9 and why duty amounting to Rs. 1 69 263 np. leviable on fabrics admeasuring 3 19 469 yards should not be recovered from him under rule 9. In the notice it was stated that the authorities would rely upon the agreement dated October 12 1959 the bills issued by the society from 1-6-59 to 31-1-61 the annual report and accounts of the year 1960-61 of the society the statements of Vashi and of the petitioners manager Narotamdas Parekh and the resolution referred to above dated November 17 1960 The show cause notice dated April 16 1962 was amended by a further notice dated April 23 1962 whereunder instead of the amount of Rs. 1 69 263 as the amount of duty payable on the said goods at the rate of 29. 3 np per yard the amount of Rs. 2 28 674 np. was demanded at the rate of basic duty at Rs. 00-45 np. 1 69 263 as the amount of duty payable on the said goods at the rate of 29. 3 np per yard the amount of Rs. 2 28 674 np. was demanded at the rate of basic duty at Rs. 00-45 np. in addition to an additional duty at the rate of 15. 5 np. and cess at 1. 09 np. per square meter. The additional amount was demanded as the rate of excise duty payable on cotton fabrics had been enhanced from 29. 3 np. per square meter to Rs. 00-45 np. per square meter as from April 22 1962 On May 7 1962 the petitioner gave his written statement in reply to the show cause notice and thereafter on August 11 1962 the petitioner was given a personal hearing at which he appeared by counsel and at which Vashi was examined. The impugned order was passed on November 26 1962 in which the Assistant Collector of Central Excises and Customs Surat found that the petitioner had operated and functioned as a manufacturer of the said goods and as such had removed them from the societys factory at Gandevi without payment of duty and ordered that the petitioner should pay as per the aforesaid demand the sum of Rs. 2 28 574 np. being the total amount of basic duty additional duty and cess on 3 66 305. 66 square meters of power-loom cotton fabrics at the rate of Rs. 00-45 np. 15. 5 np. and 1. 09 np. per square meter under rule 9 of the said rules and levied a penalty of Rs. 250 for contravention of rule 9. It is this order which has been challenged in this petition. ( 23 ) THE contentions raised by Mr. 00-45 np. 15. 5 np. and 1. 09 np. per square meter under rule 9 of the said rules and levied a penalty of Rs. 250 for contravention of rule 9. It is this order which has been challenged in this petition. ( 23 ) THE contentions raised by Mr. Sorabji on behalf of the petitioner were as follows:- (1) that the manufacturer of these goods on the facts stated above was the society and not the petitioner; (2) that the society being the manufacturer and in any event the goods in question having been admittedly produced on the power-looms allotted to the society the goods enjoyed exemption under the notification dated April 30 1960; (3) that the finding by the respondent that the petitioner had manufactured the goods by employing hired labour and was therefore a manufacturer was wrong in law because the agreement between the petitioner and the society was not a contract of employment which brought about the relationship of master and servant or an employer and an employee but was a contract of work and labour under which the petitioner supplied raw materials and the contractor i. e. the society produced the goods as in the case of a building contractor; (4) that the respondent having arrived at this finding on one set of facts and held on such set of facts the petitioner to be a manufacturer it would not be open to the Court to hold the petitioner a manufacturer on the ground that he would fall in the category of persons who are engaged in the production or manufacture of those goods i. e. on a different set of facts to which the authority had not applied its mind; (5) that in any event the impugned order was invalid as the liability to pay duty and penalty was sought to be imposed on the petitioner on the basis of the provisions of the Act and the rules which suffered from constitutional invalidity; and (6) that even if the petitioner was held to be a manufacturer and the goods were not exempt from duty under the said notification the demand was defective because (a) the Department was entitled levy the duty at the rate of 29. 3 np. per square meter and not the enhanced rate of Rs. 00-45 np. 3 np. per square meter and not the enhanced rate of Rs. 00-45 np. per square meter which became operative from April 22 1962 while the goods were admittedly removed without payment of duty from June 1 1959 to January 1961 and (b) that even on the footing that the petitioner war manufacturer the society having been allowed to work on only fore power-looms during the period from June 1 1959 to September 30 1959 the petitioner would be entitled to exemption from the entire duty on goods produced on looms during that period by virtue the notification dated January 5 1957. ( 24 ) THE stand adopted by Mr. Sorabji was that under the agreement the petitioner was no doubt to supply yarn to the society that ownership in that yarn remained all throughout in the petitioner and the position of the society was no more than that of a bailee. The society was to be paid at the rate of Rs. 00-19 np. per yard for weaving cloth from out of this yarn and after the goods were ready it was the obligation of the society to deliver the goods to the petitioner at Bombay and bear the transport charges therefor. Consequently the position was that the society was in the position of an independent contractor having no relationship with the petitioner as between an employer and an employee. The act of manufacturing the goods was thus the act of the society and therefore it was the society which was the manufacturer. While considering the definition of manufacturer in Special Civil Application No. 751 of 1961 we have already dealt with this aspect of the question and have held that the mere fact that the society was not an employee of the petitioner and the tact that the act of manufacturing was that of the society would not mean that the petitioner was not a manufacturer within the meaning of sec. 2 (f) of the Act. In a case where a master gets the goods manufactured through his servant the actual act of manufacturing would be the act of the servant. Even Mr. Sorabji did not and could not contend that in such a case the servant and not the master would be the manufacturer. 2 (f) of the Act. In a case where a master gets the goods manufactured through his servant the actual act of manufacturing would be the act of the servant. Even Mr. Sorabji did not and could not contend that in such a case the servant and not the master would be the manufacturer. Therefore the mere fact that the physical act of weaving the cloth was done by the society makes no difference as it was the petitioner who from yarn supplied by him got the cotton fabrics manufactured through the society. The real manufacturer therefore was the petitioner the raw materials belonged to him and remained throughout his the goods when produced belonged to him his liability under the agreement being only to pay to the society the agreed charges for weaving. It is true that under the agreement the society was to bear the transport charges in respect of yarn brought from Bombay to the societys factory at Gandevi and in respect of cotton fabrics despatched to Bombay to the petitioner. But the agreement shows that when the rate of Rs. 00-19 np. was agreed between the parties that rate included transport charges and it was therefore that the society had to bear transport expenses both for the yarn sent to it from Bombay and when the goods were despatched by it to Bombay to the petitioner. 4g appears that that was the strategy employed by the parties to conceal the fact that the petitioner was the real manufacturer and to show that the goods were manufactured by the society and it was the society which removed the goods from its factory and delivered them at Bombay so that the petitioner may not be charged with the act of removing goods without payment of duty The reasons given by us in Special Civil Application No. 751 of 1961 apply more forcefully to the facts of this case and on the basis of those reasons we negative the contentions (1) to (3) urged on behalf of the petitioner. As regards contention No. (4) also as held by us in Special Civil Application No. 751 of 1961 there is no question of the authority having found the petitioner a manufacturer on one set of facts and the Court holding him to be a manufacturer on another set of facts to which the authority had not applied its mind. As regards contention No. (4) also as held by us in Special Civil Application No. 751 of 1961 there is no question of the authority having found the petitioner a manufacturer on one set of facts and the Court holding him to be a manufacturer on another set of facts to which the authority had not applied its mind. The facts on which the petitioner was held to be a manufacturer in that petition were similar to the facts in this petition and on which there is hardly any controversy between the parties. The only mistake that the authority may be said to have made is that it used a wrong description namely of the petitioner having employed hired labour instead of describing the society as an independent contractor. Whatever the legal relationship between the parties was and howsoever it was described by the Authority the petitioner cannot cease to be a manufacturer within the meaning of section 2 (f) of the Act. ( 25 ) COMING now to the constitutional question raised by Mr. Sorabji we may at once make it clear that though the petition has raised a number of questions Mr. Sorabji confined his challenge only to sec. 3 of the Act and rules 7 and 9. H was also frank enough to state that his contention was base almost solely on certain observations made by the Supreme Court in K. T. Moopil Nair v. State of Kerala and another A. I. R. 1961 S. C. 552 at page 559. Before we proceed to examine this contention it is necessary to acquaint oneself with the scheme of the Act and the rules. Section 3 of the Act which is the charging section provides for the levy and collection in such manner as may be prescribed of duties of excise on all excisable goods produced or manufactured in India at the rates set forth in the First Schedule of the Act. Section 37 (2) (i) empowers the Central Government to make rules inter alia in connection with assessment and collection the authorities by whom the functions under the Act are to be discharged the issue of notices requiring payments the manner in which duty shall be payable and the recovery of duty not paid. Section 37 (2) (i) empowers the Central Government to make rules inter alia in connection with assessment and collection the authorities by whom the functions under the Act are to be discharged the issue of notices requiring payments the manner in which duty shall be payable and the recovery of duty not paid. Section 38 provides for the publication of rules and notifications and the proviso thereto lays down that every such rule shall be laid as soon as may be after it is made before Parliament while it is in session on for a period of thirty days and if before the expiry of that period Parliament makes any modification in the rule or directs that the rule should not be made the rule shall thereafter have effect only in such modified form or be of no effect as the case may be. Rule 7 which is one of the two rules impugned in this petition provides inter alia that every person who produces or manufactures any excisable goods shall pay duty leviable on such goods at such time and place and to such person as may be designated in or under the authority of these rules whether the payment of such duty or duties is secured by bond or otherwise. Though duty therefore is to be levied on goods this rule lays down the parties from whom it is to be recovered. Therefore the rule is not a charging rule nor does it deal with assessment The only thing that the rule does is to provide that in the case of goods which are excisable goods and duty is payable thereupon under sec. 3 of the Act the persons therein set out are the persons from whom duty is to be recovered. Therefore the rule is not a charging rule nor does it deal with assessment The only thing that the rule does is to provide that in the case of goods which are excisable goods and duty is payable thereupon under sec. 3 of the Act the persons therein set out are the persons from whom duty is to be recovered. Rule 9 deals with the time and the manner of payment of duty and sub-clause (1) thereof provides that no excisable goods shall be removed from any place where they are produced cured or manufactured or any premises appurtenant thereto which may be specifield by the Collector in this behalf whether for consumption export or manufacture of any other commodity in or outside such place until the excise duty leviable thereon has been paid in such place and in such manner as is prescribed by these rules or as the Collector may require and except on presentation of an application in the prescribed form and on obtaining permission of the proper officer on the form. There are two provisos to this rule but we do not propose to detain ourselves on them as they are not relevant for the purposes of this petition. Subclause (2) of rule 9 provides that if any excisable goods are in contravention of sub-rule (1) deposited in or removed from any place specified therein the producer or manufacturer thereof shall pay the duty leviable on such goods upon written demand made by the proper officer whether such demand is delivered personally to him or is left at his dwelling house and shall also be liable to a penalty which may extend to two thousand rupees and such goods shall be liable to confiscation. Rule 49 makes it clear that duty is payable only at the stage of removal of excisable goods and not at the stage of manufacture or production. In order that the goods may not escape payment of duty various checks are provided for in the rules. It is not necessary to go into all the rules but it would be sufficient if we indicate a few rules showing these checks. In order that the goods may not escape payment of duty various checks are provided for in the rules. It is not necessary to go into all the rules but it would be sufficient if we indicate a few rules showing these checks. Rule 174 requires inter alia every manufacturer of excisable goods except salt to take out a licence and not to conduct his business in regard to such goods otherwise than by authority and subject to the terms and conditions of the licence granted by a duly authorised officer in the proper form. Rule 43 provides that every manufacturer who intends to manufacture excisable goods for the first time shall give notice in writing to the Collector at least fifteen days before commencing operations and shall specify therein the nature of the raw materials which he intends to use. It also provides that every manufacturer of excisable goods shall give notice in writing to the Collector of his intention to stop or resume the production of such goods at least fifteen days before stopping or resuming such production as the case may be and it further provides that whenever there is any change in the nature of any raw material used the manufacturer shall give notice in writing to the Collector specifying the new material to be used at least fifteen days making the change. Rule 44 requires such manufacturer to make a proper declaration of factory premises and equipment to the Collector. Rule 50 provides that even non-excisable goods are not to be removed without the permission from the Collector. Rule 53 requires every manufacturer to maintain a stock account in the proper form or in such other form as the Collector may in a particular case prescribe and requires the manufacturer to enter in such account daily the weights description and rating of all excisable goods which are manufactured or deposited in the store room or other place of storage approved by the Collector or removed after payment of excise duty from such store room or other place of storage or from the place or the premises specified in rule 9 and all goods delivered from the factory for export without payment of duty and requires such a manufacturer to preserve such accounts and keep them available for inspection by any officer for a period of at least twelve months. Similarly rule 54 requires every manufacturer to submit monthly returns to the proper officer in proper form showing the quantity of excisable goods manufactured in the month the quantity removed on payment of duty from the place or premises specified in rule 9 or from the store room or other place of storage approved by the Collector under rule 47 the quantity removed for export without payment of duty and such other particulars as may be elsewhere prescribed or as the Central Board of Revenue or the Collector may require. Rule 55 requires that at the end of every manufacturing period or if manufacture is continuous at the end of every quarter the manufacturer shall sign and deliver to the proper officer a return in the proper form truly stating with respect to the period in question the weight of each description of materials used in the manufacture the weight of each description of finished goods produced and such other materials as the Central Board of Revenue or the Collector may by general or special order require. ( 26 ) IT is thus clear that from the time that the process of manufacture is set in motion until it is finished these rules see to it that a detailed check by the excise authorities is maintained the officers on the basis of these statements and returns maintained by the manufacturer knowing what goods are manufactured and of what quality and description or value they are. When all these stages are passed and the goods are to be removed a person removing the goods has to make an application under rule 52 for the clearance thereof. Rule 52 provides that when a manufacturer desires to remove goods on payment of duty either from the place or premises specified under rule 9 or from a store-room or other place of storage approved by the Collector under rule 47 he shall make an application in triplicate to the proper officer in the proper form and shall deliver it to the officer at least twelve hours before it is intended to remove the goods. The officer shall thereupon assess the amount of duty due on the goods and on production of evidence that this sum has been paid into the Treasury or paid to the account of the Collector in the Reserve Bank of India or the State Bank of India or has been despatched to the Treasury by money order shall allow the goods to be cleared. The application for removal of excisable goods on payment of duty has to be in Form A. R. 1 and which requires the person who desires to remove the goods to give detailed particulars as regards the description of packages the gross weight of the packages the marks and numbers of the packages the description of the goods with tariff classification the weight or the quantity of the goods the value thereof the rate at which duty is payable and the total amount of duty payable thereupon. It then becomes the duty of the relevant officer to assess the rate as also the total amount of duty payable and to enter them in the assessment memorandum provided in the form setting out therein the total number of packages the quantity of the goods on which duty is assessed the rate of duty and the total duty payable on those goods. If he accepts the particulars set out by the applicant particularly as regards the description and the rate of duty payable on the goods in question there would be no difficulty and the officer would have to assess the total duty payable on the rate of duty set out by the applicant and obviously therefore there would be no dispute between the Department and the applicant as regards the assessment or the duty payable by such an applicant. The difficulty would only arise if there is a dispute and the officer were to assess in the assessment memorandum on a scale different from the one set out by the applicant in his application. In such a case the rules provide two remedies to the applicant. He may resort to an appeal from such assessment and then a revision as provided by rules 213 and 214 or apply for a provisional assessment under rule 9b. In such a case the rules provide two remedies to the applicant. He may resort to an appeal from such assessment and then a revision as provided by rules 213 and 214 or apply for a provisional assessment under rule 9b. That rule provides that a manufacturer curer or owner of goods warehoused may in cases where assessment of goods involves two or more alternative basis request the proper officer to assess the goods provisionally at lower or the lowest of the rates of duty applicable (a) pending furnishing by such manufacturer curer or owner of complete information as regards the value description or quality of the goods or if such information has already been furnished pending supply of proof therefor or (b) pending completion of any chemical or other test to which the goods may be subjected by such officer and such officer may at his discretion direct that duty on such goods may be provisionally assessed and prescribe the time limit within which the complete information or proof of the information already furnished shall be supplied by such manufacturer curer or owner in respect of the goods so assessed. Such a manufacturer curer or owner in that event has to execute a bond in the proper form with such surety or sufficient security in such amount or under such conditions as the Collector approves binding himself for payment of the difference between the amount of duty as provisionally assessed and that as finally assessed on receipt of complete information or proof therefor or of the results of chemical or other tests made in respect thereof. The rule further provides that when the duty leviable on the goods is assessed finally the duty provisionally assessed shall be adjusted against the duty finally assessed and if the duty provisionally assessed falls short of or is in excess of the duty finally assessed the manufacturer curer or the owner of the goods shall pay the deficiency or be entitled to a refund as the case may be. No doubt the rule gives power to the officer to make provisional assessment at his discretion but if the officer were to refuse to allow such provisional assesment the applicant has a right of appeal and a vision against such refusal. No doubt the rule gives power to the officer to make provisional assessment at his discretion but if the officer were to refuse to allow such provisional assesment the applicant has a right of appeal and a vision against such refusal. If the applicant does not wish to apply for such provisional assessment for some reason or the other he can go in appeal against the assessment made by the officer under rule 52 and then in revision if necessary. It is true that by reason of certain provisions of the Sea Customs Act having been made applicable to this Act an appellant has to deposit the duty amount before his appeal is entertained. But the rigour of this rule is now lessened by the enactment of section 129 in the new Sea Customs Act 1962 Section 129 of that Act provides that where the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of customs authorities or any penalty levied under this Act any person desirous of appealing against such decision or order shall pending the appeal deposit with the proper officer the duty demanded or the penalty levied. The proviso to sub-section (1) of that section however provides that where in any particular case the appellate authority is of opinion that the deposit of duty demanded or penalty levied will cause undue hardship to the appellant it may in its discretion dispense with such deposit either unconditionally or subject to such conditions as it may deem fit. This section differs from sec. 189 of the old Act inasmuch as the deposit is to be made only where the goods in question at the date of the appeal are not under the control of the authorities and furthermore even in such a case the proviso gives discretion to the appellate authority if insistence on deposit would cause hardship not to insist upon such deposit. It is therefore clear that so long as the goods are in a warehouse and are not removed therefrom and are therefore under the control of the authorities the deposit of the duty amount has not to be made and an appeal has to be entertained without such deposit. It is therefore clear that so long as the goods are in a warehouse and are not removed therefrom and are therefore under the control of the authorities the deposit of the duty amount has not to be made and an appeal has to be entertained without such deposit. ( 27 ) THE new Act came into force as from February 1 1963 The memo of appeal in the instant case was sent to the appellate authority on February 2 1963 and therefore must have been received by that authority not earlier than February 2 1963 i. e. after the Act came into force and therefore sec. 129 would apply. In the present case the goods in question were not under the control of the Department but inspite of that fact and though the goods were removed without payment of duty there was still a right in the petitioner to apply for dispensing with the deposit amount under the proviso to section 129 (1 ). An application was in fact made for dispensing with the deposit but it is clear from the record that the application was not based on the footing of any hardship but on the ground that the appellate authority was not entitled to insist upon such deposit before he entertained the appeal. The record shows that the appeal was rejected on the ground that the petitioner had failed to deposit the amount but he had failed to produce any data to show that payment of the deposit would cause undue hardship to him. Had the petitioner established that he was not in a position to deposit or that the deposit would paralyse his trading activities and thus cause hardship there is no reason to presume that the appellate authority would have acted harshly or unreasonably and rejected his application. Not having even attempted to prove such hardship it would not lie in the mouth of the petitioner to complain against the rejection on of his appeal on failure by him to deposit the duty. ( 28 ) NOW the contention urged by Mr. Sorabji was that sec. 3 of the Act and rules 7 and 9 are unconstitutional because they impose an unreasonable and excessive restriction upon the petitioners right to trade and to hold property and thus violate the provisions of Article 19 (1) (f) and (g ). ( 28 ) NOW the contention urged by Mr. Sorabji was that sec. 3 of the Act and rules 7 and 9 are unconstitutional because they impose an unreasonable and excessive restriction upon the petitioners right to trade and to hold property and thus violate the provisions of Article 19 (1) (f) and (g ). The way this contention was formulated before us was (1) that the Act provides no machinery for assessment of duty (2) that it also does not lay down any procedure as to a notice to the person made liable before his assessment is made (3) that the Act and the rules do not make any provision for hearing the objections if any of the person as to his liability for payment or the extent of payment i. e. the rate of duty (4) that there is no provision in the Act or the rules for having recourse to a higher civil Court such as a reference as provided under other fiscal statutes or a right of appeal to such civil Court and lastly (5) that though a right of appeal is provided for as a result of an appellant having to deposit the duty amount an onerous condition is imposed which renders that right illusory. Mr. Sorabji argued that the combined effect of all these factors was that the impugned sec. 3 and rules 7 and 9 imposed an unreasonable and excessive restriction upon the petitioners right to trade and to hold property and therefore these impugned provisions suffered from unconstitutionality. The five indicia upon which section 3 and rules 7 and 9 are assailed as being unreasonable and excessive restrictions are bodily taken as already pointed out from the decision in Moopil Nairs case where Sinha C. J. speaking for the Court held with reference to sec. 5a of the Travancore-Cochin Land Tax Act 1955 as amended by Act X of 1957 that the provisions of sec. 5a in that Act were bad as being violative of Article 19 (1) (f) and as constituting unreasonable restriction on the right to hold property. 5a of the Travancore-Cochin Land Tax Act 1955 as amended by Act X of 1957 that the provisions of sec. 5a in that Act were bad as being violative of Article 19 (1) (f) and as constituting unreasonable restriction on the right to hold property. Section 5a which was inserted in the Act by the amending Act X of 1957 gave power to the Government to make a provisional assessment of basic tax payable by a person in respect of land held by him and which was still unserveyed land and upon such assessment such person became liable to pay the amount covered in the provisional assessment. The Act was challenged on other grounds also and in particular on the ground of inequality and being discriminatory thus offending Article 14. But for our present enquiry we are not so much concerned with the decision qua Article 14 as with the observations made with reference to the challenge under Article 19. After setting out sec. 5a the learned Chief Justice observed that that section was also equally objectionable because it imposed an unreasonable restriction on the right to hold property safeguarded by Article 19 (1) (f ). Section 5a declared that the Government was competent to make a provisional assessment of the basic tax payable by a holder of unsurveyed land. With respect to that section the learned Chief Justice observed-"ordinarily, a taxing statute lays down a regular machinery for making assessment of the tax proposed to be imposed by the statute. It lays down detailed procedure as to notice to the proposed assessee to make a return in respect of property proposed to be taxed prescribes the authority and the procedure for hearing any objections to the liability for taxation or as to the extent of the tax proposed to be levied and finally as to the right to challenge the regularity of assessment made by recourse to proceedings ia a higher Civil Court. The Act merely declares the competence of the Government to make a provisional assessment and by sec. 3 of the Madras Revenue Recovery Act 1864 the land-holders may be liable to pay the tax. The Act being silent as the machinery and procedure to be followed in making the assessment leaves it to the Executive to evolve the requisite machinery and procedure. The whole thing from beginning to end. 3 of the Madras Revenue Recovery Act 1864 the land-holders may be liable to pay the tax. The Act being silent as the machinery and procedure to be followed in making the assessment leaves it to the Executive to evolve the requisite machinery and procedure. The whole thing from beginning to end. is treated as of a purely administrative character completely ignoring the legal position that the assessment of a tax on person or property is at least of a quasi-judicial character. Again the Act does not impose an obligation on the Government to undertake survey proceedings within any prescribed or ascertainable period with the result that a land-holder may be subjected to repeated annual provisional assessments on more or less contractual basis and liable to pay the tax thus assessed. . . . . . . The Act thus proposes to impose a liability on land-holders to pay a tax which is not to be levied on a judicial basis because the procedure to be adopted does not require a notice to be given to the proposed assessee; (2) there is no procedure for rectification of mistakes committed by the Assessing Authority; (3) there is no procedure for obtaining the opinion of a superior Civil Court on questions of law as is generally found in all taxing statutes and (4) no duty is cast upon the Assessing Authority to act judicially in the matter of assessment proceedings. Nor is there any right of appeal provided to such assesses as may feel aggrieved by the order of assessment. " ( 29 ) IT will be observed that there is a sharp difference between the Travancore-Cochin Act and the present Act. The former provided a tax at a flat rate without any regard to the nature or the quality of the land and also irrespective of whether the land was productive or not. It contained no procedure whatsoever and left the executive to evolve such procedure as it thought best leaving no room for the subject to take objection to the assessment and having also no provision for a right of appeal. It contained no procedure whatsoever and left the executive to evolve such procedure as it thought best leaving no room for the subject to take objection to the assessment and having also no provision for a right of appeal. The Central Excise and Salt Act cannot be compared or placed on an analogy with the Travancore-Cochin Act for as already pointed out the rules made under the Act have provided for (1) a detailed procedure of assessment (2) the right of the assessee to raise objection and (3) for a right of appeal in the first instance and thereafter a revision. It is true that unlike other fiscal statutes such as the Income Tax and the Sales Tax Acts there is no provision for filing returns but that is because the tax is of a totally different character namely on goods and leviable only at the stage of removal. As already stated the rules provide a detailed machinery for checks right from the stage when manufacture commences until the goods are ready for removal in the course of which the manufacturer has to file statements of raw materials used in the manufacture of goods manufactured their value description etc. When the goods are to be removed he is required to file an application under rule 52 in which he has to set out various particulars on the basis of which the officer ordinarily would make his assessment memorandum. Just as the returns filed by an assessee under other fiscal statutes form the basis of an assessment similarly the particulars furnished by the manufacturer in his application under rule 52 would form the basis of assessment with this difference however that whereas the returns under the Income Tax and the Sales Tax Acts are not checked previously and the data previously ascertained by the authorities in the case of an application under rule 52 the details furnished therein have already been the subject matter of periodical checks by the Department. Even if there is a dispute between the manufacturer and the Department the former as already shown has two remedies namely to ask for a provisional assessment or to resort to an appeal and a revision. Even if there is a dispute between the manufacturer and the Department the former as already shown has two remedies namely to ask for a provisional assessment or to resort to an appeal and a revision. Under sections 35 and 36 of the Act a manufacturer has been given the right of appeal and revision against any decision or order passed by an officer either under the Act or the rules and therefore such a person can go in appeal if the officer were to decline to exercise his discretion and refuse to make a provisional assessment. Under rule 9b if the officer agrees to make a provisional assessment a manufacturer has a right to furnish further information if he thinks necessary or if all information has been furnished by him to adduce proof in support of such information already supplied which gives him the opportunity to lead evidence. The right to take objection against the assessment is therefore provided for both at the stage of assessment and thereafter by way of an appeal and a revision under sections 35 and 36 of the Act. Thus the provisions impugned before us are of a different nature and not comparable with those which were before the Supreme Court in Moopil Nairs case. ( 30 ) BUT Mr. Sorabji urged that the Supreme Court in Moopil Nairs case has laid down once and for all that the true legal position is that an assessment of tax on person or property is of at least a quasi-judicial character. The learned Advocate General on the other hand contended that the observations made by the Supreme Court in that case were with reference to the nature of the tax and the particular provisions of that Act and in particular those of section 5a of that Act. He relied upon Glaxo Laboratories (India) private Ltd. v. A. V. Venkateswaran (1959) 61 B. L. R. 1 where on the provisions of the Sea Customs Act 1878 which are somewhat similar to those in the Act before us the High Court of Bombay drew a distinction between the provisions which provided for assessment and those which provided for confiscation payment of duty in lieu of confiscation and penalty and held after examining both the English and the Indian decisions that the assessment order under sec. 87 of the Sea Customs Act was an administrative order whereas the order regarding confiscation and penalty was a quasi-judicial order. Mr. Sorabji however disputed the correctness of the Bombay view in view of the observations of the Supreme Court in Moopil Nairs case. But there is a clear distinction between an assessment under rule 52 and a demand under rule 9 (2 ). The impugned order is obviously not an order under rule 52 but an order under rule 9 (2) which is a provision contemplating a situation different from the one under rule 52 and the order made under rule 9 (2) would be a composite order of demand for duty and penalty for removal of the goods. In the case of an assessment under rule 52 the order is made before the goods are removed and though assessment may be made the person liable to pay duty does not become liable merely because an assessment is made but only when the goods are removed and then at that stage a demand is made for payment. In the case of an order under rule 9 there is no assessment as under rule 52 for rule 9 (2) is on the footing that the goods in question are already removed without payment of duty and in contravention of rule 9 (1 ). Since the goods are removed without an application under rule 52 having been made there can obviously be no assessment in the sense of an assessment under that rule. What the officer therefore does is that when he finds that goods are removed without payment of duty he makes a demand for the duty leviable on such goods on such information he may have. He has the power to levy penalty and order confiscation of goods. The proceedings thus under rule 52 and rule 9 (2) are of a totally different nature. ( 31 ) THAT being so and the impugned order in this petition being under rule 9 (2) Mr. Sorabji has to assail rule 9 (2) on the ground that its provisions violate Article 19 (1) (f) or (g) and not the provisions as to assessment under rule 52. ( 31 ) THAT being so and the impugned order in this petition being under rule 9 (2) Mr. Sorabji has to assail rule 9 (2) on the ground that its provisions violate Article 19 (1) (f) or (g) and not the provisions as to assessment under rule 52. A petitioner prejudicially affected by an order which is not an order under rule 52 cannot in the abstract approach the Court and challenge its validity on the mere ground that though the order affecting his right of property is passed under another provision the Act contains some other provisions which suffer from constitutional infirmity. ( 32 ) LOOKED at from this point of view much of the force of Mr. Sorabjis argument would be lost and the five indicia pointed out in Moopil Nairs case would not apply. Section 3 which is challenged is a charging section and merely lays down that excise duty will be chargeable on excisable goods as specified in the First Schedule. Rule 7 merely provides that the persons specified therein are the persons from whom duty has to be recovered. Neither section 3 nor rule 7 thus has anything to do with assessment or collection of duty. The only ground of challenge being that neither the Act nor the rules lay down any machinery for assessment notice objection to such assessment right of appeal untramelled by any onerous conditions it is difficult to appreciate how the provisions of section 3 or rule 7 can be assailed on these grounds when they do not deal with assessment or collection. ( 33 ) THEN remains rule 9 for consideration. The first clause of rule 9 provides that no excisable goods shall be removed from any place where they are produced cured or manufactured etc. whether for consumption export or manufacture of any other commodity in or outside such place unless excise duty leviable thereon has been paid at such place or in such manner as is prescribed by the rules or as the Collector may require and except on presentation of an application in the proper form and on obtaining permission of the proper officer on the form. This clause only means that no person shall remove the goods from any of the places mentioned in this part of the rule unless an application under rule 52 is made in the form prescribed thereunder and an assessment under that rule is made and duty so assessed is paid and permission to remove them is granted. The first clause of the rule therefore lays down prohibition against removal without payment of duty and has nothing to do with assessment which as we have more than once said is made under rule 52. There are provisos to the first part of the rule providing for cases where goods can be removed without payment of duty but they have nothing to do with assessment or the question raised by Mr. Sorabji. Clause (2) of rule 9 is the provision under which the impugned order has been made. Let us therefore examine its provisions to see if they suffer from any unconstitutionality. Clause (2) provides that if any excisable goods in contravention of clause (1) are deposited in or removed from any place specified therein the producer or manufacturer shall pay duty leviable on such goods upon a written demand made by the proper officer and shall be liable to a penalty which may extend to two thousand rupees and such goods shall be liable to confiscation. Clause (2) clearly is a penal provision making a producer or a manufacturer liable to duty and confistation of goods removed in contravention of the ban laid down in the first clause. It will be observed that the liability to pay duty leviable on the goods under this clause arises from two factors (1) an illegal removal thereof and (2) consequent thereupon the authority making a demand of duty chargeable thereon. There is no assessment on these goods provided in this part of the rule and there can become because the goods are not there to be assessed as they are in fact surreptitiously removed without an application under rule 52 having been made and without any assessment or payment on such assessment and without the permission to remove having been obtained. Therefore the case contemplated under rule 9 (2) is one where there can be no assessment. Therefore the case contemplated under rule 9 (2) is one where there can be no assessment. It is a case on the other hand where the authority discovering that the goods have been removed without payment of duty makes a demand of duty leviable thereon from such information as he might have collected and which empowers him to impose penalty and to order confiscation of the goods. ( 34 ) IT is true that neither rule 9 nor any other rule provides for any machinery for notice assessment of duty or procedure under which the producer or the manufacturer can raise objection and therefore it would at first sight appear to contain arbitrary powers conferred on the authority. But section 33 of the Act in express terms provides that where by rules made under the Act anything is liable to confiscation or any person is liable to a penalty such confiscation or penalty may be adjudged by the officers specified therein. Section 33 occurs in Chapter VI which is headed as Adjudication of confiscations and Penalties. There is thus in clear terms a duty to adjudge cases of confiscations and penalties by a judicial process and the function is clearly judicial or at least a quasi-judicial function and therefore subject to the principles of natural justice even though the rules may not provide a procedure and a machinery for the determination of such questions. But there is no challenge to the orders in question in this petition and in the petitions following this petition on the ground that the principles of natural justice were violated. The petitioner was served with a notice to show cause. He filed his written statement and was given a personal hearing when he was represented by counsel and it was then that the respondent passed the impugned order. It is therefore clear that after the authority makes a demand under rule 9 (2) the producer or the manufacturer who has removed the goods in contravention of clause (1) of the rule has the opportunity to raise an objection either on the ground that he is not liable or on the quantum of duty and that objection has to be heard consistently with the principles of natural justice. It is equally clear that it is only when a demand is made under this part of the rule that the liability to pay arises and not other wise. Therefore the right to hold property as safeguarded under Article 19 and (g) is affected as from the time the demand is made. But since the statute gives a right to object to such a demand and in express terms provides that the function under rule 9 (2) is a judicial or a quasi judicial function it would not be possible to urge that such a restriction is either arbitrary or unreasonable or excessive. In any event the provision cannot be assailed on the ground that it is unreasonable on the ground that there is no machinery or procedure provided for in the rule because section 33 of the Act provides in so many terms that though no such procedure or machinery is provided for the function is subject to a judicial process and the principles of natural justice. ( 35 ) AS we have seen sections 35 and 36 provide for a right of appeal in the first instance and then a revision. It is true that the appellant is required to deposit the duty amount before his appeal can be entertained. But after section 129 of the new Sea Customs Act 1962 came into force it would no longer be possible to contend that the right of appeal is illusory as an onerous obligation has been imposed upon an appellant causing him hardship and making the right impossible to exercise. As alrerdy observed under section 129 9f the goods are under the control of the customs no duty amount has to be deposited and even in cases where they are not the proviso to the section empowers the appellate authority to dispense with the deposit. If the appellate authority declines to exercise this power the party concerned has a right to go in revision under section 36. The petitioner filed an appeal but declined to deposit the duty amount. The correspondence between the petitioner and the appellate authority shows that the petitioner merely expressed his incapacity to deposit the duty amount without attempting the establish at any stage such incapacity or the hardship it would cause to him by paralysing his business. No materials at any time were placed before the appellate authority to show such undue hardship. The correspondence between the petitioner and the appellate authority shows that the petitioner merely expressed his incapacity to deposit the duty amount without attempting the establish at any stage such incapacity or the hardship it would cause to him by paralysing his business. No materials at any time were placed before the appellate authority to show such undue hardship. Even in the memo of appeal no attempt was made to furnish any data from which his alleged incapacity to deposit could be deduced. Even when the appeal was dismissed on the ground of failure to deposit the petitioner did not go in revision challenging the order. In chaturbhai M. Patel v. Union of India and others A. I. R. 1950 S. C. 424 though the challenge was to sections 6 and 8 of this Act and the rule made thereunder and the goods in question were tobacco the situation was somewhat analogous to the one before us. The petitioner there was a dealer in tobacco and owned a private bonded warehouse and held licence for the same. The petitioners warehouse was checked by the excise officer who on finding some irregularity sealed the warehouse and subsequently took possession of the registers and other documents. Thereafter the officer removed certain bags of stems of tobacco from the warehouse and stored them in some other place. The petitioner made a representation against these orders to the Collector of Central Excises and some correspondence ensued between them thereafter. A notice was served upon the petitioner thereafter to show cause why penalty should not be imposed upon him for contravention of certain Central Excise rules and why the aforesaid bags should not be confiscated. Finding the charges against the petitioner proved the Collector ordered confiscation of the bags imposed a fine of Rs. 150/and the duty leviable thereon in lieu of confiscation. The appeal taken to the Central Board of Revenue was dismissed as the petitioner refused to deposit the penalty of Rs. 2000/and a revision to the Central Board of Revenue was also dismissed for the same reason. 150/and the duty leviable thereon in lieu of confiscation. The appeal taken to the Central Board of Revenue was dismissed as the petitioner refused to deposit the penalty of Rs. 2000/and a revision to the Central Board of Revenue was also dismissed for the same reason. The petitioner raised three contentions namely that sections 6 and 8 were beyond the legislative competence of the Central Legislature under the Constitution Act of 1935 that even if they were within the legislative competence they imposed an unreasonable restraint on the petitioners right to trade in tobacco and that the orders passed by the Collector were ultra vires the Act and the rules made there under. An argument similar to the one advanced before us was also raised there. Dealing with the argument that the restriction imposed under the impugned sections of the Act and the rules were unreasonable and not saved by Article 19 (6) as the rules did not lay down any machinery for notice or taking evidence before an order for penalty or confiscation was made the Supreme Court stated that the power to order confiscation and impose penalty being judicial functions the Tribunal had to act judicially and though no procedure may be provided for for notice or for objection by the aggrieved party such a Tribunal must conform to the principles of natural justice. The Supreme Court added that there is no dispute that in the instant case there was no breach of this rule. Not only this there is a right of appeal and a revision is also provided and both these remedies the petitioner availed himself of. The argument of unreasonable restriction because of this ground must also fail. ( 36 ) TO sum up there is a clear difference between proceedings for assessment under rule 52 and the proceedings by way of penalty under rule 9 (2 ). The former proceedings arise when an application is made in the prescribed form for the removal of excisable goods. The prescribed form for such an application requires details of various kinds to be filled in by the producer or the manufacturer and the officer then makes the assessment. The very nature of the tax is such that no elaborate procedure would be possible. The prescribed form for such an application requires details of various kinds to be filled in by the producer or the manufacturer and the officer then makes the assessment. The very nature of the tax is such that no elaborate procedure would be possible. Since duty is payable only at the stage of removal the question of its payment does not arise till an application is made for the removal of the goods. Therefore instead of a notice to file the returns as in other fiscal statutes the party who applies for removal is called upon to furnish details in his application on which the authority is enabled to make assessment. On such assessment as already stated the applicant has two remedies if he is aggrieved either under rule 9b demanding provisional assessment in which case he has a right to give further information or to adduce proof of the information already furnished by him or to go in appeal. As held by this Court in Chandulal Jethalal v. The State of Gujarat I. L. R. 1964 Guj. 96 at pages 135 to 139 [ (1963) IV G. L. R. 1033 at page 1057 to 1059 ] the right of appeal provided it is not hollow or farcical saves the administrative power or the function from being an unreasonable restriction. The fact that there is a provision for filing such an application with the details filled in by the producer or the manufacturer coupled with the fact that there are provisions in the Act and the rules enabling such a party to demand provisional assessment entailing a right to adduce evidence and the right of appeal and revision clearly shows that the ratio laid down in Moopil Nairs case cannot apply to the Act and the rules before us. The proceedings under rule 9 (2) on the other hand are clearly judicial or at least quasi-judicial proceedings and though the rules do not provide for an elaborate procedure still they have to be in conformity with the principles of natural justice. That being so it is impossible to challenge section 3 or rules 7 and 9 on the ground of their being unreasonable restriction to the right to hold property or to carry on trade or business. The challenge to the constitutionality of these provisions must therefore fail. ( 37 ) ). That being so it is impossible to challenge section 3 or rules 7 and 9 on the ground of their being unreasonable restriction to the right to hold property or to carry on trade or business. The challenge to the constitutionality of these provisions must therefore fail. ( 37 ) ). Sorabji then argued that assuming that these provisions are valid and assuming also that the petitioner is the manufacturer and the goods in question are excisable goods on which duty is leviable the demand for duty under rule 9 (2) having been made three months after the goods were removed and they became liable to duty the demand was time-barred under rule 10 and therefore it was beyond the jurisdiction of the respondent to make such a demand and pass the impugned order. In our view rule 10 does not apply for it applies only to cases set our therein. The rule postulates that there has been an assessment which has resulted in short levy through inadvertence error collusion or mis-construction on the part of an officer or through mis-statement by the owner as to the quantity description or the value of such goods on the part of the owner or after such duty or charges are levied they have been wrongly refunded. In such cases the person who is liable to pay such duty or charges which are so short-levied or wrongly refunded has to pay the deficit or the amount so refunded on a demand made therefor within three months from the date on which the duty or the charge was paid or adjusted in the owners account-current if any or from the date of the refund. The demand made in the instant case was not on the ground of short-levy or refund as envisaged by this rule on an assessment having already been made. The demand in the present case was made under rule 9 (2) on the contravention of clause (1) of that rule i. e. on the goods having been removed clandestinely without there having been an assessment and without the duty chargeable on them having been paid. No question of the demand being time-barred can therefore arise and rule 10 clearly has no application. ( 38 ) [ The rest of the judgment is not material for the reports. ] Petitions dismissed. .