MURTHY MATCH WORKS, ETC. ETC. versus THE ASSTT. COLLECTOR OF CENTRAL EXCISE, ETC.

Citation: [1974] 3 S.C.R. 121 · Decided: 17-01-1974 · Supreme Court of India · Bench: V.R. KRISHNA IYER · Disposal: Dismissed

Cited by 8 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
c 
D 
E 
F 
G 
H 
121 
MURTHY MATCH WORKS, ETC. ETC. 
v. 
THE ASSTT. COLLECTOR OF CENTRAL EXCISE, ETC. 
January 11, 1974 
[V. R. KRISHNA IYER AND R. S. SARKARIA, JJ.] 
Cemral Excise &: Salt Act, 1944-S. 37 and the ,notification issued thereunder-
whether court Cll/I review legislative Judgment-Constitution of India-Reasonable 
classification of principles for determining. 
The match industry in India has grown· over the decides. From the p:>int of 
view of manufacturing techniques the safety match industry comprises of two dis-
tinct categork-:s: the machanised soctor occupied by a few big manufacturen and 
the non-mechanised sector comprising varying sizes of production units. 
The 
Government classified the safety match manufacturers into four categories depending 
on the quantitY turn out and other relevant factors. But the Tariff rommis<;ion 
recommended the abolition of sulrclassification for the purpose of levying eKcise 
duty and s1,1ggested separate scales of excise duty to be levied for four classes· of units, 
namely, A, B, C and D. Based on these recommendations the slab system of excise 
duty was abandoned by the Government and the category wise rate wa'l adopted, 
As a mutt of the adoption of the differential duty scheme the advantages offered 
to the •c• group went to the 'B' group which in turn resulted in fall in production. 
It also generated pscudo-C category producers from out of the erstwJ.ile B category 
which ultimately eliminated C category producers. The Government, therefore, 
withdrew the tax concession to C category and eq:J.1ted it with B category. 
The Government of India had from time .to time issu::d notifications under s. 37 
of the Central Excise and Salt Act, 1944. The notification issued in 1967 levied 
excise duty on the basis of manufacture of matches of which "any process is ordiM 
narily carried on with the aid ·of power". As a result of this notification the B and 
C categories of old were now treated equally. The change in classification of the 
manufacturers was based on the use of power which in turn had a rational relation 
to the techniques and processes of production and their ability to bear the burden 
of the levy, This was done on th~ basis of recom'll'!ndations of the Central Excise 
Re-organisation Committee. 
The High Court refused to strike down the notification. It was contended in 
this Court that this unsocialistic step had left the small producers in the cold and 
virtually compelled them to retire from the industry and is thus discriminatory. 
Dismissing t,he appeals to this Court, 
HELD ; This is a criticism of legislative judgment, not a ground of judicial 
review. The Court is being invited to compel the legislative and executive wings to 
classify but from the judicial insPection -tower the court may only search for arbi-
trary and irrational classification and its obverse, namely, capricious uniformity 
of treatment where a crying dissimilarity exists in reality. Unconstitutionality and 
not unw~dom of a legislation is the narrow area of judicial review. [129 EJ 
The question of classification is primarily for legislative judgment and ordi-
narily does not become a judicial question. The power to classify being extremely 
broad and based on diverse considerations of executive pragmatism the judicature 
cannot rush in where even the legislature warily treads. All these operational 
restraints on judicial power must weigh more emphatica1Iy where the subject 
is taxation. [130 E] 
It is equally well settled that merely because there is room for classifkation it 
does not follow that legislation without classification is always unconstitutional. 
The court cannot strike down a law because it 1i8.s not made the classification which 
commends to the court as proper. Nor can the legislative power be said to have 
been unconstitutionally exercised because within the class a sub-classification was 
reasonable but has not been made. [130 HJ 
122 
SUPREME COURT REPORTS 
l 19741 3 s.c.a. 
ln the ~resent ca"t:, a pertinent prir.ciple of differentiation, which is vi.>ibl;' linked 
to production prowe~s. has been adopted in the broad classification of power-users 
and manual manufacturers. It is irrational to castigate this b:isis a" unre.11. [131 CJ 
K.T. Moopi/ A'air v. Start of Kera/a, [19611 3 S.C.R. 77, State of K·?rala v. Haii 
K. Haji Kuuy }/aha, C. As Nos. 1052 etc. of 1968; iudgment daud August 13, 1968 
and Khandige Shain Bitar v. The Agricultural Income

Excerpt shown. Read the full judgment & AI analysis in Lexace.