Excise exemption for electric batteries turned on counting only workers in the relevant manufacturing process, not unrelated premises activity.

For exemption from central excise duty on electric batteries under the 18 April 1955 notification and 2 May 1958 trade notice, only workers engaged in the manufacturing process connected with the excisable goods were relevant for the five-worker limit. The definition of "worker" in the Factories Act could not be read so broadly as to include employees in unrelated activities carried on in the same premises, such as motor car repairs or recharging customer batteries. As the battery assembling section was separate and employed not more than four workers, the exemption conditions were met and the duty demand was unsustainable.

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Issues: Whether, for the purpose of exemption from central excise duty on electric batteries under the Notification dated April 18, 1955 read with the Trade Notice dated May 2, 1958, workers employed in manufacturing processes unconnected with the manufacture of the excisable goods were to be counted for determining whether the factory employed not more than five workers.

Analysis: The exemption was intended for electric batteries produced in a factory where not more than five workers were working. The Trade Notice adopted the definition of "worker" in the Factories Act, but that expression had to be read in the context of the object of the excise levy and the exemption. The relevant manufacturing process was the one connected with the production of excisable goods, and the words could not be extended to cover unrelated processes such as motor car repairs or recharging of customer batteries carried on in the same premises. Since the battery assembling section was separate and not more than four workers were engaged there, the conditions of the exemption were satisfied.

Conclusion: The workers engaged in unrelated manufacturing processes were not to be counted. The batteries manufactured in the assembling section were exempt from excise duty, and the excise demand was unsustainable.

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