Strict excise exemption interpretation upheld where machines outside the notification were treated as non-qualifying goods.

Exemption under Notification No. 234/82-C.E. was confined to sewing machines and parts thereof, so bag closure machines, overlock machines and embroidery machines did not qualify on a common parlance test. The licensing and declaration requirements under the excise rules were treated as mandatory, and the failure to obtain clarification or file the required declaration could not be justified on the basis of a claimed exemption. The personal penalty was therefore upheld as properly imposed for non-compliance with the licensing and declaration conditions.

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Issues: Whether personal penalty of Rs. 100 was justified for failure to obtain a Central Excise licence and file the required declaration, on the footing that the goods manufactured were exempted sewing machines or parts thereof.

Analysis: The exemption under Notification No. 234/82-C.E. covered only sewing machines and parts thereof, while the goods manufactured were bag closure machines, overlock machines and embroidery machines. On a common parlance understanding, these goods were not shown to be sewing machines. The appellants did not obtain clarification, did not file the declaration called for, and had taken the stand that no declaration was required. The licensing and declaration requirements were treated as mandatory, and exemption claims were required to fall strictly within the notification and the governing excise rules.

Conclusion: The penalty was justified and was confirmed against the appellant.

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