2003 (11) TMI 583 - SC - Central Excise

Whether licensees are required to carry on the business in liquor would mean the liquor free from all types of adulteration? Held that - No citizen has got any fundamental right for the trade in liquor and it is for the Government to evolve the excise policy and implement the same in the interest of the public and safeguard the public may not have much relevance in the fact situation obtaining herein and more so when the said question is pending consideration before the Constitution Bench.

Issues:
1. Interpretation of Section 72 of the Andhra Pradesh Excise Act, 1968 regarding retrospective effect of rules.
2. Requirement of laying down rules before both Houses of the State Legislature.
3. Difference between sub-sections (3) and (4) of Section 72.
4. Comparison with a different rule-making provision in the Water (Prevention and Control of Pollution) Cess Act, 1977.
5. Nature of civil liability in the absence of strict compliance with rules.
6. Directory nature of Rule 24 of the A.P. Excise (Arrack and Toddy Licenses General Conditions) Rules, 1969.
7. Availability of testing facilities in State laboratories for drug testing.
8. Fundamental right of citizens in liquor trade and government's role in excise policy.

Analysis:

1. The judgment addresses the interpretation of Section 72 of the Andhra Pradesh Excise Act, 1968, specifically focusing on the power to give retrospective effect to rules. It clarifies that the provision does not mandate obtaining permission or prior approval from the State Legislature for retrospective rules, emphasizing that laying down rules with reasons before both houses is sufficient.

2. The requirement of laying down rules before both Houses of the State Legislature is discussed, highlighting that this act is directory in nature. The judgment cites previous cases to establish that the purpose of laying rules is to enable legislative scrutiny and discussion, even if not for modification or annulment.

3. A distinction between sub-sections (3) and (4) of Section 72 is drawn, emphasizing that sub-section (3) deals with retrospective rules and the provision of reasons, while sub-section (4) is general in nature. It is noted that a negative resolution by the Legislature can render rules ineffective.

4. A comparison is made with a different rule-making provision in the Water (Prevention and Control of Pollution) Cess Act, 1977, where laying down rules before both Houses was held to be subject to affirmative resolution, requiring a positive act of approval by Parliament for amendments.

5. The judgment discusses civil liability in the absence of strict compliance with rules, stating that the respondents faced civil liability rather than criminal proceedings. It asserts that non-compliance with certain rules does not vitiate proceedings if the respondents have the opportunity to present defenses.

6. The directory nature of Rule 24 of the A.P. Excise (Arrack and Toddy Licenses General Conditions) Rules, 1969 is emphasized, indicating that non-compliance does not invalidate proceedings. The rule is considered as providing guidelines rather than creating substantive rights for licensees.

7. The availability of testing facilities in State laboratories for drug testing is addressed, highlighting that the absence of such facilities does not absolve licensees from their responsibilities regarding public health. The judgment deems Rule 24 as directory in nature considering the public health implications.

8. The judgment briefly touches upon the fundamental right of citizens in the liquor trade and the government's role in formulating excise policies. It suggests that the government has the authority to evolve excise policies in the public interest, pending further consideration by a Constitution Bench.

In conclusion, the judgment provides a detailed analysis of various legal aspects concerning rule-making powers, legislative scrutiny, civil liability, and the directory nature of rules, ensuring clarity on the interpretation of relevant provisions in the Andhra Pradesh Excise Act, 1968.

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