2009 (4) TMI 962 - HC - Central Excise

Issues Involved:
1. Validity of the amendment to Rule 2(n) of the Kerala Abkari Shops Disposal Rules, 2002.
2. Validity of the notification issued by the Government as S.R.O. No.145/2007, fixing the strength of ethyl alcohol in different types of toddy.
3. Whether the excess alcohol content in toddy constitutes a foreign ingredient under Section 57(a) of the Abkari Act.
4. Prosecution under Section 57(a) of the Abkari Act based on alcohol content exceeding prescribed limits.

Issue-wise Detailed Analysis:

1. Validity of the amendment to Rule 2(n) of the Kerala Abkari Shops Disposal Rules, 2002:
The amendment to Rule 2(n) defines toddy as "fermented juice drawn from any coconut, palmyra, or Choondapana palms and conforming to such specifications and restrictions as may be notified by Government based on scientific studies and Indian Standard Specifications." The court found that the definition in the Rules does not conflict with the definition in Section 3(8) of the Act, which defines toddy as "fermented or unfermented juice drawn from a coconut, palmyra, date or any other kind of palm tree." Since there is no conflict, the amendment is valid. The court also found nothing wrong with the amendment to Rule 9, which requires that all toddy sold must be natural and conform to government-notified specifications.

2. Validity of the notification issued by the Government as S.R.O. No.145/2007:
The notification S.R.O. No.145/2007 specifies the permissible alcohol content in different types of toddy: 8.1% for coconut toddy, 5.2% for Palmyra palm toddy, and 5.9% for Sago palm (Choondapana) toddy. The court noted that the prescription for coconut toddy is supported by scientific studies and the Indian Standards Institution, which found that the maximum natural alcohol content in coconut toddy is 8%. Therefore, the prescription of 8.1% is valid. However, for Palmyra palm and Sago palm toddy, the court found no scientific basis for the 5.2% and 5.9% limits and declared these prescriptions ultra vires and unauthorized. The vendors of such toddy cannot be faulted if the alcohol content goes up to 8.1%.

3. Whether the excess alcohol content in toddy constitutes a foreign ingredient under Section 57(a) of the Abkari Act:
Section 57(a) penalizes the mixing of any foreign ingredient likely to add to the intoxicating quality of toddy. The court noted that ethyl alcohol is a natural ingredient of toddy, and if found in excess, it can be presumed to be added from an external source. The court agreed with the learned Single Judge that the excess alcohol should be treated as a foreign ingredient, making the licensee liable under Section 57(a).

4. Prosecution under Section 57(a) of the Abkari Act based on alcohol content exceeding prescribed limits:
The court held that if alcohol is found in excess of the prescribed limit (8.1% for coconut toddy), it can be presumed to be added externally, making the licensee liable under Section 57(a). The court upheld the learned Single Judge's view that the legislative changes and scientific studies now provide a clear basis for this presumption, removing any vagueness in the law. Therefore, the prosecution under Section 57(a) is valid if the alcohol content exceeds the prescribed limits.

Judgment Summary:
The court dismissed the appeal in W.A.No.2867/2007, upholding the validity of the amendment to Rule 2(n) and the notification S.R.O. No.145/2007 concerning coconut toddy. The court declared the prescriptions for Palmyra palm and Sago palm toddy as ultra vires. The court also upheld the prosecution under Section 57(a) for selling toddy with alcohol content exceeding the prescribed limits, treating the excess alcohol as a foreign ingredient. The related writ petitions were disposed of in line with this judgment.

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