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Issues:
Challenge to excise duty notification under constitutional writ jurisdiction; Legislative competence to render ineffective earlier judicial decisions; Validity of amendment Regulation of 1984; Discrimination in refund policy; Unjust enrichment; Refund of excise duty and interest. 1. Challenge to Excise Duty Notification: The Chief Commissioner of the Andaman and Nicobar Islands issued a notification in 1973 re-scheduling excise duty rates on Indian Made Foreign Liquor and Beer. A Single Bench of the High Court at Calcutta held that the Chief Commissioner lacked the power to impose excise duty under the notification. Subsequently, a liquor licensee sought a refund of excise duty paid during the respective period, challenging the authority's power to levy such duty. 2. Legislative Competence to Render Ineffective Earlier Judicial Decisions: The Division Bench of the High Court of Calcutta, in a separate case, held that a legislature can render ineffective earlier judicial decisions by altering the legal basis in the unamended law. However, the power to render judicial decisions invalid cannot be exercised by making a law that declares previous decisions as invalid. Such an act would encroach upon judicial power and be ultra vires to the Constitution. 3. Validity of Amendment Regulation of 1984: The provision of Section 6(1) of the Amendment Regulation of 1984 was deemed to declare earlier judicial decisions as invalid and not binding, encroaching upon judicial power. Therefore, it was held to be invalid and ultra vires to the Constitution. 4. Discrimination in Refund Policy: Section 6(2) of the Amended legislation discriminated between those who had received a refund and those who had not. This discrimination was considered arbitrary and unreasonable, as it created separate classes based on the refund status without logical reasoning. 5. Unjust Enrichment: Refunding excise duty prevents illegal enrichment, especially on the side of the State Administration. Failure to refund amounts collected from dealers who paid under a mistake would result in unjust enrichment for the state, rather than the consumers who bore the burden of the duty. 6. Refund of Excise Duty and Interest: The Supreme Court of India dismissed an appeal, affirming the need for a refund due to unjust enrichment. A review petition was also summarily dismissed. The High Court directed the concerned authority to refund the excise duty with interest to the petitioner, following previous judgments and orders, within a specified timeframe. In conclusion, the judgment addressed various legal issues surrounding the imposition and refund of excise duty, legislative competence, discrimination in refund policy, unjust enrichment, and the authority's obligation to refund the duty with interest as per the court's direction.
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