9911796707
TMI Blog2024 (4) TMI 1035X X X X Extracts X X X X X X X X Extracts X X X X ..... y authorities as well as the Division Bench of the High Court rejected his case and imposed higher penalty under the old rule. 2.1 For the reasons to follow, we have accepted the contention of the appellant and, in allowing the appeal, determined that the purpose of the amendment is to achieve a proper balance between crime and punishment or the offence and penalty. In light of this, and recognizing that classifying offenders into before or after the amendment for imposing higher and lower penalties does not serve any public interest, we have directed that the substituted Rule alone will apply to pending proceedings. 3. Facts:- The appellant is a sub-licensee under the M.P. Excise Act, 1915 Hereinafter referred to as "the Act" for manufacture, import and sale of Foreign Liquor, regulated under the Madhya Pradesh Foreign Liquor Rules, 1996 Hereinafter referred to as "the 1996 Rules". 3.1 Sub-licensees importing Foreign Liquor are granted transit permits in which the origin, quality, quantity and point of delivery of the imported liquor are recorded. At the point of destination, the consignment is verified for quality and quantity, and a certificate under Rule 13 is granted. Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 10-B licensee shall be liable to pay penalty at a rate exceeding three times but not exceeding four times the maximum duty payable on foreign liquor at that time, as may be imposed by the Excise Commissioner or any officer authorized by him: Provided that if it be proved to the satisfaction of the Excise Commissioner or the authorized officer that such excess deficiency or loss was due to some unavoidable cause, like fire or accident and its first information report was lodged in Police Station, he may waive the penalty imposable under this sub-rule. (3) The Excise Commissioner or the Collector may suspend or cancel the license under Section 31 of the Act upon a contravention of any of these rules or provisions of the Act, or any other rules made under the Act, or the orders issued by the Excise Commissioner." 4. Facts reveal that no action was initiated during the license year of 2009-2010. 5. On 29.03.2011, Rule 19 was substituted by an amendment. The relevant portion of substituted provision is as follows: "Rule 19. Penalties Hereinafter, "the substituted Rule" (1)... (2) On all deficiencies in excess of the limits allowed under rule 16 and rule 17, the F.L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he substituted Rule. 10. The Division Bench of the High Court, by the order impugned herein, reversed the decision of the Single Judge on the simple ground that as the license was granted for one year, the Rule that existed during that license year must apply. The reason for not applying the substituted Rule according to the Division Bench is also that determination of penalty being substantive law, cannot operate retrospectively. 11. Questioning the legality and validity of the decision of the Division Bench of the High Court, the present appeals are filed. Mr. Pratap Venugopal, Ld. Senior Advocate, appearing on behalf of the appellant argued that the effect of substitution is to repeal the existing provision from the statute book in its entirety and to enforce the newly substituted provision. He would further submit that even for incidents which took place when the old Rule was in force, it is the substituted Rule that would be applicable, and therefore, the demand notice dated 22.11.2011 seeking payment of penalties under old Rule is illegal. 12. There is no difficulty in accepting the argument of Mr. Pratap Venugopal on principle. In Koteswar Vittal Kamath v. K. Rangappa Bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt held that the substitution had the effect of just deleting the old rule and making the new rule operative. In Mangilal Pindwal (1996) 5 SCC 60 case this Court upheld the legislative practice of an amendment by substitution being incorporated in the text of a statute which had ceased to exist and held that the substitution would have the effect of amending the operation of law during the period in which it was in force. In Koteswar case (1969) 1 SCC 255 a three-Judge Bench of this Court emphasised the distinction between "supersession" of a rule and "substitution" of a rule and held that the process of substitution consists of two steps: first, the old rule is made to cease to exist and, next, the new rule is brought into existence in its place." 12.2. A slight variation is noticed in a recent decision in Gottumukkala Venkata Krishamraju v. Union of India, (2019) 17 SCC 590 where this Court held that: "18. Ordinarily wherever the word "substitute" or "substitution" is used by the legislature, it has the effect of deleting the old provision and make the new provision operative. The process of substitution consists of two steps : first, the old rule is made to cease to exist a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e action, being an important subject of administrative law. 15. We will now refer to the rule making power under the M.P. Excise Act, 1915. Section 62 of the Act empowers the State to make rules. Relevant portion of Section 62 is as follows: - "62. Power to make rules.- (1) The State Government may make rules for the purpose of carrying out the provisions of this Act. (2) In particular, and without prejudice to the generality of the foregoing provision, the State Government may make rules- (a) prescribing the powers and duties of Excise Officers; (b) to (n) ... (3) The power conferred by this section of making rules is subject to the condition that the rules made under subsection (2) (a), (b), (c), (e), (f), (i), (l) and (m) shall be made after previous publication : Provided that any such rules may be made without previous publication if the State Government considers that they should be brought into force at once." 16. Section 62 does not enable the executive to continue the application of a repealed rule to events that have commenced during the subsistence of the Rule. However, Section 63 is of some importance. It enables the executive to operate the Rule fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nactment and not a subordinate legislation. Interpreting an identical provision of the General Clauses Act, 1897, i.e. Section 6, this Court has consistently held that Section 6 of the General Clauses Act, 1897, has no application to subordinate legislation. Rayala Corp. v. Director of Enforcement, (1969) 2 SCC 412; Kolhapur Canesugar Works Ltd. v. Union of India, (2000) 2 SCC 536 20. Mr. Saurabh Mishra then referred to Section 31 of Madhya Pradesh General Clauses Act, 1957, which is as under: "31. Application of Act to Ordinances and Regulations.- The provisions of this Act shall apply, unless there is anything repugnant in the subject or context- (a) to any Ordinance or Regulation as they apply in relation to Madhya Pradesh Acts: Provided that sub-section (1) of section 3 of this Act shall apply to any Ordinance or Regulation as if for the reference in the said sub-section (1) to the day of the first publication of the assent to an Act in the Official Gazette there were substituted a reference to the day of the first publication of the Ordinance or the Regulation, as the case may be, in that Gazette; (b) to the construction of rules, regulations, bye-laws, orders, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Devi v. Milkhi Ram (1990) 2 SCC 134 while explaining the purpose and object of prefacing a definition or an interpretation with the phrase- "unless there is anything repugnant in the subject or context"- this court held :- "19. The opening sentence in the definition of the section states "unless there is anything repugnant in the subject or context". In view of this qualification, the court has not only to look at the words but also to examine the context and collocation in the light of the object of the Act and the purpose for which a particular provision was made by the legislature. Reference may be made to the observations of Wanchoo, J. in Vanguard Fire and General Insurance Co. Ltd. v. M/s Fraser and Ross [(1960) 3 SCR 857, 863: AIR 1960 SC 971: (1960) 30 Com Cas 13] where the learned Judge said that even where the definition is exhaustive inasmuch as the word defined is said to mean a certain thing, it is possible for the word to have a somewhat different meaning in different sections of the Act depending upon the subject or context... 20. Great artistry on the bench as elsewhere is, therefore, needed before we accept, reject or modify any theory or principle. Law as cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court. Dr. Major Meeta Sahai v. State of Bihar, (2019) 20 SCC 17 The principle is aptly enunciated as: "The Court has the function of authoritatively construing legislation, that is, determining its legal meaning so far as is necessary to decide a case before it. This function is exclusive to the Court, and a meaning found by any other person, for example an authorising agency, an investigating agency, an executing agency, a prosecuting agency, or even the legislature itself, except when intending to declare or amend the law, is always subject to the determination of the court. It is usually said that the making of law, as opposed to its interpretation, is a matter for the legislature, and not for the courts, but, in so far as that legislature does not convey its intention clearly, expressly and completely, it is taken to require the court to spell out that intention where necessary. This may be done either by finding and declaring implications in the words used by the legislator, or by regarding the breadth or other obscurity of the express language as conferring a delegated legislative power to elaborate its meaning in accordance with public policy (including legal policy) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments to the rules. In this context, depending on the nature of offence, the proportionate penalty is required to be modulated from time to time. In light of this, we can appreciate that the felt need of the State to amend and substitute Rule 19 which provided a higher penalty at four times the duty, with a simple penalty not exceeding the duty payable. 32. If the amendment by way of a substitution in 2011 is intended to reduce the quantum of penalty for better administration and regulation of foreign liquor, there is no justification to ignore the subject and context of the amendment and permit the State to recover the penalty as per the unamended Rule. The subject of administration of liquor requires close monitoring and the amendment must be seen in this context of bringing about good governance and effective management. Seen in this context, the principle of Section 10 of MP General Clauses Act, 1957, relating continuation of a repealed provision to rights and liabilities that accrued during the subsistence of the Rule does not subserve the purpose and object of the amendment. 33. It is also submitted on behalf of the State that the substituted Rule cannot be given retrospect ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
