9911796707
TMI Blog2024 (11) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... the Constitution is both an industry-based entry and a product-based entry. The words that follow the expression that is to say in the Entry are not exhaustive of its contents. It includes the regulation of everything from the raw materials to the consumption of intoxicating liquor ; b. Parliament cannot occupy the field of the entire industry merely by issuing a declaration under Entry 52 of List I. The State Legislature s competence under Entry 24 of List II is denuded only to the extent of the field covered by the law of Parliament under Entry 52 of List I; c. Parliament does not have the legislative competence to enact a law taking control of the industry of intoxicating liquor covered by Entry 8 of List II in exercise of the power under Article 246 read with Entry 52 of List I; d. This Court in THE STATE OF BOMBAY AND ANOTHER VERSUS FN. BALSARA [ 1951 (5) TMI 3 - SUPREME COURT] and SOUTHERN PHARMACEUTICALS CHEMICALS TRICHUR ORS. VERSUS STATE OF KERALA [ 1981 (9) TMI 275 - SUPREME COURT] did not limit the meaning of the expression intoxicating liquor to its popular meaning, that is, alcoholic beverages that produce intoxication. All the three judgments interpreted the expressi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atters before an appropriate Bench. The order of above judges have been differed in few points by NAGARATHNA, J. - The decision as given by him are as follows:- a. Entry 8 List II deals with intoxicating liquors . The misuse, diversion or abuse of industrial alcohol as intoxicating liquors can also be controlled and prevented under Entry 8 List II by the State Legislatures having regard to Article 47 of the Constitution. It is also made clear that the IDRA which has been enacted by the Parliament by virtue of Entry 52 List I has taken control of Fermentation Industries as a scheduled industry. Such Fermentation Industries would exclude intoxicating liquors . b. Parliament can occupy the field of the entire industry by merely issuing a declaration under Entry 52 List I and the State Legislature s competence under Entry 24 List II is denuded to the field of the entire industry and specifically to the extent of the field covered by the law of Parliament under Entry 52 List I. c. The decision as given by above judges agreed. d. The context of the controversy must be borne in mind in the said cases. The aforesaid decisions in substance limited the meaning of the expression intoxicating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontext of what is comprised in the expression industrial alcohol and intoxicating liquors except what has been clarified above in Entry 8 List II. i. Item 26 of the First Schedule of the IDRA must be read excluding only what is contained in the expression intoxicating liquors as interpreted above in Entry 8 List II. j. Tika Ramji is held to be not good law insofar as the requirement of issuance of a notified order as a condition precedent for the field to be occupied, has been mandated therein. k. Denatured alcohol belongs to the family of industrial alcohol and therefore, Section 18G of the IDRA has a bearing on the said product. Section 18G occupies the field under Entry 33(a) List III and, thereby, only Parliament is competent to legislate on all articles or class of articles related to a scheduled industry i.e. Fermentation Industries . - With Special Leave Petition (C) .(CC) No. 7999 of 2017 With Special Leave Petition (C) No. 27241 of 2019 With Special Leave Petition (C) No. 18582 of 2023 With Special Leave Petition (C) No. 19275 of 2004 With Special Leave Petition (C) No. 16505 of 2004 With Special Leave Petition (C) No. 26110 of 2004 With Special Leave Petition (C) No. 26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Varun Bhadana, Adv. Mr. Keshav Mittal, Adv. Mr. Amit Ojha, Adv. Mr. Azeem A Dost, Adv. Mr. Lokesh Kumar Bidhuri, Adv. Ms. Sabarni Som, Adv. Mr. Prashant Sharma, Adv. Mr. Bhakti Vardhan Singh, Adv. Mr. Pati Raj Yadav, Adv. Mr. Fateh Singh, Adv. Mr. V. Giri, Sr. Adv. Mr. C. K. Sasi, AOR Ms. Meena K Poulose, Adv. Mr. Harsher Sunder, Adv. Mr. Nihar Dharmadhikari, Adv. Mr. Rao Vishwaja, Adv. Mr. Rahul Narang, Adv. Mr. Pankaj Bhagat, AOR Mr. Akshat Kumar, AOR For the Respondent : Mr. R Venkatramani, Attorney General for India Mr. Tushar Mehta, Solicitor General Mr. Shashank Bajpai, Adv. Ms. Sonali Jain, Adv. Mr. Mukesh Kumar Singh, Adv. Mr. Raman Yadav, Adv. Mr. Kartikay Aggarwal, Adv. Mr. Abhishek Kumar Pandey, Adv. Mr. Chitvan Singhal, Adv. Mrs. Ameyvikrama Thanvi, Adv. Mr. Raj Bahadur Yadav, AOR Mr. Tushar Mehra, Solicitor General Ms. Sansriti Pathak, Adv. Mr. Omar Ahmad, Adv. Ms. Tahira Karanjawala, Adv. Mr. Ishaan Gaur, Adv. Mr. Vikram Shah, Adv. Ms. Simran Jeet, Adv. Mr. Pratibhanu Kharola, Adv. Mr. Pratyush Shrivstava, Adv. Ms. Astha Singh, Adv. Mr. Tuhin Dey, Adv. Mr. Shreyas Maheshwari, Adv. Mr. Navanjay Mahapatra, Adv. Mr. Aaditya Shankar Dixit, Adv. Mr. Santosh Kumar, Adv. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Samar Vijay Singh, AOR Ms. Sabarni Som, Adv. Mr. Fateh Singh, Adv. Mr. Pukhrambam Ramesh Kumar, AOR Mr. Karun Sharma, Adv. Ms. Rajkumari Divyasana, Adv. Mr. R. Rajaselvan, Adv. Mr. Abhimanyu Bhandari, Sr. Adv. Ms. Rooh-e-hina Dua, AOR Mr. Arav Pandit, Adv. Mr. Harshit Khanduja, Adv. Ms. Dhanakshi Gandhi, Adv. Mr. Sahib Kochhar, Adv. Mr. Ankit Khera, Adv. Ms. Shreya Arora, Adv. Mr. Tushar Jarwal, Adv. Ms. Anuradha Dutt, Adv. Mr. Rahul Sateeja, Adv. Mr. Vikrant A Maheshwari, Adv. Ms. B. Vijayalakshmi Menon, AOR Mr. Praveen Chaturvedi, AOR Mr. Saurabh Mishra, Sr. Adv. Ms. Mrinal Gopal Elker, AOR Mr. Saurabh Singh, Adv. Mr. K N Balgopal, Adv. Gen/Sr. Adv. Ms. K. Enatoli Sema, AOR Ms. Limayinla Jamir, Adv. Mr. Amit Kumar Singh, Adv. Ms. Chubalemla Chang, Adv. Mr. Prang Newmai, Adv. Mr. Amit Kumar, Advocate General/Sr. Adv. Mr. Avijit Mani Tripathi, AOR Mr. Balbir Singh, Sr. Adv. Mr. Aaditya Aniruddha Pande, AOR Mr. Siddharth Dharmadhikari, Adv. Mr. Bharat Bagla, Adv. Mr. Naman Tandon, Adv. Mr. Sourav Singh, Adv. Mr. Aditya Krishna, Adv. Ms. Preet S. Phanse, Adv. Mr. Adarsh Dubey, Adv. Mr. Aravindh S., AOR Ms. Tharanisri, Adv. Mr. Akshay Gupta, Adv. Ms. Devina Sehgal, AOR Mr. D. L. Chida ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ta, Sr. Adv. Ms. Astha Sharma, AOR Mr. Srisatya Mohanty, Adv. Ms. Anju Thomas, Adv. Mr. Sanjeev Kaushik, Adv. Ms. Mantika Haryani, Adv. Mr. Shreyas Awasthi, Adv. Mr. Himanshu Chakravarty, Adv. Mr. Ridhi Boos, Adv. Mr. Ridhi Bose, Adv. Ms. Ripul Swati Kumari, Adv. Mr. Bhanu Mishra, Adv. Ms. Muskan Surana, Adv. JUDGMENT Dr Dhananjaya Y Chandrachud, CJI Table of Contents A. Background ................................................................................................... 5 i. Relevant constitutional provisions .......................................................... 5 ii. The judgment in Synthetics (7J) .............................................................. 8 iii. The aftermath of Synthetics (7J) ........................................................ 16 iv. The Reference Order(s) ........................................................................... 22 B. Submissions ................................................................................................ 26 i. Appellants submissions ........................................................................ 26 ii. Respondent s submissions ............................................................... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his reference pertain to the scope of the power of the State Legislatures under Entry 8 and the meaning of the phrase intoxicating liquor . The question is whether intoxicating liquor in Entry 8 only includes potable alcohol, such as alcoholic beverages or also includes alcohol which is used in the production of other products. In Synthetics and Chemicals Ltd. v. State of UP,1 ( Synthetics [7J]), a seven-Judge Bench delineated the scope of the regulatory powers of State Legislatures on intoxicating liquor . The correctness of Synthetics [7J] (supra) has been referred to a larger bench. We answer the reference in this judgment. i. Constitutional provisions 2. The State has the legislative competence under Entry 24 of List II over industries but this is subject to entries 7 and 52 of List I.2 Under Entry 52 of List I, Parliament has legislative competence over such industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest3. Entry 7 of List I deals with industries which are declared by Parliament by law to be necessary for the purpose of defence or for the prosecution of war.4 Under Entry 33 of List III, the State Legislature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... denatured spirit from the wholesale dealer of denatured spirit. The UP Excise Act was amended to include Section 24-A. Section 24-A provided that the Excise Commissioner may grant licence for the manufacture or sale of any foreign liquor . Foreign Liquor was defined in the subordinate Rules to include all rectified, perfumed, medicated and denatured spirit. 15 The constitutional validity of the amendment including Section 24-A was challenged before the Allahabad High Court. The High Court upheld the challenge. The UP State Legislature enacted the U.P Excise (Amendment) (Re-enactment and Validation) Act 1976 including Section 24-A relying on the decisions of this Court in Nashirwar v. State of MP16 and Har Shanker v. Dy. Excise and Taxation Commissioner17. The Allahabad High Court upheld the validity of the U.P Excise (Amendment) (Re-enactment and Validation) Act 1976.18 7. The appellants in Synthetics Chemicals v. State of UP19 ( Synthetics [2J] ), held licenses for wholesale vend of denatured spirit . They instituted proceedings under Article 226 of the Constitution before the Allahabad High Court for seeking a direction to quash the notification by which vend fee was levied from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e decision of this Court in Synthetics (2J) (supra). Writ petitions were also filed for challenging the rules by which vend fees were levied in Uttar Pradesh, and provisions of various laws enacted by the then State of Bombay, and the States of Tamil Nadu and Andhra Pradesh by which exclusive privilege of dealing with any intoxicant was vested in the State. The matters were heard by a seven-Judge Bench in Synthetics(7J) (supra). 10. Justice Sabyasachi Mukharji, writing for himself and five other judges framed the following issues for consideration: 2. The main question that falls for consideration in these matters is whether the vend fee in respect of the industrial alcohol under different legislations and rules in different States is valid. [ ] The questions with which we are mainly concerned are the following: Whether the power to levy excise duty in case of industrial alcohol was with the State legislature or the Central legislature; What is the scope and ambit of Entry 8 of List II of the Seventh Schedule of the Constitution? Whether, the State Government has exclusive right or privilege of manufacturing, selling, distributing etc. of alcohols including industrial alcohol. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot fit for human consumption28; b. The provisions that are challenged are not regulatory but seek to levy a tax.29 List II does not confer the State Legislature the power to levy of tax on industrial alcohol30; c. In view of Item 26 of the First Schedule to IDRA, the control of alcohol industries vests exclusively in the Union. Thus, the power to issue licenses to manufacture both potable and non-potable alcohol vests in the Central Government;31 d. The State can also not regulate industrial alcohol as a product of the controlled industry in terms of Entry 33 of List III because the Union occupies the whole field on industrial alcohol as evinced by Section 18G of the IDRA32; e. Even otherwise, the impugned provisions do not regulate a product of the scheduled industry. Rather, they deal with the manufacture and sale of industrial alcohol33; f. The power of the States to legislate on the subject of alcohol is restricted to laws which (paragraph 86 of Synthetics (7J) (supra)): i. Prohibit potable alcohol in terms of Entry 6 of List II which concerns public health; ii. Lay down regulations to ensure that non-potable alcohol is not diverted and misused as a substitute for potable alcoh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Khedut Sahakari Mandali v. State of Gujarat36, the constitutional validity of Section 58-A of the Bombay Prohibition Act 1949 was challenged. Section 58-A enabled the State Government to direct that the manufacture, import, export, transport, storage, sale, purchase, use, collection or cultivation of any intoxicant, denatured spiritous preparations, hemp, mhowra flowers or molasses would be in the supervision of persons appointed by them and the costs of such staff were required to be borne by the person engaged in the activity. This Court rejected the challenge. Relying on Synthetics (7J) (supra), the two-Judge Bench observed that though industrial alcohol is not covered by the regulatory powers under Entry 8 or the taxing power under Entry 51 of List II, the State has powers to ensure that industrial alcohol is not diverted to be used as potable alcohol and this is covered by Entry 33 of List III.37 This decision was followed by another two-Judge Bench in Gujchem Distillers India v. State of Gujarat38. 17. In State of AP v. McDowell39, the prohibition of sale and consumption of intoxicating liquor in the State of Andhra Pradesh was challenged. The petitioners submitted that the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... II) and nonpotable alcohol (over which the State did not have competence under Entry 8 of List II): 23. The line of demarcation can and should be drawn at the stage of clearance/removal of the rectified spirit. Where the removal/clearance is for industrial purposes (other than the manufacture of potable liquor), the levy of duties of excise and all other control shall be of the Union but where the removal/clearance is for obtaining or manufacturing potable liquors, the levy of duties of excise and all other control shall be that of the States. This calls for a joint control and supervision of the process of manufacture of rectified spirit and its use and disposal. 19. The decision further elucidated the realm of competence of the State and the Union with respect to (a) industries engaged in manufacturing rectified spirit meant exclusively for supply to industries; (b) industries engaged exclusively in manufacturing rectified spirit for production of potable alcohol; and (c) industries engaged in both of the above. This demarcation will be discussed in detail in the subsequent sections of the judgment. To understand the manner in which Bihar Distillery (supra) interpreted the judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is covered by paragraph 86(b) of the decision in Synthetics (7J). The Bench rejected the submission holding that the State Government is competent to levy fee to ensure that industrial alcohol (which the judgment used alternatively for ethyl alcohol) is not surreptitiously converted into potable alcohol so that the public is protected from consuming illicit liquor . However, the Bench relying on Vam Organic I (supra) noted that the power stops with denaturing and that even if denatured alcohol can be re-natured, the States would not have the power to regulate it. The relevant observations are extracted below: 43. [ ] We are of the view that the State Government is competent to levy fee for the purpose of ensuring that industrial alcohol is not surreptitiously converted into potable alcohol so that the State is deprived of revenue on the sale of such potable alcohol and the public is protected from consuming such illicit liquor. But this power stops with the denaturation of the industrial alcohol. Denatured spirit has been held in Vam Organics- I to be outside the seism of the State Legislature. Assuming that denatured spirit may by whatever process be renatured (a proposition which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y could arise, which Mr. Dwivedi urged, recognised the State s power to legislate with regard to matters under Entry 33 of List III notwithstanding the provisions and existence of Section 18-G in the 1951 Act. 27. Mr. Dwivedi then went on to refer to the judgment of this Court in SIEL Limited v. Union of India (1998) 7 SCC 26 wherein the learned Judges relying on the policy decision in Ch. Tikaramji s case (supra) explained and distinguished the decision of the 7 Judge Bench in Synthetics and Chemicals case (supra). [ ] 28. Yet another case referred to by Mr. Dwivedi was the decision of a Constitution Bench of 5 Judges of this Court in Belsund Sugar v. State of Bihar (1999) 9 SCC 620 [ ]. In the said case also it was observed by the Constitution Bench that in the absence of promulgation of any statutory order covering the filed under Section 18-G it could not be said that mere existence of a statutory provision for entrustment of such power would result in regulation of purchase and sale of flour even if it is a scheduled industry. It may be noted that even while noting the decision of the 7 Judge Bench in Synthetics and Chemicals case (supra) the Court placed reliance on the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18G of the IDRA, give rise to a presumption that it was the intention of the Central government to cover the entire field in respect of Entry 33 of List III so as to oust the States competence to legislate in respect of matters relating thereto? e. Does the mere presence of Section 18G of the IDRA, oust the State s power to legislate in regard to matters falling under Entry 33(a) of List III? f. Does the interpretation given in Synthetics (supra), in respect of Section 18G of the IDRA correctly state the law regarding the States power to regulate industrial alcohol as a product of the Scheduled industry under Entry 33 of List III in view of clause (a) thereof? 25. The batch was placed before a Constitution Bench pursuant to the above order. By an order dated 8 December 2010, the Constitution Bench observed that the decision in Synthetics (7J) (supra) requires to be considered by a Bench of nine Judges and directed the matter be placed before a larger Bench: Having meticulously examined the judgment of the Constitution Bench of seven learned Judges in the case of Synthetics and Chemical Limited Ors. vs. State of Uttar Pradesh Ors., reported in 1990 (1) SCC 109, we are of the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st II of the Seventh Schedule to the Constitution is a comprehensive phrase which connotes all liquids containing alcohol. Therefore, liquor and spirit including industrial alcohol have always been under the jurisdiction of States; f. The 1935 Act used different phrases in Entries 31 and 40 of List II of its Seventh Schedule. These entries are relatable to Entries 8 and 51 of List II of the Seventh Schedule to the Constitution respectively. Whereas the phrase alcoholic liquor for human consumption is used in Entry 51 List II for taxation purposes, Entry 8 of List II uses the word intoxicating liquors . Similarly, Entry 84 of List I uses the phrase alcoholic liquor not for human consumption and Article 47 uses the phrase intoxicating drinks . It would be irrational to presume that the framers of the Constitution used different phrases to mean the same thing; g. The term liquors used in a legislation under Entry 31 of List II of the Seventh Schedule to the 1935 Act was accepted to mean all alcoholic liquids by this Court in FN Balsara (supra). The language of Entry 8 of List II of the Seventh Schedule to the Constitution is borrowed from Entry 31 of List II of the Seventh Schedule to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e First Schedule to the IDRA. However, no corresponding declaration is made under Section 18G of the IDRA to satisfy the requirements of Entry 33, List III. The Central government would be required to issue a notified order under Section 18G of the IDRA to claim control over the product. No such order has been issued and therefore the product remains in the exclusive domain of the State. Therefore, the Union has not occupied the field under Entry 33, List III. 29. Mr Arvind Datar, learned senior counsel took us through the process of making denatured alcohol and potable liquor from molasses or grains. He argued that a license is required to make ENA and another license is required to make denatured spirit out of ENA. The process of denaturation is done before a State Excise Officer and the excise or duty payable against ENA and denatured spirit changes drastically. He argued that States can regulate potable alcohol as well as denatured spirits because the process of denaturing takes place within the same premises. 30. Mr Datar argued that the Synthetics (7J) (supra) must be overruled because: a. In para 74 of the judgment, this Court erred in assuming that industrial alcohol and re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the manufacture, possession, sale and transport of all alcohol and the Union government had no say in the matter. The Report clarified that there is no such thing as industrial alcohol and that rectified spirit which has 95% alcohol may be used for industrial and non-industrial purposes. Accordingly, the report opined that litigation on the issue be avoided by bringing an amendment to the IDRA, namely, the substitution of item 26 in the First Schedule to the IDRA with the phrase Fermentation Industries but not including alcohol. This was to enable the States to levy excise duties on alcohol which had been the case for over a century prior to the judgment of this Court in Synthetics (supra). Parliament did not amend the IDRA as suggested by the Law Commission but instead only excluded potable alcohol from the purview of the Union with retrospective effect from the commencement of the IDRA; and f. Synthetics (7J) (supra) must be overruled because it suffers from inconsistency in holding that the States have nothing to do with alcohol as well as holding that they can levy a regulatory fee.61 31. Mr Datar submitted that the phrase that is to say featuring in Entry 8 of List II of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e renatured and distributed as potable alcohol which will lead to tragedies. He argued that it becomes imperative for the State to regulate such instances under Entry 8 of List II as well as Entry 6 of List II which deals with public health. 34. Mr V Giri, learned senior counsel, differed from other counsel for the appellants and submitted that denatured alcohol would be excluded from the ambit of the term intoxicating liquors and would therefore fall under Entry 24 of List II. However, he supported the arguments of the other counsel on a notified order under Section 18G of the IDRA being a prerequisite for Parliament to occupy the field under Entry 33 of List III. 35. Mr Balbir Singh, learned senior counsel, and Mr Shadan Farasat and Dr. Vivek Sharma, learned counsel, have supported the above arguments on behalf of the appellants. ii. Respondent s submissions 36. Mr R Venkataramani, learned Attorney General for India appearing for the Union of India submitted that: a. The production, manufacture, trade and commerce, supply and distribution constitute a chain of economic activity and may not be looked at separately. Therefore, the process of production necessarily includes the seri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must be taken to have validly taken over non-potable alcohol; f. The focus of the framers while drafting the provisions concerning alcohol in the Constitution was temperance, regulation of trade and commerce in consumable alcohol preparations and to raise revenue; g. Entry 8 of List II cannot be interpreted to carve anything out of Entry 52, List I and Entry 33, List III. The judgment of this Court in ITC Ltd v. Agricultural Produce Market Committee,64 is inapplicable to the present case because ITC (supra) was determined in the context of overlapping entries. The fermentation industry has been dealt with under the IDRA, which is a self-contained legislation; h. The term intoxicating liquors in Entry 8 of List II does not include all classes of alcoholic liquids. The use of the phrase that is to say occurring in Entry 8 of List II only refers to the range of activities concerning one class of alcohol, namely potable alcohol, and is not referable to other classes of liquor; i. The framers of the Constitution may not have been aware of many industrial uses of alcohol and that all alcohol is neither consumable by humans nor intoxicating in nature; and j. The Report of the Industrial A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aspects; d. Tika Ramji (supra) must be overruled because: i. It did not consider the Constituent Assembly debates and wrongly restricted the meaning of industry to manufacturing and production only; ii. All aspects from the sourcing of raw materials to the distribution of products must fall within the powers of the Union to take control of an industry under Entry 52 of List I; iii. Article 366(12) did not define the term goods to include raw materials in particular; iv. Entry 27 of List II is subject to Entry 33 of List III. The implication of this aspect was not sufficiently dealt with by the Court in Tika Ramji (supra); and v. It is expedient in public interest that alcohol is regulated by a Central legislation. Currently, the IDRA occupies the field, and any State law on alcohol, other than potable alcohol, will be repugnant to the IDRA. The holding in Tika Ramji (supra), that there must be a notified order in force pursuant to Section 18G for there to be repugnancy is not correct. Further, it was obiter dicta; e. Synthetics (7J) (supra) rightly did not consider the observations in Tika Ramji (supra) regarding the absence of a notified order by the Union government; f. The debat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alf of the respondent. C. The distinction between potable and non-potable alcohol 39. Before delineating the issues that fall for the consideration of this Court, certain preliminary remarks on the process of preparation of potable alcohol, that is, alcohol that is used as a beverage must be made. The raw material for potable alcohol is generally molasses and grain66, which is fermented and distilled to produce rectified spirit. Rectified spirit, also known as ethyl alcohol, contains about 95% alcohol and some impurities which can affect flavour and aroma. Rectified spirit is used as a solvent in pharmaceutical and cosmetic products. Though rectified spirit is not generally used in the preparation of alcoholic beverages, it may be used to produce home-made liqueurs.67 Extra Neutral Alcohol is a highly purified form of ethanol which contains more than 96% alcohol. ENA has a neutral taste and smell and is mostly used as a base for the preparation of premium beverages. Additionally, it is also used in the production of products like perfumes and mouthwashes. Absolute alcohol is ethanol that contains less than 1% water and more than 99% alcohol.68 The high purity of the alcohol makes i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Seventh Schedule to the Constitution. E. Analysis i. The constitutional distribution of legislative power 43. One of the prominent features of a federal Constitution is the distribution of legislative powers between the Union and the States. Article 246 provides for the distribution of legislative powers between Parliament and the State Legislatures. Clause (1) of Article 246 stipulates that Parliament has exclusive power to make laws with respect to any matter enumerated in the Union List (List I to the Seventh Schedule) notwithstanding anything in the State or the Concurrent Lists. Clause (2) stipulates that Parliament and the State Legislatures have the power to legislate on any matter enumerated in the Concurrent List (List III of the Seventh Schedule) subject to the power of Parliament under Clause (1) but notwithstanding the power of the State Legislatures under Clause (3). Clause (3) provides that subject to clauses (1) and (2), the State Legislatures have the power to legislate on any matter enumerated in the State List (List II of the Seventh Schedule) of the Seventh Schedule. Further, Clause (4) provides for the power of Parliament to enact laws for Union Territories. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... flict between an entry in List I and entry in List II which is not capable of reconciliation 77, the power of Parliament to legislate with respect to a field covered by List I must supersede the exercise of power by the State legislature to that extent.78 The judgment also proceeded to lay down the manner in which the entries in List I and List II must be reconciled79: a. In case of a seeming conflict between the entries in the two lists, the entries must be read together without giving a narrow and restricted meaning to either of the entries in the Lists; and b. If the entries cannot be reconciled by giving a wide meaning, it must be determined if they can be reconciled by giving the entries a narrower meaning. 46. In State of WB v. Committee for Protection of Democratic Rights80, a Constitution Bench held that the principle of federal supremacy in Article 246 can be resorted to only when there is an irreconcilable direct conflict between the entries in List I and List II.81 ii. Scheme of legislative entries 47. The lists in the Seventh Schedule demarcate the legislative fields between Parliament and the State Legislatures. They do not confer power but stipulate broad fields of le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of List II is wider than the field of Entry 34 of List I. Hence the subjection of Entry 22 of List II to Entry 34 of List I indicates that that the field assigned to the States is circumscribed to the extent of the field assigned to Parliament in Entry 34 of List I. Barring the express legislative device of subordination, the States have complete power to enact laws over the fields specified in List II of the Seventh Schedule to the Constitution. The authority of the State Legislature to enact laws on those entries of List II which are not expressly made subject to other entries has maintained the federal balance of legislatures under the Constitution.86 50. The devices of language used in the Seventh Schedule prevent the overlap between entries in various Lists. Now, what of the instances where there is an overlap between provisions in different entries but the Constitution does not use a device to resolve it? It must be recalled that the federal supremacy of Parliament on legislative competence can only be resorted to when there is an irreconcilable direct conflict between entries in different lists. It is crucial to note the difference between overlap and conflict . An overlap o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... example, Entry 71 of List I deals with the field of Union Pensions . The phrase that is to say is then used to specify the meaning of the phrase Union Pensions as pensions payable by the Government of India or out of the Consolidated Fund of India94. This specification operates more or less as a definition clause. Second, the phrase is used to specify the scope of the provision. For example, Entry 5 of List II reads as local government, that is to say, the constitution and powers of municipal corporations, improvement trusts 95 Entry 8 falls in the latter category. 54. The next question is whether the phrase that is to say used in Entry 8 limits or explains the scope of the entry. The interpretation of the phrase that is to say has fallen for the consideration of this Court earlier in numerous cases.96 This Court has adopted both views. Benches have interpreted the expression as a limiting as well as an explanatory device. In Bhola Prasad v. The King Emperor97, the Federal Court dealt with the meaning of the phrase that is to say in Entry 31 of the Provincial List in the 1935 Act. Entry 31 of the Provincial List read as Intoxicating liquors and narcotic drugs, that is to say, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsport, purchase and sale of Intoxicating Liquor. II. Product or industry based entry 56. The Seventh Schedule differentiates between an industry and the product of the industry. Entry 24 of List II deals with industries. Entries 26 and 27 of List II deal with products of industries. Entry 26 deals with Trade and commerce within the State subject to the provisions of Entry 33 of List III . Entry 27 provides for Production, supply and distribution of goods subject to the provisions of Entry 33 of List III . Entry 33 of List III enables both Parliament and the State Legislature to enact laws with respect to trade and commerce in, and the production, supply and distribution of, inter alia, the products of the industry where control by the Union is declared by Parliament by law to be in the public interest. Thus, if the Union has control over an industry under Entry 52 of List I, both Parliament and the State Legislature will have the competence with respect to the products in terms of Entry 33 of List III. Under Entries 26 and 27 of List II, the State Legislature has the exclusive power to enact laws with respect to the products of the industries covered by Entry 24 of List II. Parlia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gulate everything from the stage of the raw materials to the consumption of intoxicating liquor . Entry 8 of List II includes both the industry and the product of intoxicating liquor . b. Scope of Entry 52 of List I: the absence of to the extent to which 59. Entry 24 of List II deals with Industries . The entry is subject to entries 7 and 52 of List I. Entry 7 of List I deals with industries which are declared by Parliament by law to be necessary for the purpose of defence or for the prosecution of war. Entry 52 of List I deals with industries, the control of which by the Union is declared by Parliament to be expedient in the public interest. The State Legislature will have the competence to enact laws with respect to industries . However, Parliament has the power to deal with such industries which are necessary to be in the control of the Union for: (a) public interest; (b) defence; and (c) prosecution of war. Thus, the State Legislature will have the competence to enact laws with respect to all industries, unless Parliament has taken control of the industry under Entries 52 or 7 of List I. 60. A comparison may be drawn to Entry 54 of List I and Entry 23 of List II to cull out the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant observations are extracted below: 7. [ ] Entry 52 List I on its own language does not contemplate a bald declaration for assuming control over specified industries, but the declaration has to be by law to assume control of specified industries in public interest. The legislation enacted pursuant to the power to legislate acquired by declaration must be for assuming control over the industry and the declaration has to be made by law enacted, of which declaration would be an integral part. Legislation for assuming control containing the declaration will spell out the limit of control so assumed by the declaration. Therefore, the degree and extent of control that would be acquired by Parliament pursuant to the declaration would necessarily depend upon the legislation enacted spelling out the degree of control assumed. A mere declaration unaccompanied by law is incompatible with Entry 52 List I. A declaration for assuming control of specified industries coupled with law assuming control is a prerequisite for taking legislative action under Entry 52 List I. The declaration and the legislation pursuant to declaration to that extent denude the power of State Legislature to legisla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... balance in a unique way. The members of the Constituent Assembly thought it fit to include industries as a legislative field in the State List because it requires localized focus. If the draftspersons thought otherwise, they could have included the Entry in the Union List or even the Concurrent List. The unique placement of these entries must be considered and given due effect. The entries must not be interpreted in a manner that would, in effect for all purposes, place the entry in the Concurrent List. 65. The question is whether an implied limitation can be read into Entry 52 of List I in the absence of the expression to the extent to which . If an implied limitation is not read into the Entry, Parliament by a simple declaration may take over the complete industry and subject the power of the State Legislature to make any provision with respect to that industry to the power of Parliament. This interpretation diminishes the scope of competence of the State Legislature under Entry 24 of List II. Such an interpretation completely tilts the federal balance that entries 52 of List I and 24 of List II seek to maintain. The power of Parliament in Entry 52 of List I is defined by the ph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire field of industry while Entry 25, the specific industry of gas and gas works;120 and c. Parliament cannot enact laws on the gas industry under Entry 52 because the meaning of industry in Entry 24 of List II and Entry 52 of List I is the same. Since Entry 24 does not cover the gas industry, it cannot be included in Entry 52 as well.121 68. In McDowell (supra), the constitutional validity of the Andhra Pradesh Prohibition Act 1995 was under challenge. The enactment prohibited the selling, buying, consumption and manufacture of liquor. It was submitted that the State did not have the competence to enact the statute because the manufacture and production of intoxicating liquors is an industrial activity covered by Item 26 of the Schedule to IDRA. It may be recalled that Item 26 before the 2016 amendment included alcohol and other products of fermentation industry. The three-Judge Bench of this Court rejected the submission. Justice Jeevan Reddy, writing for the Bench, observed that: a. Entry 8 expressly refers to production and manufacture of intoxicating liquor. Including the production and manufacture of liquor in Entry 24 of List II (and as a consequence in Entry 52 of Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ective of whether the term industry is interpreted in a narrow or a wide manner (a point that is vehemently contested by both sides), the industry of intoxicating liquor cannot be taken over by Parliament under Entry 52 of List I for the following reasons: a. The general principle is that legislative lists must be interpreted widely. The question that the Court must pose is whether the two entries would overlap when interpreted widely. If they overlap, the Court must reconcile them. But the method of reconciliation must maintain the federal balance. The courts must not apply the principle of legislative supremacy of Parliament at the stage of reconciliation. As explained above, such an exercise would tilt the federal balance towards the Union; b. The only limitation in Entry 52 is that the control of the industry by the Union must be necessary for public interest. Parliament can legislate on any industry, provided that it satisfies the condition prescribed in the Entry. Thus, Entry 52 when read independent of any other entry of List I, List II and List III does not preclude the inclusion of the industry of intoxicating liquor (provided that the Union is able to prove that its contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ries covered by Entry 52 of List I is placed in Entry 33 of List III. 72. As a consequence, Parliament does not have the legislative competence to enact a law taking control of the industry of intoxicating liquor under Entry 52 of List I. iv. Scope of Entry 8: Meaning of intoxicating liquor 73. Entry 8 of List II is a general entry and not a taxing entry. However, it is a special entry in the sense that it specifically enumerates intoxicating liquors as a legislative field to the exclusion of all other general entries under which it may have otherwise been subsumed. The Entry stipulates that intoxicating liquors would fall within the legislative domain of States. The arguments of the counsel on either side on the scope of Entry 8 of List II rest on the interpretation of the expression intoxicating liquor . 74. The appellants rely on the meaning of liquor in statutes which predate the Constitution to argue that the framers of the Constitution were aware of the sense in which the phrase was used at the time and, that it included denatured alcohol. In response, the Union argues that the word intoxicating occurring in the expression intoxicating liquors must not be rendered redundant b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... II of the 1935 Act did not include all liquids with alcohol, and thus, the definition was beyond the scope of the State Legislature. The reasons for the interpretation were thus: a. Liquor ordinarily means a strong drink as opposed to a soft drink. In any event, it must be a beverage which is ordinarily drunk; b. The difference in the words qualifying liquor in entries 31132 and 40(a)133 of List II in the 1935 Act (the Entry corresponding to Entry 51 of List II of the Seventh Schedule to the Constitution) is very significant. In Entry 31, the word used is intoxicating . In Entry 40(a), the word used is alcoholic . In the Whitepaper of 1933, the entry dealt with alcoholic liquor which was substituted with the expression intoxicating liquor. With the substitution, non-intoxicating liquor was excluded from the scope of the Entry; and c. Medicinal and toilet preparations containing alcohol are neither liquor nor intoxicating. Thus, they are excluded from the scope of the Entry. The 18th amendment to the US Constitution prohibits the sale, manufacture and transportation of intoxicating liquor .134 The petitioners relied on judgments of the US Supreme Court to substantiate the submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Seventh Schedule to the 1935 Act included not only beverages which intoxicate but also all liquids containing alcohol. While this may not have been the meaning attributed to intoxicating liquors in common parlance, the numerous statutory definitions made it clear that the expression in Entry 31 of List II of the 1935 Act was broad and included all liquids containing alcohol.138 78. The Constitution Bench also approached the question from the perspective of the entries on public health and public order , and Article 47139 of the Constitution. The Bench noted that the word liquor must be given a wide meaning to include all alcoholic liquids which may be used as substitutes for intoxicating drinks, to the detriment of health. 140 On the consideration of the meaning of the phrase, both from the perspective of legislative meaning and the constitutional directive of prohibiting intoxicating drinks which are injurious to health, this Court reversed the finding of the High Court.141 79. Though the High Court held that the definition of liquor in the Bombay Prohibition Act is ultra vires and this Court reversed the finding, there is one commonality between both the decisions. Neithe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spirit is not misused under the pretext of being used for medicinal and toilet preparations containing alcohol. It was argued that this definition was therefore ultra vires the powers of the State legislature, which could only make laws related to alcoholic beverages. (emphasis supplied) 81. The observations of this Court in Southern Pharmaceuticals (supra) follow the precedent in FN Balsara (supra) that preparations which contain alcohol will be covered by the phrase intoxicating liquor in Entry 8 to prevent its noxious use . In Indian Mica (supra), the appellant challenged the vires of the rule levying licence fee to possess denatured spirit. The Rules were framed under the Bihar and Orissa Excise Act 1915. The State would have the competence to enact a law levying fee on denatured spirit under Entry 66 of List II145 if the spirit was covered by the phrase intoxicating liquor in Entry 8 of List II. Denatured spirit in this case was used as a raw material for the preparation of another product (micanite). In this case, the Constitution Bench held that denatured spirit is intoxicating liquor and thus, covered by Entry 8 of List II.146 Further it was held that the fee charged will b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpreting legislative entries, that the entries must be conferred the widest meaning possible. Interpreting a phrase or words in the Legislative Lists based on the legal import of the phrase is, thus, in many ways an exception to the settled principle of interpreting entries. This is for the simple reason that the legislative entries delimit the scope of competence of the legislative bodies. If the entries are interpreted based on the meanings or definitions in a legislation, the purpose of the Seventh Schedule may become redundant. Further, the statute does not define phrases based on popular or common parlance meaning but rather based on the scope of the legislation and the manner in which the provisions are drafted. A deeming fiction is often used to define phrases by conferring artificial meanings.152 The interpretation based on legislative meaning elucidated in Gannon Dunkerley (supra), which narrows the interpretation of entries, thereby creating an exception to the rule of wide interpretation should only be employed by Courts when the twin tests highlighted above. The tests are (a) the phrase should have acquired a well-recognised, definite and precise meaning in law; and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are fit for use for beverage purposes. The Licensing (Consolidating Act) 1872 Intoxicating liquor means (unless inconsistent with the context) spirits, wine, beer, porter, cider, perry and sweets, and any fermented, distilled, or spiritous liquor which cannot, according to any law for the time being in force, be legally sold without an excise law.164 Spirits Act 1880 Spirits means spirits of any description, and includes all liquids mixed with spirits, and all mixtures, compounds, or preparations made with spirits.165 87. The Abkari Acts have generally defined the phrase liquor to mean liquids containing alcohol including denatured alcohol. However, the Abkari Acts do not define the phrase intoxicating liquor . In Excise Acts, liquor was defined to mean intoxicating liquor and included liquids containing alcohol. Thus, none of the pre-constitutional statutes have defined the phrase intoxicating liquor for it to have acquired a legal meaning. The phrase was defined in the Licensing (Consolidating Act) 1910 which regulated the United Kingdom. It cannot be concluded that the phrase used in the Indian Constitution has acquired a legal meaning based on a definition clause in one statut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pposed to intoxicating liquor . However, it must be noted that the provision deals with both alcoholic liquor and intoxicating drugs . 90. The approach adopted in the 1935 Act differed from the 1919 Act. Entry 45 of List I of the Seventh Schedule to the 1935 Act stipulated the federal domain over duties of excise. It is reproduced below: 45. Duties of excise on tobacco and other goods manufactured or produced in India except (a) alcoholic liquor for human consumption; (b) opium, Indian hand and other narcotic drugs and narcotics; non-narcotic drugs; (c) medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this entry. 91. Alcoholic liquor for human consumption was among the three categories which was excluded from the ambit of legislative competence of the Federal legislature. Entries 31 and 40 of List II of the Seventh Schedule to the 1935 Act stipulated the Provincial legislative domain over intoxicating liquors and narcotics, and duties of excise respectively. They are reproduced below: 31. Intoxicating liquors and narcotic drugs, that is to say, the production, manufacture, possession, transport, purchase and sale of intoxicating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 93. The Seventh Schedule to the Constitution also placed the regulatory powers and the taxing powers relating to alcohol in separate entries. Entry 8 of List II of the Seventh Schedule to the Constitution deals with intoxicating liquors . Entry 8 of List II of the Seventh Schedule to the Constitution varies from Entry 31 of List II of the 1935 Act in a significant manner. Entry 8 only deals with intoxicating liquor . It does not cover narcotic drugs and opium. Entry 31 conferred the Provincial Legislature, the competence to legislate with respect to narcotic drugs which included opium. It was subject to Entries in List I and List II which dealt with opium167 and poison and dangerous drugs 168. The Seventh Schedule to the Constitution placed opium in List I169 and List III170, completely removing it from List II. 94. Entry 84 of List I deals with duties of excise of goods except a few. The Entry read as follows before the Constitution (One Hundred and First Amendment) Act 2016: 84. Duties of excise on tobacco and other goods manufactured or produced in India except- (a) Alcoholic liquors for human consumption (b) Opium, Indian hemp and other narcotic drugs and narcotics, But inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iquor 175 and the Provincial List conferred States the competence to levy excise duty on potable alcoholic liquor 176; and (b) the regulatory provision in List II dealt with the production, manufacture, possession, transport, purchase and sale of liquors, opium and other drugs and narcotics not covered by item 19 of List III. 177 99. Two revisions were further made to the entries as they appear in the Government of India Bill 1935 which were subsequently reflected in the Government of India Act 1935. The phrase potable alcoholic liquor was substituted with the phrase alcoholic liquor in the taxing entry and the phrase liquor was substituted with the phrase intoxicating liquor in the regulatory entry. The table below reflects the evolution of the Legislative entries relating to alcohol : Enactment Taxing Entry Regulatory Entry Devolution Rules alcoholic liquor 178 White Paper alcoholic liquor 179 alcoholic liquor 180 Joint Select Committee on Indian Constitutional Reform potable alcoholic liquor 181 liquor 182 Government of India Act 1935 alcoholic liquor for human consumption 183 intoxicating liquor 184 Constitution of India alcoholic liquor for human consumption 185 intoxicating l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se. 103. We are unable to trace the discussions that led to a further revision in the 1935 Act, where the expression potable liquor was substituted with alcoholic liquor for human consumption , and liquor was substituted with the expression intoxicating liquor . However, it is clear that the use of the phrases as they appear in the relevant entries of the 1935 Act and the Constitution of India was a matter well-thought of. 104. Another point that needs to be noted based upon a study of the evolution of legislative entries is that until the 1935 Act, the regulatory entry covered narcotic drugs and opium along with alcoholic liquor / liquor / intoxicating liquor . There are two possible interpretations of the expression intoxicating liquor , as it appeared in the 1935 Act, on an application of the principle of noscitur a sociss, that is, the principle by which the meaning of an ambiguous expression may be ascertained by reference to the meaning of the words associated with it189. It could be interpreted to mean liquor that has an intoxicating effect upon consumption since narcotic drugs and opium also produce intoxication. The expression intoxicating liquor could also mean the regula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. It is settled law that the Legislature cannot derive taxation powers from a general regulatory entry.191 Thus, the lack of competence to levy tax on products other than alcoholic beverage cannot influence the interpretation of the regulatory entry. They operate in separate spheres. We now proceed to interpret the phrase intoxicating liquor . 109. The Oxford English Dictionary provides multiple meanings of the word Liquor . They include: (a) alcoholic drinks, especially spirits; (b) water used in brewing; (c) liquid that has been produced in or used for cooking; and (d) liquid from which a substance has been crystallized or extracted. Liquor thus broadly takes two meanings, of an alcoholic beverage or liquid. The word intoxicate is defined to mean: (a) cause someone to lose control of their senses; (b) poison; and (c) excite or exhilarate. 110. The dictionary meanings of the phrases liquor and intoxicate are variable. If liquor is interpreted to mean liquid instead of an alcoholic beverage and intoxication a reference to alcohol, the Entry would cover all liquids that contain alcohol. However, if liquor is interpreted to mean alcoholic beverage, the Entry would only cover alcoho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... second difference is the use of the expression intoxicating instead of alcoholic as the adjective to liquor. The following inferences can be drawn from the above differences: a. Alcoholic liquor defines the scope of the provision based on the ingredient, that is, alcohol . In contrast, intoxicating liquor defines the scope of the provision based on the effect, that is, intoxication. Thus, even liquor which colloquially or traditionally is not considered as alcoholic liquor may be covered by the phrase intoxicating liquor if it produces the effect of intoxication; b. Intoxicate means the ability of someone to lose control of their behaviour. It could also mean poison. Thus, the purpose of substituting the adjective which indicates the ingredient (alcohol) with the impact (intoxication) seems to be enhance the scope of the Entry to cover liquor which has an impact on health; and c. The public interest purpose of the provision is evident from the accompanying words in the provision which includes every stage from its production to consumption within the scope of the Entry. The public interest purpose of the provision is also evident from the evolution of the Entry. The relevant entry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ol, are prone to be misused. 114. It is not disputed that denatured alcohol is prepared by adding substances which are called denaturants to give the alcohol a foul smell and taste. The very purpose of denaturing ethanol to prepare denatured alcohol is to make it undrinkable. This Court in VAM Organic (II) (supra) held that the State can regulate the process of preparing denatured alcohol because it is done to ensure that the public is protected from consuming illicit liquor but not the product of denatured spirit even if it can be renatured and converted to potable liquor.193 The petitioners further sought to make a classification between Specially Denatured Alcohol and Completely Denatured Alcohol. It was argued that though Specially Denatured Alcohol is not fit for human consumption, it can be made potable by certain recovery processes while there is no such possibility in Completely Denatured Alcohol.194 It was argued that Entry 8 must at the least cover Specially Denatured Alcohol. The issue of whether denatured alcohol can be renatured to produce potable alcohol is immaterial for the purposes of delineating the field of Entry 8 of List II. As held above, Entry 8 does not only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t user was not comprehended or understood. With the passage of time, meanings do not change but new experiences give new color to the meaning. 117. These observations are erroneous for the following reasons: a. The High Court in FN Balsara v. State of Bombay (supra) did not limit the meaning of intoxicating liquor to its common parlance meaning, that is, potable alcoholic liquor. It also included alcoholic liquids which are not normally consumed as drinks. On appeal, the Constitution Bench held that a wider definition of intoxicating liquor is necessary to cover other products which may be used as substitutes for intoxicating drinks. [See section E (iv)(a) of this judgment]. This Court held that the expression must be given a wide meaning precisely because it recognised the potentiality of the wide use of alcohol for industrial purposes and its consequent misuse; and b. The Constitution itself recognises the industrial use of alcohol. Entries 84 of List I (before the amendment in 2016) and 51 of List II specifically refer to medicinal and toilet preparations containing alcohol. Thus, the use of alcohol for industrial preparations was well within the knowledge of this Court in FN Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by IDRA and that in view of IDRA, the power to issue licences to manufacture both potable and non-potable alcohol is vested in the Central Government.197 These observations are erroneous for the following reasons: a. Under Entry 52 of List I, Parliament has the competence to enact laws with respect to certain industries, the control of which by the Union is necessary in public interest. It is a general entry. It does not confer any taxing power. Thus, Entry 52 of List I may only impact the entries in List II that deal with the regulatory aspect of industries as we have explained in the previous section of this judgment. It does not have any impact on taxing entries. Thus, the observation in paragraph 84 of Synthetics (7J) (supra) is overruled; and b. We have also held that Parliament in exercise of the power under Article 246 read with Entry 52 of List I cannot legislate with respect to the field covered by Entry 8 of List II. The observations in paragraph 85 of Synthetics (7J) (supra) that after the amendment to IDRA in 1956 bringing fermentation industries within the scope of the enactment, the Union has competence over both potable and non-potable alcohol is overruled. The law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion in Indian Mica (supra) to arrive at this conclusion. In paragraph 3 of Indian Mica (supra), the Constitution Bench held as follows: Denatured spirit though an alcoholic liquor is not fit for human consumption. The power to levy duty on the same was and is given to the Central Legislature. But the same being intoxicating liquor, the Provincial Legislature under the 1935 Act and at present the State Legislature has power to levy fee. The power of any Legislature to levy fee is conditioned by the fact that it must be by and large a quid pro quo for the services rendered. ( emphasis supplied ) 125. The conclusion in Indian Mica (supra) that the State Legislature has the competence to levy fees on denatured alcohol (which this Court in Synthetics (7J) (supra) interchangeably uses with industrial alcohol) is premised on the wide interpretation of the phrase intoxicating liquor in Entry 8 of List II to include denatured alcohol. However, this Court in Synthetics (7J) (supra) expressly rejected this interpretation. The State Legislature would have the competence to levy fees in terms of Entry 66 of List II in respect of any of the matters in the List. Thus, the conclusion in paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cerned has no power or authority to control and regulate industry B and that the Union alone will control and regulate it until the potable liquors are manufactured? The Union is certainly not interested in or concerned with manufacture or process of manufacture of country liquor or IMFLs. Does this situation not leave a large enough room for abuse and misuse of rectified spirit? It should be remembered that according to many States before us, bulk of the rectified spirit produced in their respective States is meant for and is utilised for obtaining or manufacturing potable liquors. Can it be said even in such a situation that the State should fold its hands and wait and watch till the potable stage is reached. It is these and many other situations which have to be taken into consideration and provided for in the interests of law, public health, public revenue and also in the interests of proper delineation of the spheres of the Union and the States. The line of demarcation can and should be drawn at the stage of clearance/removal of the rectified spirit. Where the removal/clearance is for industrial purposes (other than the manufacture of potable liquor), the levy of duties of exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emoval or clearance of alcohol would be under the joint supervision of the Union and the States to ensure that excise duty was not evaded. 129. In Bihar Distillery (supra), the issue before this Court was whether the State has the competence to regulate raw material ( rectified spirit ) for the preparation of intoxicating liquor which was interpreted to only mean potable liquor. Justice Jeevan Reddy, writing for the three-Judge Bench, saw it fit to draw a purpose based delineation because rectified spirit could be used to prepare both potable alcohol and other products. The shortcoming of this reasoning is evident in the manner in which the Bench deals with composite industries, that is, industries which manufacture both rectified spirit for the purpose of potable alcohol and the production of other products. The regulation of such composite industries was held to be with the Union though there was no constitutional basis for such a division. This Bench, having expounded on the meaning of intoxicating liquor to include variants of alcohol which are prone to be misused, the interpretations of Synthetics (7J) summarised in paragraph 126 of this judgment are overruled. The classificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above judgment of the Supreme Court, the Law Commission of India had recommended in its 158th Report that the Heading 26 of the First Schedule to the Act be substituted as Fermentation Industries but not including Alcohol . The recommendation of the Law Commission of India was examined in depth by the Government. If the subject Alcohol is taken out of the First Schedule to the Act, both industrial alcohol and potable alcohol would come under the purview of the State Government which is not in consonance with the judgment of the Supreme Court. Moreover, the effect of implementation of the recommendation of the Law Commission would be that the subject Alcohol which covers both industrial alcohol and potable alcohol would no longer be a Central subject. ( emphasis supplied ) 131. The Statement of Objects and Reasons indicates that the recommendation of the Law Commission was not accepted because the effect of accepting the recommendation would be that both industrial alcohol and potable alcohol would be in the domain of the States, and that this would be contrary to Bihar Distillery (supra). Hence, the IDRA was amended to remove only potable alcohol from Item 26 of IDRA. 132. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meaning of process of production and manufacture; c. Section 18G of the IDRA enables the Union Government to regulate supply and distribution, and trade and commerce of certain articles . It does not extend to the production of articles. Raw materials are essential ingredients for manufacture or production but they are not of the same nature or description as the articles produced by the process of manufacture. The articles or class of articles relatable to the scheduled industry could only comprise of finished products of a cognate character. Raw materials, not being finished products, are not articles which are relatable to the scheduled industry covered by Section 18G206; d. Sugarcane is a raw material for the production of sugar. Consequently, it is not an article relatable to the sugar industry and does not fall within the scope of Section 18G. The IDRA did not affect the legislative powers of the State Legislature with respect to sugarcane. Therefore, the UP Sugarcane Act was not repugnant to the IDRA207; and e. Even if it were assumed that sugarcane was relatable to the sugar industry under Section 18G, the Central Government had not issued a notified order, as required by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i (supra) is not relevant to the dispute for the following reasons: a. We have interpreted the phrase intoxicating liquor in Entry 8 to include ENA since it could be noxiously used; and b. Notwithstanding the above, if the ground for overruling the holding in Tika Ramji (supra) is that manufacture/production cannot be disconnected from raw materials, it would equally apply to the industry of intoxicating liquor covered by Entry 8 of List II. In Section C (iii)(a) of this judgment, we have concluded that the words that is to say are illustrative. They are not exhaustive of the contents of the Entry. Thus, Entry 8 cannot be interpreted to exclude raw materials used for the production of intoxicating liquor merely because the Entry does not expressly provide for them. On an application of the principle that entries ought to be interpreted widely, the raw materials for the production and manufacture of intoxicating liquor, as interpreted in this judgment will be covered by Entry 8. viii. Section 18G of IDRA and Entry 33 of List III 139. To recall, this Court in Synthetics (7J) (supra) held that the State cannot regulate industrial alcohol as a product of the controlled industry because ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... embly were aware of use of the variants of alcohol as a raw material in the production of multiple products; g. Entry 8 of List II is based on public interest. It seeks to enhance the scope of the entry beyond potable alcohol. This is inferable from the use of the phrase intoxicating and other accompanying words in the Entry. Alcohol is inherently a noxious substance that is prone to misuse affecting public health at large. Entry 8 covers alcohol that could be used noxiously to the detriment of public health. This includes alcohol such as rectified spirit, ENA and denatured spirit which are used as raw materials in the production of potable alcohol and other products. However, it does not include the final product (such as a hand sanitiser) that contains alcohol since such an interpretation will substantially diminish the scope of other legislative entries; h. The judgment in Synthetics (7J) (supra) is overruled in terms of this judgment; i. Item 26 of the First Schedule to the IDRA must be read as excluding the industry of intoxicating liquor , as interpreted in this judgment; j. The correctness of the judgment in Tika Ramji (supra) on the interpretation of word industry as it occ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 150 g. Calcutta Gas Company 152 16. Entry 33(a) List III vs. Entry 52 - List I: Observations in Synthetics and Chemicals (7J) 172 17. Article 254, Repugnancy and Doctrine of Occupied Field 183 18. Mineral Area and Development Authority 195 19. Mar Appraem Kuri Company 204 20. Importance of Industrial Alcohol to the Indian Economy 213 21. Conclusion on interplay of legislative Entries 221 22. Effect of overruling Synthetics and Chemicals (7J) 224 23. My answers to the questions formulated 231 24. My answers to the conclusions of learned Chief Justice 235 I have perused the comprehensive and erudite opinion authored by Hon ble the Chief Justice of India Dr. Dhananjaya Y. Chandrachud on the questions referred to this nine-Judge Bench. I respectfully dissent on certain aspects of the said opinion and express my reasons therefor. 1.1 The sum and substance of all the questions referred to this Bench could be crystallised on the short point for consideration, namely, whether the expression intoxicating liquors in Entry 8 -List II of the Seventh Schedule of the Constitution of India includes within its scope and ambit industrial alcohol and consequently, whether a State Legislature has t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the following questions were formulated for consideration by a larger Bench: Q. 1. Does Section 2 of the Industries (Development and Regulation) Act, 1951, have any impact on the field covered by Section 18-G of the said Act or Entry 33 of List III of the Seventh Schedule of the Constitution? Q. 2. Does Section 18-G of the aforesaid Act fall under Entry 52 of List I of the Seventh Schedule of the Constitution, or is it covered by Entry 33 of List III thereof? Q. 3. In the absence of any notified order by the Central Government under Section 18-G of the above Act, is the power of the State to legislate in respect of matters enumerated in Entry 33 of List III ousted? Q. 4. Does the mere enactment of Section 18-G of the above Act, give rise to a presumption that it was the intention of the Central Government to cover the entire field in respect of Entry 33 of List III so as to oust the States' competence to legislate in respect of matters relating thereto? Q. 5. Does the mere presence of Section 18-G of the above Act, oust the State's power to legislate in regard to matters falling under Entry 33(a) of List III? Q. 6. Does the interpretation given in Synthetics and Chemical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e test laid down in Ganon Dunkerley (supra); f. The study of the evolution of the legislative entries on alcohol indicates that the use of the expressions intoxicating liquor and alcoholic liquor for human consumption in the Seventh Schedule was a matter well-thought of. It also indicates that the members of the Constituent Assembly were aware of use of the variants of alcohol as a raw material in the production of multiple products; g. Entry 8 of List II is based on public interest. It seeks to enhance the scope of the entry beyond potable alcohol. This is inferable from the use of the phrase intoxicating and other accompanying words in the Entry. Alcohol is inherently a noxious substance that is prone to misuse affecting public health at large. Entry 8 covers alcohol that could be used noxiously to the detriment of public health. This includes alcohol such as rectified spirit, ENA and denatured spirit which are used as raw materials in the production of potable alcohol and other products. However, it does not include the final product (such as a hand sanitiser) that contains alcohol since such an interpretation will substantially diminish the scope of multiple other legislative e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rect. The expression intoxicating liquors in Entry 8 List II of the Seventh Schedule of the Constitution cannot be restricted to alcoholic liquors for human consumption by a deduction from a reading of Entry 84 List I with Entry 51 List II. In other words, intoxicating liquors cannot be equated with only alcoholic liquors for human consumption . On the other hand, it is contended that the expression intoxicating liquors has attained a specific meaning over the passage of time which is more expansive than alcoholic liquors for human consumption . 4.1 The further submission was that only the production and manufacture of industrial alcohol would be governed by the Union List even if the requirement of a declaration under Section 2 of the IDRA read with Item 26 of the First Schedule thereto is as per Entry 52 List I. However, when it comes to Entry 33 List III, there is need for a notified order to claim exclusive jurisdiction on a product of a scheduled industry. If no such order has been issued, the legislative powers of the State would remain exclusive. It was further submitted that alcoholic liquors for human consumption means it is capable of being consumed by humans and it would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not only in the interest of the scheduled industry but also to achieve equitable distribution of the products of such industry and as an economic measure. As a result, in respect of a scheduled industry, the powers of the State under Entries 26 and 27 - List II are denuded. Also, if the field is occupied by the Parliament (Union) and the States are denuded of their powers under Entry 33 List III. Therefore, the judgment in Synthetics and Chemicals (7J) would not call for a reconsideration as it was correctly decided. It was further contended that all liquids containing alcohol would fall under two categories, namely, those meant for human consumption (potable alcohol) and non-potable alcohol. Entry 8 List II deals with only potable alcohol meant for human consumption as a beverage. Thus, non-potable alcohol is outside the scope of Entry 8 List II. The amendment to Item 26 of First Schedule of IDRA has clarified this position. Further, the use of the expression that is to say in Entry 8 List II refers to the various activities concerning potable alcohol and does not refer to any other class of liquor. 4.4 Learned Solicitor General of India submitted that the controversy in this c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reby respectively assigned to them, that is to say xxx (12) goods includes all materials, commodities and articles; xxx (28) taxation includes the imposition of any tax or impost, whether general or local or special and tax shall be construed accordingly; The aforesaid definition of taxation is not exhaustive but inclusive in nature to include not only any tax in the usual understanding of the said expression or tax stricto senso but also any levy akin to a tax. There can be no cavil to the proposition that before any tax or impost could be levied or collected, it must have the authority of law vide Article 265 including legislative competence. 6.1 Article 246 of the Constitution deals with distribution of legislative powers between the Parliament and State Legislature, while Article 254 speaks of inconsistency between the laws made by Parliament and laws made by the Legislatures of States. They read as under: 246. Subject-matter of laws made by Parliament and by the Legislatures of States. (1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List 1 in the Seventh Schedule (in this Constitu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Government of India Act, 1935 which are the precursors to the distribution of legislative powers between the Union and the States under the Seventh Schedule of the Constitution of India. Some of the salient aspects concerning the distribution of the legislative powers between Parliament and State Legislature as per the three Lists in the backdrop of the provisions could be alluded to. 6.3 Article 246 of the Constitution deals with the distribution of legislative powers between the Union and the States. The said Article has to be read along with the three Lists, namely, the Union List, the State List and the Concurrent List. The taxing powers of the Union as well as the States are also demarcated as separate Entries in the Union List as well as the State List i.e. List I and List II respectively. The Entries in the Lists are fields of legislative powers conferred under Article 246 of the Constitution. In other words, the Entries define the areas of legislative competence of the Union and the State Legislature. (vide: State of Karnataka vs. State of Meghalaya, (2023) 4 SCC 416 para 56), ( State of Karnataka ). Interpretation of Legislative Entries : 6.4 On the aspect of interpret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law is, in its pith and substance within the competence of the Legislature which has made it, it will not be invalid because it incidentally touches upon the subject lying within the competence of another Legislature vide FN Balsara. (iii) Once the legislation is found to be with respect to the legislative Entry in question, unless there are other constitutional prohibitions, the power would be unfettered. It would also extend to all ancillary and subsidiary matters which can fairly and reasonably be said to be comprehended in that topic or category of legislation vide United Provinces vs. Atiqa Begum, AIR 1941 FC 16 ( Atiqa Begum ). (iv) Another important aspect while construing the Entries in the respective Lists is that every attempt should be made to harmonise the contents of the Entries so that interpretation of one Entry should not render the entire content of another Entry nugatory vide Calcutta Gas Company. This is especially so when some of the Entries in a different List or in the same List may overlap or may appear to be in direct conflict with each other. In such a situation, a duty is cast on the Court to reconcile the Entries and bring about a harmonious construction. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te. Entries 82 to 92 enumerate the taxes which could be imposed by a law of Parliament. An examination of these two groups of entries shows that while the main subject of legislation figures in the first group, a tax in relation thereto is separately mentioned in the second. Thus, Entry 22 in List I is Railways , and Entry 89 is Terminal taxes on goods or passengers, carried by railway, sea or air; taxes on railway fares and freights . If Entry 22 is to be construed as involving taxes to be imposed, then Entry 89 would be superfluous. Entry 41 mentions Trade and commerce with foreign countries; import and export across customs frontiers . If these expressions are to be interpreted as including duties to be levied in respect of that trade and commerce, then Entry 83 which is Duties of customs including export duties would be wholly redundant. Entries 43 and 44 relate to incorporation, regulation and winding up of corporations. Entry 85 provides separately for corporation tax. Turning to List II, Entries 1 to 44 form one group mentioning the subjects on which the States could legislate. Entries 45 to 63 in that List form another group, and they deal with taxes. Entry 18, for example, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the production, supply and distribution of, (a) the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as such products; (b) foodstuffs, including edible oilseeds and oils; (c) cattle fodder, including oilcakes and other concentrates; (d) raw cotton, whether ginned or unginned, and cotton seed; and (e) raw jute. For a better understanding of the discussion to follow, it would be relevant to refer to the scheme of the IDRA. Scheme of IDRA : 7. The Preamble of the IDRA states that it is an Act to provide for the development and regulation of certain industries. Section 2 declares that it is expedient in the public interest that the Union should take under its control the industries specified in the First Schedule to the said Act. Hence, the question would be, whether, the Parliament by law has declared it expedient in public interest that the Union should take control of certain industries. Section 2 of the IDRA, for immediate reference, reads as under: 2. Declaration as to expediency of control by the Union.- It is hereby declared that it is expedient ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of licence for producing or manufacturing of new articles, conducting investigation to be made into scheduled industries. Chapter IIIA speaks of direct management or control of industrial undertakings by Central Government in certain cases while Chapter IIIAA speaks of management or control of industrial undertakings owned by companies in liquidation. Chapter IIIAB deals with the power to provide relief to certain industrial undertakings while Chapter IIIAC speaks of liquidation or reconstruction of companies. Chapter IIIB deals with control of supply, distribution, price, etc., of certain articles was inserted by Act 26 of 1953. 7.3 Section 18G which is in the said Chapter is relevant for the purpose of this case, reads as under: 18G. Power to control supply, distribution, price, etc., of certain articles. (1) The Central Government, so far as it appears to it to be necessary or expedient for securing the equitable distribution and availability at fair prices or any article or class of articles relatable to any scheduled industry, may, notwithstanding anything contained in any other provisions of this Act, by notified order, provide of regulating the supply and distribution ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price calculated at the market rate prevailing in the locality at the date of sale. (4) No order made in exercise of any power conferred by this section shall be called in question in any court. (5) Where an order purports to have been made and signed by an authority in exercise of any power conferred by this section, a court shall, within the meaning of the Indian Evidence Act, 1872 (1 of 1872), presume that such order was so made by that authority. Explanation. In this section, the expression article or class of articles relatable to any scheduled industry includes any article or class of articles imported into India which is of the same nature or description as the article or class of articles manufactured or produced in the scheduled industry. 7.4 The reason as to why Section 18G was inserted to the IDRA must be noted. In paragraph 3 of the Statement of Objects and Reasons, it has been stated as under: At present, the power to control prices and distribution of various goods under this Act is confined to industrial undertakings registered or licensed under the Act. In all other cases, it is necessary to have recourse to powers Civil Appeal No.151 of 2007 Etc. Page 36 of 241 de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n except for medicinal purposes of intoxicating drinks and of drugs which are injurious to health. What is significant are the words the State shall endeavour to bring about prohibition of the consumption, except for medicinal purposes of intoxicating drinks which are injurious to health . It is on the basis of the said Directive Principle that several prohibition and excise laws have been enacted in several States as a constitutional goal to improve the health of the people of India in the context of prevention and prohibition of consumption of intoxicating liquors . The manufacture, export, import, transport or sale of intoxicating liquors is prohibited except in accordance with a licence, permit or pass granted in that behalf. The State legislations confer power on State Governments in matters concerning liquor licensing and also with regard to imposition of excise duty. 8.1 The following decisions of this Court could be considered at this stage as they are of relevance to the controversy under consideration: a) In Cooverjee B. Bharucha vs. Excise Commissioner and the Chief Commissioner, Ajmer, AIR 1954 SC 220 ( Cooverjee B. Bharucha ), the right of a citizen to carry on trade a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated to import and export of intoxicating liquors . Dealing with the validity of the aforesaid Act, this Court noted the word liquor ordinarily means a strong drink as opposed to soft drink but it must in any event be a beverage which is ordinarily drunk as noted by the Bombay High Court. The High Court further noted that although the State Legislature may prevent the consumption of nonintoxicating beverages and also prevent the use as drinks of alcoholic liquids which are not normally consumed as drinks, it cannot prevent the legitimate use of alcoholic preparations which are not beverages nor the use of medicinal and toilet preparations containing alcohol. This view was challenged before this Court. Noting the several meanings of liquor from the Oxford English Dictionary, it was observed that as a general meaning it is a liquid but as a special meaning it means a drink or beverage produced by fermentation or distillation. It was observed that this is the popular and most widely accepted meaning and the basic idea of beverage prominently ran through the main provisions of the various Acts of this country as well as America and England, relating to intoxicating liquor . Reference w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sell exclusive privileges, there was no basis for contending that the owner of the privileges could not decline to accept the highest bid if it thought that the price offered was inadequate. g) Similarly, in Nashirwar vs. State of Madhya Pradesh, AIR 1975 SC 360 ( Nashirwar ), it was observed that there was no fundamental right of citizens to carry on trade or to do business in liquor. It was observed in the said case as under: There are three principal reasons to hold that there is no fundamental right of citizens to carry on trade or to do business in liquor. First, there is the police power of the State to enforce public morality to prohibit trades in noxious or dangerous goods. Second, there is power of the State to enforce an absolute prohibition of manufacture or sale of intoxicating liquor. Article 47 states that the State shall endeavour to bring about prohibition of the consumption except for medicinal purposes of intoxicating drinks and of drugs which are injurious to health. Third, the history of excise law shows that the State has the exclusive right or privilege of manufacture or sale of liquor. h) In Har Shankar vs. The Deputy Excise and Taxation Commissioner, AIR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasonable limits. It was also observed that the Government can, on its own, trade in its own rights or privileges and can deal with liquor or grant leases of its rights and issue requisite permits or licences or passes on payment of such fees as may be prescribed. Ultimately, it was observed that the amount payable by the licencees on the basis of the bids offered by them in auctions is neither a fee in the technical sense, nor a tax, but is in the nature of the price of a privilege. It was also held that the State has the power to grant liquor licences on payment of such fees as the consideration for parting with the privileges that the State has. That the payment demanded is in the form of excise revenue, which could be in the form of any payment, duty, fee, tax or fine ordered under the provisions of a particular enactment or Rules made thereunder relating to liquor or intoxicating drugs but would not include a fine imposed by a Court of law. That such an imposition could be recovered in the manner authorised by law. Consequently, in Har Shankar, this Court repelled the contention of the retailed vendors of country liquor holding licences for the sale of liquor in specified ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion and also because of the directive principle contained in Article 47, except when it is used and consumed for medicinal purposes. (e) For the same reason, the State can create a monopoly either in itself or in the agency created by it for the manufacture, possession, sale and distribution of the liquor as a beverage and also sell the licences to the citizens for the said purpose by charging fees. This can be done under Article 19(6) or even otherwise. (f) For the same reason, again, the State can impose limitations and restrictions on the trade or business in potable liquor as a beverage which restrictions are in nature different from those imposed on the trade or business in legitimate activities and goods and articles which are res commercium. The restrictions and limitations on the trade or business in potable liquor can again be both under Article 19(6) or otherwise. The restrictions and limitations can extend to the State carrying on the trade or business itself to the exclusion of and elimination of others and/or to preserving to itself the right to sell licences to do trade or business in the same, to others. (g) When the State permits trade or business in the potable li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enting their abuse or diversion for use as or in beverage. (underlining by me) Survey of Judicial Precedents: Synthetics and Chemicals (7J): 9. Since the main controversy in this case turns on the correctness of the decision in Synthetics and Chemicals (7J), it is necessary to advert to the same in some detail. 9.1 In the said case, the main contour of the controversy was whether vend fee in respect of industrial alcohol under different legislations and rules in different States was valid. In this context, the following three questions were considered: (i) whether the power to levy excise duty in case of industrial alcohol was with the State Legislature or the Central Legislature? (ii) what is the scope and ambit of Entry 8 of List II of the Seventh Schedule of the Constitution? (iii) whether, the State Government has exclusive right or privilege of manufacturing, selling, distributing, etc. of alcohols including industrial alcohol. In this connection, the extent, scope and ambit of such right or privilege has also to be examined. 9.1.1 In this background, the expressions intoxicating liquors and alcoholic liquors for human consumption were considered and also Article 47 of the Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... denatured spirit was defined as spirit rendered unfit for human consumption . As per the Rules, licences for possession of denatured spirit including specially denatured spirit for industrial purposes were to be of three kinds (i) Form FL 39; (ii) Form FL 40; and (iii) Form FL 41. 9.1.5 In that background, it was submitted on behalf of the Union of India that the legislative competence of the State enactments in various States will have to be determined with reference to following Entries in List I 7, 52, 59, 84, 96, 97 and Entries in List II - 8, 24, 26, 27, 51, 52, 54, 56, 62 and Entries in List III - 19 and 33. That there is a dichotomy between Entry 84 List I and Entry 51 List II but this would not control the interpretation of other Entries. It was urged that there was no such dichotomy as regards Entry 8 List II as it is not subject to Entry 52 List I as the subject matters of these two Entries are different. That Entry 52 List I deals with industries while Entry 8 List II deals with intoxicating liquors . The power to levy taxes is to be read from the Entry relating to taxes and not from the general Entry. That industry is a topic of legislation left to the Parliament and to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee, shop rent etc. for conferring on a citizen the right to manufacture and sell alcoholic liquors if it is fit for human consumption. This power cannot extend to industrial alcohol or alcohol contained in the medicinal or toilet preparations . According to the Union of India, there was no power to levy such rent or fee with regard to industrial alcohol because (a) industrial alcohol and alcoholic liquors for medicinal and toilet preparations cannot be completely prohibited; (b) as there is a right to carry on business in industrial alcohol , any prohibition on manufacture of industrial alcohol , would be violative of Article 19(1)(g) of the Constitution. Therefore, in the absence of a power to completely prohibit, there will be no power to collect sums for conferring rights to manufacture or sell except the levy of taxes and fees. 9.1.9 On behalf of the State of UP, it was submitted that in order to appreciate the controversy, it was necessary to realise that the real problem arises from the fact that the denaturants can be converted into renaturants through an illicit process. Therefore, they supported the levy. It was submitted that the vend fee on denatured alcohol or denatured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansformed into alcoholic liquors for human consumption and as such, transformation would not entail any process of manufacture as such. There is no organic or fundamental change in this transformation. However, this aspect was not examined, the reason being that the Constitutional provisions specially dealing with the delimitation of powers in a federal polity must be understood in a broad commonsense point of view as understood by common people for whom the Constitution is made. Alcoholic or intoxicating liquors must be understood as these are, not what these are capable of or able to become. Consequently, in paragraph 86 it was concluded as follows: 86. The position with regard to the control of alcohol industry has undergone material and significant change after the amendment of 1956 to the IDR Act. After the amendment, the State is left with only the following powers to legislate in respect of alcohol: (a) It may pass any legislation in the nature of prohibition of potable liquor referable to Entry 6 of List II and regulating powers. (b) It may lay down regulations to ensure that non-potable alcohol is not diverted and misused as a substitute for potable alcohol. (c) The State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entries in the three Lists, it is clear that taxing Entries have been specifically enacted conferring powers of taxation whereas other Entries pertain to the authority of the Legislature to enact laws for purposes of regulation. That the declaration is made by the Parliament and this industry, i.e., industry based on fermentation and alcohol has been declared to be an industry under the IDRA and, therefore, is directly under the control of the Centre, and in respect of regulation the authority of the State Legislature in Entry 8 - List II could only be subject to the IDRA or Rules made thereunder by the Centre. 9.1.18 It was observed that high concentration of ethyl alcohol which is a product of distillation after fermentation is extracted in various concentrations and can also be extracted in a very high concentration above 90 per cent which is generally termed as rectified spirit. It is used as raw material for various industries. It is often supplied after being mixed with methylated alcohol or being denatured by other processes only to safeguard against its use for conversion into alcoholic beverages for human consumption. Ethyl alcohol is diluted by water and its percentage i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de thereunder with respect to prices, licences, permits, distribution, transport, disposal, acquisition, possession, use, consumption, etc., of articles related to a controlled industry, industrial alcohol being one of them. The casual reference to sales tax in the concluding portion of the judgment was accidental and per incuriam was the submission. 9.2.2 While considering the said plea, this Court observed that, the only question which had to be determined between the same parties in Synthetics and Chemicals (7J) was, whether intoxicating liquors in Entry 8 - List II was confined to potable liquor or includes all liquors. Answering this question, this Court categorically held that intoxicating liquors within the meaning of Entry 8 - List II was confined to potable liquor and did not include industrial liquor . 9.2.3 Therefore, the only question that was considered by the seven-Judge Bench of this Court was whether the State could levy excise duty or vend fee or transport fee and the like by recourse to Entry 51 or 8 - List II in respect of industrial alcohol . This Court by a detailed discussion in the seven-Judge Bench decision had observed that the impugned statutory provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diverted and misused as substitute for potable alcohol. In paragraph 88 of the decision it was observed that in respect of industrial alcohol the States, were not authorised to impose the impost as they have purported to do in that case but that did not effect any imposition of fee where there were circumstance, to establish that there was quid pro quo for the fee nor it will affect any regulatory measure. 9.4 It was further observed that the principle of occupied field precluded States from trenching on any power which was already covered by a Central legislation. But in absence of any provision in IDRA touching upon regulation or ensuring that industrial alcohol was not diverted the State was competent to legislate on it under Entry 33 List III. Gujchem Distillers: 9.5 In Gujchem Distillers India Ltd. vs. State of Gujarat, (1992) 2 SCC 399 ( Gujchem Distillers ), the judgment in Synthetics and Chemicals (7J) was followed and the fee of 7 paise per litre was held to be a regulatory measure, namely, for denaturation of spirit and supervision of the said process. Civil Appeal No.151 of 2007 Etc. Page 71 of 241 Modi Distillery: 9.6 In State of UP vs. Modi Distillery, (1995) 5 SCC 753 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o whisky and the ethyl alcohol content thereof varied between 19 to about 43 per cent, according to the ISI specifications. In other words, ethyl alcohol (95 per cent) was not an alcoholic liquor for human consumption but could be used as a raw material or input, after processing and substantial dilution, in the production of whisky, gin, country liquor, etc. In the light of experience and development, it was necessary to state that intoxicating liquor meant only that liquor which was consumable by human beings as it was. 10. What the State seeks to levy excise duty upon in the Group B cases is the wastage of liquor after distillation, but before dilution; and, in the Group D cases, the pipeline loss of liquor during the process of manufacture, before dilution. It is clear, therefore, that what the State seeks to levy excise duty upon is not alcoholic liquor for human consumption but the raw material or input still in process of being rendered fit for consumption by human beings. The State is not empowered to levy excise duty on the raw material or input that is in the process of being made into alcoholic liquor for human consumption. 11. That the measure of excise duty upon alcoho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating effect on the health of consumers and may even result in fatal consequences or loss of vision and other pernicious physical handicaps. Therefore, supervision was provided at the cost of distilleries and the licencees of the distilleries will have to bear the cost of maintenance of such supervision. The same would squarely fall within the regulatory powers for framing Rules with a view to see that the provisions of the aforesaid Act are not stifled or tinkered with by such licencee distilleries. 9.7.2 It was observed that the expression commercial would fall in the same category as denatured spirit, meaning thereby those spirits which are not fit for human consumption. They would not cover potable spirits even assuming that they are commercial spirits. That, the expression other commercial spirits as contemplated by the Rule are those spirits which are unfit for human consumption and they do not cover potable liquor which cannot fall in line with denatured spirit. Thus, it was observed that the expression or any other commercial spirit must mean those spirits which fall in the category of spirits unfit for human consumption like denatured spirits which are used for industrial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere issued to all the State Governments as well as Union of India and the interplay between the Entries of Lists I, II and III which are under consideration here and which are extracted above, were discussed. 9.8.2 It was opined that Entry 51 - List II and Entry 84 - List I complement each other inasmuch as both provide for duties of excise. However, Entry 51 - List II empowers the State to levy duties of excise on alcoholic liquors for human consumption, which is expressly excluded from Entry 84 - List I. Therefore, alcoholic liquors may be used for several purposes, one of which is meant for human consumption. It was further observed that Entry 8 List II does not use the expression alcoholic liquors for human consumption but employs the expression intoxicating liquors and significantly, the words for human consumption is conspicuous by its absence. According to Jeevan Reddy, J., this is for the obvious reason that the very word intoxicating signifies for human consumption . Thus, Entry 8 - List II emphasizes all aspects of intoxicating liquors within the State's sphere, i.e., to say production, manufacture, possession, transport, purchase and sale of intoxicating liquors . In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, transport, purchase and sale are within the exclusive domain of the States and the Union of India has no say in the matter. 9.8.6 In this case, the Court further noted the contentions urged on behalf of the State to the effect that rectified spirit is intoxicating liquors within the meaning of Entry 8 - List II and hence outside the purview of Entry 24 - List II, which would in turn mean that the Union cannot take over its control by making a declaration in terms of Entry 52 - List I. Further Item 26 of the Schedule to the IDRA is ineffective and invalid insofar as it seeks to regulate the production and manufacture, etc. of rectified spirit. The State submitted that the decision to the contrary in Synthetics and Chemicals (7J) is not correct and requires reconsideration. 9.8.7. The State next contended that Entry 51 - List II and Entry 84 - List I speak of alcoholic liquors for human consumption and not alcoholic liquors fit for human consumption . That the judgment in Synthetics and Chemicals (7J), read the word fit in the Entries and thus curtailed the legislative power of the States. It was further contended that rectified spirit is really and essentially intoxicating liquo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ean that it cannot be utilised for potable purposes either by diluting it or by blending it with other items. The Court in Bihar Distillery noted that the undeniable fact is, that rectified spirit is both industrial alcohol as well as a liquor which can be converted into country liquor just by adding water. It is also the basic substance from which IMFL are made. Denatured rectified spirit, of course, is wholly and exclusively industrial alcohol . It was observed that this basic factual premise which was not and could not be denied by any one raised certain aspects for consideration therein which were not raised or considered in Synthetics and Chemicals (7J). 9.8.10 It was noted that Synthetics and Chemicals (7J) did not deal with rectified spirit which could be converted into potable alcohol and was merely concerned with industrial alcohol which could not be so converted, i.e., denatured rectified spirit. A distinction was drawn between industries engaged in manufacturing rectified spirit meant exclusively for supply to industries (industries other than those engaged in obtaining or manufacturing of potable liquor), whether after denaturing it or without denaturing it, and industr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g it for potable purposes, which are as under: (1) (a) So far as industries engaged in manufacturing rectified spirit meant exclusively for supply to industries (industries other than those engaged in obtaining or manufacture of potable liquors), whether after denaturing it or without denaturing it, are concerned, they shall be under the total and exclusive control of the Union and be governed by the IDR Act and the rules and regulations made thereunder. In other words, where the entire rectified spirit is supplied for such industrial purposes, or to the extent it is so supplied, as the case may be, the levy of excise duties and all other control including establishment of distillery shall be that of the Union. (b) The power of the States in the case of such an industry is only to see and ensure that rectified spirit, whether in the course of its manufacture or after its manufacture, is not diverted or misused for potable purposes. They can make necessary regulations requiring the industry to submit periodical statements of raw material and the finished product (rectified spirit) and are entitled to verify their correctness. For this purpose, the States will also be entitled to pos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes, i.e., for obtaining or manufacturing potable liquors shall be supplied to and/or utilised, as the case may be, in accordance with the State excise enactment concerned and the rules and regulations made thereunder. If the State is so advised, it is equally competent to prohibit the use, diversion or supply of rectified spirit for potable purposes. (4) It is advisable and necessary that the Union Government makes necessary rules/regulations under the IDR Act directing that no rectified spirit shall be supplied to industries except after denaturing it save those few industries (other than those industries which are engaged in obtaining or manufacturing potable liquors) where denatured spirit cannot be used for manufacturing purposes. (5) So far as rectified spirit meant for being supplied to or utilised for potable purposes is concerned, it shall be under the exclusive control of the States from the moment it is cleared/removed for that purpose from the distillery apart from other powers referred to above. (6) The power to permit the establishment of any industry engaged in the manufacture of potable liquors including IMFLs, beer, country liquor and other intoxicating drink ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not and cannot, deal with manufacture, production of intoxicating liquors. All the petitioners before us are engaged in the manufacture of intoxicating liquors. The State Legislature is, therefore, perfectly competent to make a law prohibiting their manufacture and production in addition to their sale, consumption, possession and transport with reference to Entries 8 and 6 in List-II of the Seventh Schedule to the Constitution read with Article 47 thereof. The Civil Appeals were dismissed by this Court. Vam Organic I : 9.10 In Vam Organic I, the Notification dated 18.05.1990 issued by the Excise Commissioner, Uttar Pradesh, was assailed before the High Court and the writ petition was dismissed. By the said Notification, certain amendments were made to the Rules published vide Notification dated 26.09.1910. Section 41 of the UP Excise Act, 1910 gave power to the Excise Commissioner to make Rules, inter alia, for regulating the manufacture, supply, storage or sale of any intoxicant. The earlier Rule 2 was substituted by a new Rule 2 titled Denaturation of Spirit . The amended Rule provided for a new licence for denaturation of spirit in a prescribed form to be issued by the Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on is a statutory duty imposed by a notification under the U.P. Excise Act and as no service by the State was being provided for the same, no fee could be charged and even if the State had to incur any expenses for enforcement of the requirement of denaturation, there is no quid pro quo between the expenses incurred and the fees charged. This Court noted that the term industrial alcohol is not used in any of the Lists and whether alcoholic liquors other than alcoholic liquors for human consumption or intoxicating liquors was a State subject or a Union subject should be the real controversy. It was with a view to describing that particular kind of liquor the term industrial alcohol is used. It was observed that after an analysis of all the provisions of law giving the Union Parliament and the State Legislature jurisdiction to legislate on alcohol, this Court in Synthetics and Chemicals (7J) held that the impugned notifications therein, imposing certain fees as vend fee or transport fee, etc. were within the legislative competence of the State. That this Court was fully aware of the fact that rectified spirit was the ingredient for intoxicating liquors or alcoholic liquors for human ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilised for the manufacture of beer and then allowance for wastage of seven per cent had to be made and thereafter the quantity of beer manufactured was determined. That the figure taken for the purpose of calculating the excise duty was only on the end product, namely the beer produced, and not the quantity of the raw material used in manufacture of beer, during which loss of some quantity as wastage would have occurred and there could not be a deduction of any sum or proportion as wastage from the quantity of end product in order to arrive at that quantity. In such a case, the question of determining any allowance of seven per cent for wastage did not arise. Therefore, the Excise Authorities could levy excise duty only on the beer after it had been manufactured and the levy was on the quantity manufactured. How this quantity had to be arrived was to be determined according to Section 32 read with Rule 35 of the aforementioned Act and Rules. Hence, Rule 35 was sustained as valid and it did not require any reading down. Industrial Corporation (P) Ltd.: 9.12 In the State of Bihar vs. Industrial Corporation (P) Ltd., (2003) 11 SCC 465 ( Industrial Corporation (P) Ltd. ), the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assailed before the Allahabad High Court. The writ petitions were allowed, and the State had filed appeals before this Court. Section 3 (13) of the UP Excise Act, 1910 (for short, 1910 Act ) had defined the word intoxicant as meaning any liquor or intoxicating drug . The word liquor in turn was defined in Section 3(11) as meaning intoxicating liquors and includes spirits of wine, spirit, wine, tari, pachwai, beer and all liquid consisting of or containing alcohol, also any substance which the State Government may by notification declare to be liquor for the purposes of the Act. In paragraph 6 of the judgment, it was observed that industrial alcohol is not liquor nor is it potable as such. However, it may be utilized to produce a kind of liquor if it is denatured. Denatured in Section 3(9) of the Act was defined to mean rendered unfit for human consumption in such manner as may be prescribed by the State Government by notification in this behalf . Thus, the State Act equated industrial alcohol to nonpotable alcohol and not fit for human consumption. To ensure the denaturation of industrial alcohol under Section 41 of the 1910 Act, Rules were made in the year 1976. It was contended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Even according to the demarcation of the fields of legislative competence as envisaged in Bihar Distillery industrial alcohol for industrial purposes falls within the exclusive control of the Union and according to Bihar Distillery denatured rectified spirit, of course, is wholly and exclusively industrial alcohol (SCC p. 742, para 23). Analysis of Judicial Dicta: 10. I shall now analyse the judgments of this Court on the points in controversy. 10.1 In Indian Mica, the question which came up was whether the fee levied under Rule 111 of the Bihar and Orissa Excise Rules framed under Section 90 of the Bihar and Orissa Excise Act, 1915 on denatured spirit used and possessed by the appellants therein had sufficient quid pro quo for the levy. This Court struck down the levy as being unjustified and excessive as there was no co-relationship between the levy and the services rendered. 10.2 In Southern Pharmaceuticals and Chemicals vs. State of Kerala, AIR 1981 SC 1863 ( Southern Pharmaceuticals ), being aggrieved by the dismissal of their writ petitions and upholding the constitutional validity of Section 12-A and other sections of the Kerala Abkari Act, and Rules 13 and 16 of the Keral ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 List I meant that liquor which is consumed by human beings directly as a beverage or as a drink. It was observed that alcoholic liquor or intoxicating liquors must be understood as common people would understand it and not what certain alcoholic products are capable of being transformed or converted into. That when excise duty was being levied under Entry 84 - List I, it did not include alcoholic liquors for human consumption but included denatured spirit which is industrial alcohol . It was observed that merely because the denatured spirit could be treated with water and transformed into alcoholic liquors into human consumption which did not involve a process of manufacture, the States would not have the legislative competence to levy excise duty under Entry 51 - List II. 10.4 Subsequently, in Synthetics and Chemicals (2J), it was clarified that the question which arose for consideration before the seven-Judge Bench was with regard to the validity of vend fee and other fees charged by the States. The two-Judge Bench clarified that the seven-Judge Bench had answered the question whether, intoxicating liquors in Entry 8 - List II was confined to only potable liquor or other liquor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cohol was excluded. However, under Entry 33 - List III, there was power vested in the State insofar as industrial alcohol was concerned as the said product was a product of a scheduled industry, namely, Item 26 of the First Schedule of the IDRA which was enacted pursuant to Entry 52 - List I. This is subject to the intention of the Parliament to occupy the field as per the provisions of the IDRA, in particular, under Section 18G of the said Act. Gujchem Distillers also followed the aforesaid judgment. Khoday Distilleries also emphasised the fact that the State has the power to completely prohibit the manufacture, sale, possession, distribution and consumption of potable liquor as a beverage but the State cannot prohibit trade and business in medicinal and toilet preparations containing liquor or alcohol. In the same way, the State cannot prohibit trade or business in industrial alcohol which is not used as a beverage but used legitimately for industrial purposes. It was held that restrictions imposed by the States on trade or business in industrial alcohol or in medicinal and toilet preparations containing liquor or alcohol could be for the purpose of preventing their abuse or dive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court further observed that the States have the power to legislate under Entry 33(a) List III provided the field is not occupied by the Union. That there was a clear line of demarcation at the stage of removal or clearance of the product, i.e., if the clearance is for industrial purpose, the duties of excise and all other control is with the Union but if the removal or clearance is for obtaining or manufacturing potable liquor , the levy of duty and other control is with the State. It was observed that there was a need for joint control and supervision of the process of manufacture of rectified liquor and its use and disposal for ensuring that industrial alcohol was not misused by diverting it for potable purpose and consequently certain concrete observations were made in the said judgment which is of a binding nature. 10.10 The challenge to the notification issued by the excise commissioner, Uttar Pradesh dated 18.05.1990 was a subject matter of controversy in Vam Organic I, in the context of legislative competence of the State of Uttar Pradesh to impose tax or levy on industrial alcohol , ethyl alcohol and rectified spirit. It was observed that the expression industrial alc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 of Synthetics and Chemicals (7J) the expression both potable and is an inadvertent insertion inasmuch as there was no reason to state that licences to manufacture potable alcohol was vested in the Central Government. Therefore, to that extent the judgment in Synthetics and Chemicals (7J) calls for a clarification. Apart from that the following points would emerge from paragraph 85 : (i) That, on insertion of Item 26 of the First Schedule to IDRA, the control of Fermentation Industries has vested exclusively in the Union. (ii) Therefore, even the States cannot themselves manufacture industrial alcohol without the permission of the Central Government. (iii) Industrial alcohol cannot be amenable to States claim to possession of exclusive privilege and the States can neither rely on Entry 8 List II nor Entry 33 List III as a basis for such claim. (iv) The States cannot claim that under Entry 33 List III, it can regulate industrial alcohol as a product of the scheduled industry as the Union under Section 18G of the IDRA has evinced a clear intention to occupy the whole field. The doctrine of occupied field under Article 254 has been applied in the said case which shall be adverted to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etics and Chemicals (7J), was also clear about the controversy before it, namely, the competence of the Uttar Pradesh State Legislature to impose vend-fee on industrial alcohol when the same is a product of Fermentation Industries and, therefore, under the control of the Union. 11.4 However, the sum and substance of the controversy has to be answered by this Court on the premise that, despite there being clarity in the minds of the authorities under the States as well as the Centre, repeated imposition of imposts in the form of tax or excise duties etc., have brought several cases before this Court for adjudication. Ultimately, those who are in the business of industrial alcohol or intoxicating liquors , namely, nonpotable and potable liquor respectively are clear about the nature of their business and the products that they are dealing with. Hence, I feel that it is incumbent for this Court to enhance the clarity and not create a further legal regime which would cause confusion and legal uncertainty in the economy. Meaning of intoxicating liquors : 12. Before embarking on an enquiry in this Reference to understand the scope of the expression intoxicating liquors as it appears in E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the phrase and its legislative history, but found that no conclusive answer can be reached on the legal import of intoxicating liquors . With due respect, I view that such an enquiry needs to give due primacy to the ordinary and natural meaning of words and also test their connotations in colloquial use by the Constitution makers so as to give it a constitutional flavour. A Historical Perspective: 12.4 A historical enquiry would show that intoxicating liquors was first used in Entry 31 List II in the Government of India Act, 1935. This was a departure from the legislative head in Devolution Rules framed under the Government of India Act, 1919 insofar as the Entry therein was alcoholic liquor . The revisions in List II of Government of India Act, 1935 were partly the product of a Joint Select Committee chaired by Lord Linlithgow. Later, the word liquors was also qualified by the word intoxicating . 12.5 I may briefly refer to the following remarks of Brewer, J. in South Carolina vs. United States, (1905) 199 US 437 ( South Carolina ): To determine the extent of the grants of power, we must, therefore, place ourselves in the position of the men who framed and adopted the Constitutio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he use of the expression intoxicating liquors in Constituent Assembly Debates in the context of Article 47. Sri B.G. Kher speaking on the ruin caused by the consumption of alcohol noted the use of intoxicating liquors and drugs as a vice. 12.9 The aforesaid discussion points to the fact that there was a consumption-oriented meaning attached to intoxicating liquors that was used for legal and administrative purposes. To ascertain the breadth of the phrase intoxicating liquors as it was used by the draftsmen of the Constitution and the Government of India Act, 1935 one cannot be bound by only the definitions provided in legislative enactments, or lack thereof. 12.10 The Constitution of India clearly employs three distinct expressions relevant to the present controversy: (a) Entry 51 - List II refers to duties on alcoholic liquors for human consumption ; (b) Article 47 uses the words consumption of intoxicating drinks ; and (c) Entry 8 List II uses the words in question intoxicating liquors 12.11 I may observe that the expression alcoholic liquors for human consumption as it appears in Entry 51 List II and intoxicating drinks as it appears in Article 47 have been categorically used in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gislative competence of States on any liquors potentially coming within the scope of Entry 8 List II. In the absence of an intoxicating effect from liquors, a State Legislature cannot legislate on the subject. However, in my view, what is required to be seen is the nature of the product which leads to such an intoxicating effect upon human consumption of the same. Here, the expression consumption must be explained. It is not all kinds of human consumption, direct or indirect, which is the determining factor. It is only direct consumption i.e. as an ingestion by the act of drinking as a beverage or a drink. An indirect consumption by use of alcoholic liquors as a raw material for any other product, industrial, medicinal or a toilet item cannot be included as part of Entry 8 List II. Secondly, merely because there can be a potential misuse of industrial alcohol , for example, by converting rectified spirit ( industrial alcohol ) as a beverage which has an intoxicating effect, Entry 8 List II cannot be stretched to include such industrial alcohol . The prevention of abuse of industrial alcohol as a beverage is also covered under Entry 8 List II. Thus, what is carved out of Fermentatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Spirits is defined to mean spirits of any description and includes all liquors mixed with spirits and all mixtures, compounds and preparations made with spirits, but does not include methylated spirits : Customs and Excise Act, 1952. (ii) Wine means liquor obtained from the alcoholic fermentation of fresh grapes or the must of fresh grapes, whether or not it is fortified with spirits or flavoured with aromatic extracts. (iii) Made-wine means any liquor obtained from the alcoholic fermentation of any substance or by mixing a liquor so obtained or derived from a liquor so obtained with any other liquor or substance, but does not include wine, beer, black beer, spirits or cider. This definition replaced an earlier one in different terms of British wine . (iv) The definition of beer includes ale, porter, stout and any other description of beer and any other liquor which is made or sold as a description of beer or as a substitute for beer which on analysis of a sample at any time is found to be of a strength exceeding two degrees of proof, but does not include liquor made elsewhere than upon the licenced premises of a brewer for sale which on analysis of a sample at any time is found t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her Entry in List II that used an adjective as a qualifier. Whether use of the word intoxicating enlarges or limits the scope of liquors is something that needs to be answered. Herein, intoxicating is an adjective that is adjoined to liquors and explains an effect that is caused. In this regard, learned Solicitor General contended that intoxicating has been used to expand beyond the limits of alcoholic liquors because States have an interest in regulating other intoxicating liquors such as bhang. It needs no labour that an intoxicating effect can be said to be caused only upon actual consumption by human beings. Unlike potable alcohol, industrial alcohol by its design, intent and purpose is neither sought to be consumed and cause an intoxicating effect nor is it produced keeping in mind its intoxicating effect on human beings. If we were to read industrial alcohol as intoxicating liquors which even though by design is neither supposed to be consumed nor have an effect on health but has the constituents that could be intoxicating when misused, it would enable a cumbersome interpretational plane. 12.21 It is useful to allude to the sine qua non of Entry 8 List II i.e. the intoxicatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is different from saying that States have the right to regulate industrial alcohol or non-potable alcohol. A power to legislate as to the principal matter specifically mentioned in the Entry also includes within its expanse, legislation touching incidental and ancillary matters. However, ancillary matters by a backdoor cannot be included within the Entry, beyond what is covered as the principal. Herein, the ancillary matter being prevention of mischievous use of industrial alcohol would be within Entry 8 List II but industrial alcohol as such would not be included. Hence, the analysis of the relevant Entries in the three Lists must be in the backdrop of the aforesaid discussion. Analysis of relevant Entries in the three Lists: 13. While analysing Entry 52 List I which deals with industries, the control of which by the Union is declared by Parliament by law to be expedient in public interest, it would be useful to refer to Entries 7 and 54 List I. What is common in all these three Entries is that there is a declaration made by the Parliament. Entries 7, 52 and 54 List I read as under: 7. Industries declared by Parliament by law to be necessary for the purpose of defence or for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nging the constitutional validity of the Ordinance as well as the Act on various grounds. The Division Bench of the High Court had repelled the contentions advanced on behalf of the petitioners therein and upheld the constitutional validity of the Act. Before this Court, the main thrust of the attack was that the U.P. Legislature lacked legislative competence to enact the impugned Act. This was because under Entry 52 List I the Parliament had made the requisite declaration in Section 2 of the IDRA and in view of Item 25 of the First Schedule to the Act i.e. sugar, being a declared industry therein, that industry was excluded from Entry 24 - List II. Hence U.P. State Legislature was denuded of all legislative power to legislate in respect of sugar industry and the impugned legislation was void on account of legislative incompetence. 13.2.1 D.A. Desai, J. for himself and on behalf of V.R. Krishna Iyer and S. Murtaza Fazal Ali, JJ. wrote for the majority. This Court analysed the relevant Entries keeping in view the legislative perspective and historical background through which Entries 7 and 52 List I, Entry 24 - List II and Entry 33 - List III, inter alia, had passed through. Conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein provided in Section 2 of the IDRA would not lead to the conclusion that the control assumed was to be something in abstract, total and unfettered and not as per the provisions of the IDRA. It was thus held that to the extent Union acquired control by virtue of declaration in Section 2 of the IDRA as amended from time to time, the power of the State Legislature under Entry 24 - List II to enact any legislation in respect of declared industry so as to encroach upon the field of control occupied by IDRA would be taken away. 13.2.2 In this regard, reliance was placed on Baijnath Kedia vs. State of Bihar, AIR 1970 SC 1436 ( Baijnath Kedia ). Thus to the extent the provision of the IDRA occupies the field, the State Legislature stands denuded of its power to legislate in respect of such declared industry. Examining the provision of the IDRA, it was held that in pith and substance, the impugned Act was one for acquisition of scheduled undertakings to the corporation, which would in no way come in conflict with any of the provision of the IDRA or would not trench upon any control exercise by the Union under the various provisions of the IDRA. That the IDRA is not concerned with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vs. Chanan Mal, AIR 1976 SC 1654 ( Chanan Mal ), would not be of assistance in this behalf. In each of those cases, the declaration made by Parliament in the concerned enactment limited the control of the regulation of the mines and the development of minerals to the extent provided in the enactment. Whether the terms in which the declaration has been made in Section 2 of the IDRA, a declaration not expressly limiting control of the specific industries to the extent provided by the Act, can be construed as being so limited was a matter which, they thought, should be dealt with in some more appropriate case. That the range of considerations encompassed within the field of enquiry to which the point was amenable had not been sufficiently covered before the Court. This was for the good reason and, hence, the provocation was limited. Therefore, the controversy could be adequately answered on the ground that the legislation impugned therein fell within Entry 42 - List III and would not be related to Entry 52 - List I or Entry 24 - List II. 13.2.4 Therefore, there was a reluctance to enter upon an examination of the mutually competing claims of Entry 52 - List I and Entry 24 - List II E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am ), while referring to Modern Dental College Research Centre vs. State of Madhya Pradesh, (2016) 7 SCC 353 ( Modern Dental College ), explained that where one Entry is made subject to another Entry, it means that out of the scope of the former Entry a field of legislation covered by the latter Entry has been reserved to be specially dealt with by the appropriate Legislature. c) Similarly, while interpreting the significance of a constitutional provision being subject to another in The South India Corporation (P) Ltd. vs. The Secretary, Board of Revenue Trivandrum, AIR 1964 SC 207 ( South India Corporation ), this Court observed that the expression subject to conveys the idea of a provision yielding place to another provision or other provisions to which it is made subject. d) Helpful reference may also be made to the import of subject to in legislative uses. In Ashok Leyland Ltd. vs. State of Tamil Nadu, (2004) 3 SCC 1, ( Ashok Leyland Ltd. ) this Court held that subject to is an expression whereby a limitation is expressed. 13.4 Having noted as above, it is also crucial to examine the interplay between Entry 52 List I, Entry 24 List II and Entry 8 List II. Entry 24 List I is a r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpretation between Entries 24 and 25 List II in relation to Entry 52 List I was considered. It was observed that Entry 24 List II in its widest amplitude takes in all industries, including that of gas and gas-works . So does Entry 25 List II which comprehends gas industry. There is, therefore, an apparent conflict between the two Entries and they overlap with each other. It was observed that in such a contingency the doctrine of harmonious construction must be invoked. While Entry 24 List II covers a very wide field, that is, the field of entire industry being within the legislative competence of the State, Entry 25 List II dealing with gas and gas-works , can be confined to a specific industry, that is, the gas industry . This was possibly because only one or two States are concerned with gas industry and it was not considered to be of an all-India importance and therefore, was carved out of Entry 24 List II and given a separate Entry as Entry 25 List II, as otherwise if a declaration by law was made by Parliament within the meaning of Entry 7 or Entry 52 - List I, gas and gas industries would be taken out of the legislative power of States. Therefore, by the doctrine of harmon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufactured or produced elsewhere in India, namely, - (a) alcoholic liquors for human consumption; (b) opium, Indian hemp and other narcotic drugs and narcotics, but not including medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this Entry. Both are taxation entries. 13.6 On a comparative reading of the said two Entries, what is evident is that excise duty on goods manufactured as per Entry 84 List I excludes duty of excise on alcoholic liquors for human consumption. This is subject to the further exception that, if, any medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of the said Entry, namely, opium, Indian hemp and other narcotic drugs and narcotics, then, the excise duty is leviable as per Entry 84 List I by the Union or Central Government. Conversely, under Entry 51 List II, goods manufactured or produced in the State would be subject to excise duty such as on a) alcoholic liquors for human consumption; b) opium, Indian hemp and other narcotic drugs and narcotics, but does not include medicinal and toilet preparations containing alcohol or any substance included in sub-para ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to manufacture industrial alcohol and subject it to a process and sell it as alcoholic liquors for human consumption. The same is prohibited and has to be dealt with having regard to the scope and ambit of Entry 8 List II. On the other hand, it is only intoxicating liquors which is directly for human consumption as a beverage and the production, manufacture, possession, transport, purchase and sale of such intoxicating liquors , as per Entry 8 List II, which is within the competence of State Legislature i.e. for the purpose of regulation of such intoxicating liquors which would also entail levy of an excise duty on such intoxicating liquors as per Entry 51 List II as alcoholic liquor for human consumption. Therefore, on intoxicating liquors which is alcoholic liquors directly for human consumption as a beverage, excise duty is levied by the State Legislature and regulated under Entry 8 List II. Also, under Entry 84 List I, the Parliament has no power to levy any such excise duty on such intoxicating liquors meant for human consumption as a beverage as it is an expressly excluded item. In other words, alcoholic liquors for human consumption is thus directly relatable to intoxicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the control of such industry by the Union has been declared by Parliament by law to be expedient in public interest are manufactured in India or imported into India, then as per Entry 33(a) List III, on the production, supply and distribution of and trade and commerce of such industrial products, the State Legislature would not have any exclusive power to pass a law under Entries 26 and 27 List II as they are subject to Entry 33(a) List III. In other words, in view of the passing of the IDRA, under Entry 52 List I and the inclusion of, inter alia, products of Fermentation Industries such as industrial alcohol in Item 26 of the First Schedule of the IDRA, the State Legislatures would be subject to the powers of the Parliament to pass a law in the matter of production, supply, distribution, trade and commerce of such industrial product. 13.11 Therefore, if the control of any industry has been declared by Parliament by law to be expedient in the public interest, then in such a case, in the matter of production, supply and distribution of products of such industry, Entry 27 List II would be subject to Entry 33(a) List III. Thus, the subject production, supply and distribution of good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Parliament as well as the State Legislature have the competence to pass such laws. Then, the question that would arise, is whether, there would be repugnancy between the laws made by Parliament and laws made by a State Legislature and if so, how could it be resolved. 14.1 In this regard, Section 18G which is a part of Chapter IIIB of the IDRA could be considered. The said Section states that the Central Government, so far as it appears to be necessary or expedient for securing the equitable distribution and availability at fair prices of any article or class of articles relatable to any scheduled industry, i.e. any of the industries specified in the First Schedule of IDRA may, notwithstanding anything contained in any other provision of the IDRA by notified order, provide for regulating the supply and distribution thereof and trade and commerce therein. This provision deals particularly with regard to regulation of supply and distribution, trade and commerce of any article relatable to scheduled industry. Sub-section (2) of Section 18G states that without prejudice to the generality of the powers conferred by sub-section (1) of Section 18G, a notified order made may provide for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of notified orders on certain articles related to scheduled industries. The field of legislation must therefore be left open for the Central Government to act by issuance of a notified order as and when thought necessary or expedient to secure and achieve the objects stated in the said provision. 14.5 But, can it be held that in the absence of any such notified order issued by the Central Government, the States could pass laws under Entry 33(a) - List III? Would it lead to a legal confusion and an overlapping and contradiction? This is because if it is held that in the absence of there being a notified order actually issued by the Central Government under Section 18G of the IDRA, the States are empowered to pass laws under Entry 33(a) - List III and such laws are in fact made under the aforesaid Entries by the States and the Central Government subsequently decides to issue a notified order under Section 18G of the IDRA, the question would be, what would be the fate of the laws made by the States if they overlap with the notified order issued under Section 18G of the IDRA? Obviously, the control of any industry being taken over by the Union under the provisions of the IDRA would i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect to one of the matters enumerated in the Concurrent List, then, subject to clause (2) thereof, the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void. Under Article 13(3)(a), law includes any ordinance, order, bye-law, rule, regulation, notification, custom or usage having in the territory of India the force of law. 14.8 Clause (2) of Article 254 is an exception to clause (1). It states that where a law made by the Legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State. The proviso states that nothing in clause (2) of Article 254 would prevent Parliament from enacting at any time any law with respect to the same matter including a la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, in my view, the doctrine of parliamentary supremacy is writ large in Articles 246 and 254 both in the manner of arrangement of the subjects in the three Lists as well as the extent to which the State Legislatures have competence with regard to the subjects assigned to them particularly in List III or the Concurrent List. 15.2 In this case, we have to consider Entry 33(a) List III in light of Entry 52 - List I and the observations made by this Court in Synthetics and Chemicals (7J). Entry 33(a) List III is in the Concurrent List and it speaks of trade and commerce in, and production, supply and distribution of the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as such products. A dissection of this Entry would indicate that insofar as products of any industry which is a scheduled industry in terms of a law made by Parliament by virtue of Entry 52 List I viz. where the control of such scheduled industry has been assumed by the Union (insofar as trade and commerce in, and production, supply and distribution of the products of such industry), bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion the products of any scheduled industry comes within the scope and ambit of the expression article or class of articles relatable to any scheduled industry. Thus, Section 18G which pertains to a scheduled industry is also relatable to Entry 33(a) List III though it is a part of IDRA which is a Parliamentary law enacted on the basis of Entry 52 List I. 15.5 The question that would then arise is, whether, by the mere insertion of Section 18G to the IDRA with effect from 01.10.1953, the State Legislatures have been denuded of their legislative competence in the matter of regulation of supply and distribution and trade and commerce of products of any scheduled industry. The conundrum which has arisen in this case is on account of the observation in paragraph 85 of Synthetics and Chemicals (7J), which, inter alia, reads as under: 85. The State cannot claim that under Entry 33 of List III, it can regulate industrial alcohol as a product of the scheduled industry, because the Union, under Section 18-G of the IDR Act, has evinced clear intention to occupy the whole field. The aforesaid observations mean that by the very insertion of Section 18G to the IDRA, there is a denudation of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther products of fermentation industries. The said Item 26 was added w.e.f. 08.05.1952 even prior to the insertion of Section 18G to the IDRA which is w.e.f. 01.10.1953. However, w.e.f. 14.05.2016, Item 26 has been amended to clarify that Fermentation Industries refers to industries others than potable alcohol. This is for the reason that intoxicating liquors in Entry 8 List II is equated to only potable alcohol and rest of the industry of the Fermentation Industries other than potable alcohol is a scheduled industry. 15.8 Once an industry is a scheduled industry under the provisions of IDRA, in the context of Section 18G the Central Government may notwithstanding anything contained in any other provision of IDRA by a notified order provide for regulating the supply and distribution thereof and trade and commerce therein of a product of scheduled industry. A notified order may also provide - (a) for the purpose of controlling the prices at which any such article or class of articles may be bought or sold for; (b) for regulating the licences, permits or otherwise the distribution, transport, disposal, acquisition, possession, use or consumption of any such article or class thereof; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntended to be a complete exhaustive Code; and (iii) Even in the absence of intention, a conflict may arise when both State and commonwealth seek to exercise their powers over the same subject matter. 16.1 In Tika Ramji, this Court accepted the above three rules evolved by Nicholas, among others, as a useful guide to test the question of repugnancy. The same was also quoted by this Court in M/s. Hoechst Pharmaceuticals Ltd. vs. State of Bihar, AIR 1983 SC 1019 ( Hoechst Pharmaceuticals Ltd. ). In the said case, it was observed that the question of repugnancy between a law made by Parliament and a law made by the State Legislature arises only in case both the legislations occupy the same field with respect to one of the matters enumerated in the Concurrent List and there is direct conflict between the two laws. It is only when both these requirements are fulfilled that the State law will, to the extent of repugnancy, become void. Article 254(1) has no application to cases of repugnancy due to overlapping found between List II on the one hand and Lists I and III on the other. If such overlapping exists in any particular case, the State law would be ultra vires because of non-obstante ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not reconcilable then, the principle of Parliamentary supremacy would apply in the context of repugnancy. 16.3 The next question that would arise is, whether, the principle of repugnancy in Article 254 of the Constitution could have a wider ramification inasmuch as even in the absence of there being two sets of laws which have been made by the Parliament and by the State Legislature but owing to the nature of the law that the Parliament has made, the State Legislature is incompetent in making a law on the same subject. In other words, whether a law enacted by the Parliament can prevent a law being made by the State Legislature on the same subject on the premise that the field has been occupied by the Parliamentary law. This is expressed in what is known as the doctrine of occupied field. By this, it would mean that the law enacted by the Parliament has occupied the field in its entirety and consequently, the States have no legislative competence to make a law on the very same aspect. In other words, if a law is made by the Parliament, does it occupy the entire field so as to reduce or negate the legislative competence of the State Legislature to make a similar law? How does one det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive and coherent reading of the other Entries in List I and List II, having bearing on the concerned Entry in List III of the Constitution. Such balancing need to be done by Courts in order to ascertain whether despite legislative competence being provided to the State Legislatures under a particular Entry in the Concurrent List but owing to what has been stated in any law made under Entry in List I (Union List) having a bearing on an Entry in the Concurrent List being made subject to any Entry in the Union List, would result in the State Legislatures being denuded of legislative competence to make laws on a similar subject under an Entry in List III such as Entry 33(a) List III which is under consideration. 16.6 The application of the doctrine of occupied field is a technique adopted by the constitutional courts in order to ensure that there is no potential conflict that could arise between the State laws and the existing Parliamentary law having regard to the nature of the legislative powers, their importance in the socio-economic sphere of governance in the country and such other considerations. 16.7 Applying the aforesaid principles to the cases at hand, the question is whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect conflict between the State laws or legal regime in place and the notified order that is issued. This would result in a legal quagmire vis- -vis a scheduled industry. It cannot then be said that it is necessary to ascertain whether there is a direct conflict between the State law and the notified order made by the Central Government at every instance such an order is issued and if there is such a direct conflict then, the Parliamentary law would apply on the strength of Article 254 of the Constitution. Such a legal confusion and conundrum would not be conducive to a scheduled industry such as Fermentation Industries dealing with industrial alcohol which is a commodity of critical and significant importance in the Indian economy. 16.9 Sub-section (4) of Section 18G also states that no order in exercise of power conferred by the Section shall be called in question in any court. Thus, the question of repugnancy between an existing State law and the notified order of the Central Government cannot be raised before a court of law. Then, whether both the State law as well as the notified order can be simultaneously obeyed. If not, what would be the remedy. Subsection (4) of Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cy in the context of an Entry in List II (State List) with an Entry in List I (Union List) was considered. For immediate reference the following passage from said opinion could be extracted: 8.6 However, what is pertinent to be considered in this case is, Entry 50 - List II in juxtaposition with Entry 54 - List I. As already noted, Entry 50 - List II is a taxation Entry which empowers a State Legislature to impose tax on mineral rights. However, this power of the State Government is not an absolute power inasmuch as Entry 50 - List II itself states that the power of the State Legislature to impose tax on mineral right is subject to any limitations imposed by Parliament by law relating to mineral development . In other words, if there is any limitation imposed by the Parliament by law relating to mineral development then that would have an impact on the legislative competence of the State Legislature to impose a tax on mineral rights. The key expressions of Entry 50 - List II are taxes on mineral rights and subject to any limitations imposed by the Parliament by any law on mineral development . Thus, the Parliament can impose any limitation on the State s right to impose a tax on mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... competence to pass any law on the said aspect. The legislative competence vested with the State Legislature is, therefore, not an absolute one but is subject to a Parliamentary law enacted as per Entry 54 - List I dealing with mineral development. In the circumstance, the aforesaid observations made in Synthetics and Chemicals (7J) are in consonance with the constitutional framework of Article 246 read with the Entries in Lists I and III and the doctrine of occupied field applies in the context of Section 18G of IDRA enacted under Entry 52 List I and Entry 33(a) List III. 17. One of the contentions raised was that so long as the notified order has not been issued by the Central Government which triggers the exercise of powers under Section 18G of the IDRA, the States would have the legislative competence to pass laws under Entry 33(a) List III. In my view, the issuance of a notified order under Section 18G is only a ministerial act to be performed and to be complied with by the Central Government by a publication in the official gazette. The object of publication of a notified order in the official gazette is to inform the world at large about the contents of the said order. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct ) was assailed by the petitioners therein. It was contented that the State of Uttar Pradesh had no power to enact the said Act as the same was with respect to the subject of industries, the control of which by the Union was declared by Parliament by law to be expedient in the public interest within the meaning of Entry 52 List I and was, therefore, within the exclusive province of Parliament. It was further contended that the Act was ultra vires the powers of the State Legislature and was a colorable exercise of legislative power by the State. It was further contended that it was repugnant to the IDRA and the Essential Commodities Act, 1955 (Act 10 of 1955) also a Central Act. That in the event of this Court were to hold that the impugned Act was within the legislative competence of the State Legislature, it was void by reason of such repugnancy. It was also contended that the impugned Act stood repealed to the extent that it had been repealed by Section 16 of Act 10 of 1955 and by clause (7) of the Sugarcane (Control) Order, 1955, made in exercise of the powers conferred by Section 3 of Act 10 of 1955 (a Central Act). 17.3 It was observed that even if it was assumed that sugarc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Here, the conflict arises between action that could be taken by the Central Government under Section 18G of IDRA made by virtue of Entry 52 List I as opposed to a State law or action which could be made under Entry 33(a) List III. In such case, the doctrine of repugnancy would arise as per the first part of Article 254(1) between Entry 52 List I and Entry 33(a) List III and not in respect of the second part of Article 254(1). Thus, when the Central Government seeks to exercise power in respect of a scheduled industry under Section 18G of the IDRA it is pursuant to the said Act being made under Entry 52 List I. Hence, any action to be taken by the Central Government under Section 18G is not really an action that would be taken under Entry 33(a) List III. 18.1 On this aspect, reference must be made to judgment of this Court in State of Kerala vs. Mar Appraem Kuri Company Limited, (2012) 7 SCC 106 ( Mar Appraem Kuri Company ). The Constitution Bench of this Court speaking through Kapadia, C.J., considered the question - when does repugnancy arise in the context of whether Kerala Chitties Act 23 of 1975 becoming repugnant to the (Central) Chit Funds Act 40 of 1982 under Article 254(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the Concurrent List, subject to Article 254(2) i.e. provided the provisions of the State Act do not come in conflict with those of the Central Act on the subject. [See Amalgamated Electricity Co. (Belgaum) Ltd. v. Municipal Committee, Ajmer [AIR 1969 SC 227 : (1969) 1 SCR 430] .] Thus, the expression subject to in clauses (2) and (3) of Article 246 denotes supremacy of Parliament. 18.3 In paragraph 43, it was observed as under: 43. Our Constitution gives supremacy to Parliament in the matter of making of the laws or legislating with respect to matters delineated in the three Lists. The principle of supremacy of Parliament, the distribution of legislative powers, the principle of exhaustive enumeration of matters in the three Lists are all to be seen in the context of making of laws and not in the context of commencement of the laws. 18.4 Dealing with the question of repugnancy and the ways in which it would arise between Parliamentary legislation and States legislation, it was observed in paragraph 47 as under: 47. The question of repugnancy between parliamentary legislation and State legislation arises in two ways. First, where the legislations, though enacted with respect to ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest that the Union should take under its control the food industry. Consequently, clause (b) of Entry 33 List III which speaks of food stuffs, including edible oils seeds, and oils would be impacted on account of the FSSA, 2006 and the declaration made therein pursuant to Entry 52 List I to the extent of the control under the said Act. 20. The reason for the aforesaid view would have to be also considered from the point of view of the fact that when an industry is taken control of by the Union by specifying it in the First Schedule of the IDRA, it becomes a scheduled industry and to the extent of control envisaged as per the Schedule and as per the provisions of IDRA. It is only those industries which are critical and of vital significance to the Indian economy which are taken control of by the Union and one such industry is Fermentation Industries , which inter alia comprises of industrial alcohol both as a product and as a raw material for other industries. 21. Conversely, if any industry is not a scheduled industry and does not come within the scope and ambit of First Schedule of the IDRA, in such an event, not only Entry 24 - List II but also Entries 26 and 27 - List II wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sive powers to make laws by State Legislatures in respect of matters enumerated in List II being subject to clauses (1) and (2) of Article 246, i.e., subject to the Union List and the Concurrent List is in a case of conflict of laws which is irreconcilable. 23. Any other view would result in a situation wherein the State Legislatures on the strength of Entry 33(a) List III would have their own legislations on the premise that there is no notified order issued by the Central Government in respect of the scheduled industry under Section 18G of the IDRA, and if subsequently in respect of a product of a scheduled industry, the Central Government is to issue a notification under Section 18G of the IDRA, the laws that are in operation in the various States would become repugnant if there is a direct conflict between the said State laws with the notified order issued by the Central Government under Section 18G of the IDRA. This would result in a legal quagmire and uncertainty leading to confusion. Therefore, for this reason also States cannot have legislative competence to pass laws or take any action in respect of any product of a scheduled industry from the moment Section 18G has been i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey contributor to the growth of the sector . It also notes that several alcohol-based chemicals are made using industrial alcohol and are used as building blocks for various downstream industries such as synthetic fibres and synthetic yarn, drugs and pharmaceuticals, agrochemicals, personal care products, dyestuffs, pigments, flavours fragrances etc. Further, the PC Report notes that alcohol based chemical industry contributes to green chemistry as chemicals are manufactured using ethanol instead of being manufactured through the petro-chemical route. It also notes that they contribute to foreign exchange reserves. 25.2 As regards blending of ethanol with petrol, the contribution of Ethanol Blended with Petrol (EBP) programme of the Government of India appears significant. In this programme, fuel-grade ethanol is blended with petrol and is sold by Oil Marketing Companies (OMCs) for use as a fuel in automobiles. In response to an Unstarred Question No.2764 answered on 20th December, 2023, the Minister of State for Ministry of Consumer Affairs, Food Public Distribution had answered that: i) The Government of India has been implementing EBP programme and has fixed the target of 20% bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st I. This is expressly so having regard to Entry 33(a) List III as any law regarding trade and commerce in, and the production, supply and distribution of the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as such products, would be subject to a law made as per Entry 52 List I i.e., IDRA. This is because a Parliamentary law which is made by virtue of an Entry under List I has supremacy over any other law in List II or List III when they are irreconcilable or when the doctrine of occupied field applies respectively. 28. In Mineral Area Development Authority, I have voiced similar concerns as in the present case in the following words: 36.3 The Government of India Act, 1935 was the first comprehensive blueprint for legislative division of power in India between federal, provincial and concurrent spheres which resolved residuary powers to rest with the Federal Government. Though there are apparent similarities between the Government of India Act, 1935 and the Indian Constitution, yet factors, such as, regulation of economic competition and the develop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c issues of common Union- State concern will be stymied. The federal principle of unity in diversity will be very much a casualty. The extreme proposal that the power of Parliament to legislate on a Concurrent topic should be subject to the prior concurrence of the States, would, in effect, invert the principle of Union Supremacy and convert it into one of State Supremacy in the Concurrent sphere. The very object of putting certain matters in the Concurrent List is to enable the Union Legislature to ensure uniformity in laws on their main aspects throughout the country. The proposal in question will, in effect, frustrate that object. The State Legislatures because of their territorially limited jurisdictions, are inherently incapable of ensuring such uniformity. It is only the Union, whose legislative jurisdiction extends throughout the territory of India, which can perform this preeminent role. The argument that the States should have legislative paramountcy over the Union is basically unsound. It involves a negation of the elementary truth that the 'whole' is greater than the 'part'. (emphasis supplied) As the paragraphs extracted above elucidate, the Commission w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an abuse and, therefore, pass legislations or take State action in that regard having regard to Article 47 of the Constitution of India. III. Entry 33(a) List III (Concurrent List) and any law made or to be made by the State Legislatures under the said Entry is subject to Parliamentary law made either under Entry 52 List I or under Entry 33(a) List III in terms of the first part and second part of Article 254(1) respectively. Thus, if any law has been made by the Parliament by virtue of Entry 52 List I, such as, the IDRA and there is an intention to occupy the field, the State law would be subject to the doctrine of occupied field. Thus, Section 18G of the IDRA which has been made by virtue of Entry 52 List I thereof would prevail on the basis of the aforesaid doctrine. Consequently, it is held that issuance of a notified order under Section 18G of the IDRA is neither a sine qua non nor is it a condition precedent for the State Legislatures to restrain exercise of powers under Entry 33(a) List III. In other words, the mere insertion of Section 18G to the IDRA implies that the Parliament has intended to occupy the field demarcated under the aforesaid provision. Also, a notified ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Industries is a controlled industry and I have now clarified that it does not take within its ambit intoxicating liquors or potable alcohol. The judgment in Synthetics and Chemicals (7J) correctly held on a conspectus reading of Entry 8 List II, Entry 6 - List II and Article 47 that State Legislatures have the competence to ensure that industrial alcohol or non-potable alcohol is not diverted and misused as a substitute for potable alcohol. Secondly, the judgment has correctly considered the significance of insertion of Section 18G to the IDRA which is a Parliamentary Law made under Entry 52 List I and the consequences that follow in light of the doctrine of occupied field in the context of Fermentation Industries , a scheduled industry, by bearing in mind the first part of Article 254(1) of the Constitution. Thirdly, the reasons assigned in Synthetics and Chemicals (7J) for invoking the doctrine of occupied field in the context of Fermentation Industries and in the context of Section 18G of the IDRA would equally apply to all other scheduled industries under the said Act. Any interference with the said legal position would have a cascading effect on other scheduled industries ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the intentions of the framers of the Constitution and the nature and structure of the Indian economy and the need for a uniform development throughout the country of certain industries which have been taken control of by the Union. This approach has been adopted in Synthetics and Chemicals (7J). Eighthly, the principle of federal balance must yield to the doctrine of Parliamentary supremacy in certain areas such as when laws are made under Entry 52 or Entry 54 or Entry 7 List I such as in the present cases. This is because of the unique manner in which Article 246 of the Constitution is worded and the division of legislative subjects between the Parliament and the State legislatures, having regard to the unique federal structure in India with the balance tipping in favour of the Union in certain niche areas of legislation and governance. Ninthly, the Amendment Act, 2016 has brought much needed clarity on the issue and is the correct position of law compatible with the scheme of legislative competence as under our Constitution. I have already held that merely because industrial alcohol can be easily manufactured into or misused to become intoxicating liquors would not grant States ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government to cover the entire field in respect of Entry 33(a) - List III so as to oust the States' competence to legislate in respect of matters relating thereto? Ans.: Yes, the mere enactment of section 18G of the IDRA gives rise to a presumption that it was the intention of the Parliament and Central Government to cover the entire field in respect of Entry 33(a) - List III so as to oust the States' competence to legislate in respect of matters relating thereto. Answer given to question (3) above is reiterated here. Ques.5. Does the mere presence of Section 18G of the above Act, oust the State's power to legislate in regard to matters falling under Entry 33(a) of List III? Ans.: Yes, the mere presence of Section 18G of the IDRA would oust the State's power to legislate in regard to matters falling under Entry 33(a) - List III. The doctrine of occupied field applies. Ques.6. Does the interpretation given in Synthetics and Chemicals case, (1990) 1 SCC 109 in respect of Section 18G of the Industries (Development and Regulation) Act, 1951, correctly state the law regarding the States' power to regulate industrial alcohol as a product of the scheduled industry und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing liquor covered by Entry 8 of List II in exercise of the power under Article 246 read with Entry 52 of List I; I agree. d. The judgments of the Bombay High Court in FN Balsara v. State of Bombay (supra), this Court in FN Balsara (supra) and Southern Pharmaceuticals (supra) did not limit the meaning of the expression intoxicating liquor to its popular meaning, that is, alcoholic beverages that produce intoxication. All the three judgments interpreted the expression to cover alcohol that could be noxiously used to the detriment of health; The context of the controversy must be borne in mind in the said cases. The aforesaid decisions in substance limited the meaning of the expression intoxicating liquors to its popular meaning i.e. alcoholic beverages that produce intoxication. Therefore, in the context of prohibition of intoxicating liquor as a beverage, there could not have been prohibition of production of alcohol used for medicinal and toilet preparation as well as industrial alcohol or non-potable alcohol. e. The expression intoxicating liquor in Entry 8 has not acquired a legislative meaning on an application of the test laid down in Ganon Dunkerley (supra); The expression in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the point of view of alcohol being used as a raw material and final product such as hand sanitizer containing alcohol. The potential misuse of alcohol cannot be the basis for interpreting an Entry such as Entry 8 List II. Ultimately, the Fermentation Industries have to be borne in mind which takes within its canvas only non-potable / industrial alcohol . The aspect of public health having a corelation to Entry 8 List II dealing with intoxicating liquor and the misuse of alcohol cannot be a guide while interpreting the content of the said Entry and therefore, its scope and ambit being amplified beyond what it really envisages as a field of legislation for the States to legislate upon. h. The judgment in Synthetics (7J) (supra) is overruled in terms of this judgment; The judgment in Synthetics and Chemicals (7J) need not be overruled in relation to Section 18G of the IDRA and it continues to be good law in the context of what is comprised in the expression industrial alcohol and intoxicating liquors except what has been clarified above in Entry 8 List II. i. Item 26 of the First Schedule to the IDRA must be read as excluding the industry intoxicating liquor , as interpreted in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, whether grinned or ungrinned, and cotton seed; and (e) Raw jute. 6 8. Intoxicating liquors, that is to say, the production, manufacture, possession, transport, purchase and sale of intoxicating liquors 7 84. Duties of excise on tobacco and other goods manufactured or produced in India except- (a) Alcoholic liquors for human consumption; (b) Opium, Indian hemp and other narcotic drugs and narcotics, But including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry. But including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry. 8 51. Duties of excise on the following goods manufactured or produced in the State and counterveiling duties at the same or lower rates on similar goods manufactured or produced elsewhere in India:- (a) Alcoholic liquors for human consumption; (b) Opium, Indian hemp and other narcotic drugs and narcotics, But not including medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this entry. 9 246. Subject matter of laws made by Parliament and by the Legislatures of States. 10 IDRA 11 Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and charging of fees therefor. (3) Where in pursuance of any order made with reference to clause (d) of sub-section (2), any person sells any article, there shall be paid to him the price therefor (a) where the price can consistently with the controlled price, if any, be fixed by agreement, the price so agreed upon; (b) where no such agreement can be reached, the price calculated with reference to the controlled price, if any, fixed under this section; (c) where neither clause (a) nor clause (b) applies, the price calculated at the market-rate prevailing in the locality at the date of sale. (4) No order made in exercise of any power conferred by this section shall be called in question in any Court. (5) Where an order purports to have been made and signed by an authority in exercise of any power conferred by this section, a Court shall, within the meaning of the Indian Evidence Act, 1872 (1 of 1872), presume that such order was so made by that authority. Explanation. In this section, the expression article or class of articles relatable to any scheduled industry includes any article or class of articles imported into India which is of the same nature or description as the article o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... List I have exclusive privilege to legislate on intoxicating liquor or alcoholic liquor for human consumption. Hence, so long as any alcoholic preparation can be diverted to human consumption, the States shall have the power to legislate as also to impose taxed etc. In this view, denaturation of spirit is not only an obligation on the States but also within the competence of the States to enforce. [ emphasis supplied] 44 (1997) 2 SCC 727 45 (1997) 2 SCC 727 [12] 46 (1997) 2 SCC 727 [23] 47 (1997) 5 SCC 758 48 (1995) 5 SCC 753 49 In this case, the challenge was to the levy of excise duty on wastage in the preparation of Indian Made Foreign Liquor (IMFL), pipeline wastage and obscuration (which is the process of adding caramel to spirit for the preparation of rum. The Bench relied on the observations in Synthetics (7J) that the phrase alcoholic liquor for human consumption means the liquor that is consumable as it is to hold that the State does not have the power to levy excise duty on the stages of manufacture or preparation of the liquor. 50 (1995) 5 SCC 753 [14] 51 Deccan Sugar and Abkari Co. Ltd. V. Commissioner of Excise, AP (1998) 3 SCC 272 52 (2004) 1 SCC 243 53 (2004) 1 SCC 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illips India Ltd. V. State of UP (2005) 2 SCC 515 88 See Harakchand Ratanchand Banthia v. Union of India, (1969) 2 SCC 166 89 Seventh Schedule to the Constitution of India; Entry 71 to List I, Entry 5 to List II, Entry 13 of List II, Entry 17 of List II, Entry 18 of List II, Entry 42 of List II 90 Seventh Schedule to the Constitution of India; Entry 25 of List II 91 Seventh Schedule to the Constitution of India; Entry 21 of List II 92 Seventh Schedule to the Constitution of India; Entry 69 of List I 93 Seventh Schedule to the Constitution of India; Entry 6 of List II 94 Other examples include Entry 13 of List II which specifies the meaning of communications to mean roads, bridges, ferries and Entry 42 of List II which specifies State pensions to mean pensions payable by the State or out of the Consolidated Fund of the State. 95 Other examples include Entry 17 of List II which reads as water, that is to say, water supplies, irrigation and canals, drainage and embankments, water storage and water power subject to the provisions of entry 56 of List I and Entry 18 of List II which reads as Land, that is to say, rights in or over land, land tenures including the relation of landlord and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10 (1970) 2 SCR 100 111 (1976) 3 SCR 688 112 (1980) 4 SCC 136 [8] 113 2. Declaration as to expediency of control by Union: It is hereby declared that it is expedient in the public interest that the Union should take under its control the industries specified in the First Schedule. 114 2. Declaration as to expediency of Union Control.- It is hereby declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent hereinafter provided. [emphasis supplied] 115 (1980) 4 SCC 136 [11] 116 44.[ ] It seems to us that the observations made by this Court in Hingir-Rampur Coal Co. Ltd. v. State of Orissa [AIR 1961 SC 459 : (1961) 2 SCR 537] , State of Orissa v. M.A. Tulloch and Co. [AIR 1964 SC 1284 : (1964) 4 SCR 461] , Baijnath Kadio v. State of Bihar [(1969) 3 SCC 838, 847-848 : AIR 1970 SC 1436 : (1970) 2 SCR 100, 113] and State of Haryana v. Chanan Mal [(1977) 1 SCC 340, 351 : AIR 1976 SC 1654 : (1976) 3 SCR 688, 700] cannot be of assistance in this behalf. In each of those cases, the declaration made by Parliament in the concerned enactment limited the control of the mines and the devel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e called, the industries engaged in production and manufacture of intoxicating liquors from the State list to Union List. As a matter of fact, Parliament cannot take over the control of industries engaged in the production and manufacture of intoxicating liquors by making a declaration under Entry 52 of List I, since the said entry governs only Entry 24 in List II but not Entry 9 in List II. 123 28. [ ] Article 246 cannot be invoked to deprive the State Legislatures of the powers inhering in them byvirtue of entries in List II. To wit, once an enactment, in pith and substance, is relatable to Entry 8 in List II or for that matter any other entry in List II, Article 246 cannot be brought into yet hold that State Legislature is not competent to enact that law. 124 (1963) 3 SCR 209 125 (2018) 4 SCC 743 126 Calcutta Gas company (supra) and McDowell (supra) 127 1950 SCC OnLine Bom 57 128 Bombay Prohibition Act 129 Bombay Prohibition Act 1949; Section 2(22) 130 Bombay Prohibition Act 1949; Section 2(24) 131 1950 SCC OnLine Bom 57 [36] 132 31. Intoxicating liquors and narcotic drugs, that is to say, the production, manufacture, possession, transport, purchase and sale of intoxicating liqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .e. their use as a substitute for alcoholic beverages. [emphasis supplied] 145 66. Fees in respect of any of the matters in this List, but not including fees taken in any Court. 146 (1971) 2 SCC 236 [3] 147 (1971) 2 SCC 236 [11] 148 The ratio of the rule of interpretation that words of legal import occurring in a statute should be construed in their legal sense is that those words have, in law acquired a definite and precise sense, and that, accordingly, the legislature must be taken to have intended that they should be understood in that sense. In interpreting an expression used in a legal sense, therefore, we have only to ascertain the precise connotation which it possesses in law. [emphasis supplied] 149 It will be seen from the foregoing that there is practical unanimity of opinion as to the import of the word sale in its legal sense 150 Now, in its popular sense, a sale is said to take place when the bargain is settled between the parties, though property in the goods may not pass at that stage, as where the contract relates to future or unascertained goods, and it is that sense that the learned Judge would appear to have had in his mind when he spoke of a commercial or busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 3 166 The Devolution Rules were made by the Governor General in Council with the sanction of the Secretary of State in Council in exercise of the powers conferred by Sections 45A and 129A of the Government of India Act 1919. 167 Government of India Act 1935, Entry 31 of List I 168 Government of India Act 1935, Entry 19 of List III 169 Constitution of India 1950, Entry 59 of List I 170 Constitution of India 1950, Entry 19 of List III 171 The reason for providing Parliament the power to enact laws with respect to the excise duty on medicinal and toilet preparations containing alcohol is reflected in the footnote to Entry 86 of List I in the Draft Constitution of India 1948 as follows: The committee is of the opinion that duties of excise on medicinal and toilet preparation containing alcohol or any substance included in sub-paragraph (b) of this entry should be included in this entry as duties leviable by the Union, as it thinks that uniform rates of excise duty should be fixed in respect of these goods in all states for the sake of development of the pharmaceutical industry. The levy of different rates in different States is likely to lead to discrimination in favour of goods i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... List I 186 Constitution of India 1950; Entry 8 of List II 187 Joint Committee on Indian Constitutional Reform (Volume I Part I) 148-149. 188 Report of the Joint Committee on Indian Constitutional Reform; Entry 19(ii) of List II 189 See Rainbow Steels v. Sales Tax Commissioner, UP AIR 1981 SC 2010; State of Bombay v. Hospital Mazdoor Sabha, AIR 1960 SC 610, 613; Rohit Pulp and Paper Mills Ltd v. Collector of Central Excise, AIR 1991 SC 754 190 Constituent Assembly Debates (2 September 1949) Volume IX 191 MPV Sundararamier Co. v. State of Andhra Pradesh, (1958) 9 STC 298 192 Unless the District Council by a public notification directs to give effect to the Act. The District Council may also direct that the Act shall have effect subject to exceptions or modifications ; See Paragraphs 12, 12AA and 12B of the 6th Schedule. 193 43. [ ] But this power stops with the denaturation of the industrial alcohol. Denatured spirit has been held in Vam Organic-I to be outside the seism of the State Legislature. Assuming that denatured spirit may by whatever process be renatured (a proposition which is seriously disputed by the respondents) and then converted into potable liquor, this would not giv ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
