1965 (9) TMI 48 - SUPREME COURT

Whether the enhancement of the levy by notification dated March 31, 1961 insofar as it enhanced the levy from ₹ 40 to ₹ 70 per L.P. Gillon infringes any constitutional probibitions?

Whether the original duty alone would be sustained or also the enhanced duty which was introduced in 1961?

Held that:- The adaptation made the Act valid vis-a-vis the Government of India Act, 1935. When the Act was valid, the notification issued in 1937 was also valid. The Excise Acts, as adapted, continued to be law under the Government of India Act, 1935. The present Constitution has made no change either in the distribution of legislative power or the entries and has further said in Art. 372 that all existing laws continue to be of full force and effect. The imposition of countervailing duty at ₹ 40 per London proof gallon continued to be valid.

If the old duty it the old rate is sustainable there is no reason why the absence of production of foreign liquor in the State would make any difference to the enhancement of the duty to ₹ 70 per London proof gallon. So long as the Act is valid, and that is beyond doubt, the notification can be changed. The duty could always be made less and there is no reason why it could not be made more provided the imposition of duty on locally produced goods was not made lower. If production of foreign liquor is not a condition precedent to the validity of the Act because of historical reasons there is no bar to the validity of the notification which takes its force from the valid Act. Appeal dismissed.