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2011 (9) TMI 71 - SC - VAT and Sales TaxPoint of levy of state excise duty on liquor – Held that: - the point at which the liquor manufactured by the brewery is exigible to excise duty is the stage when the finished product (beer) capable of being consumed by human beings as a beverage or drink, comes into existence that is, after the process of fermentation and filtration Point of levy of state excise duty on beer – held that: - the State has legislative competence to levy excise duty on beer either after the completion of the process of fermentation and filtration, or after fermentation. Wastage - whether the procedure adopted by the appellant for ascertaining the excess wastage (or shortage in quantity) and levying duty and additional duty thereon, is legal and valid. – Held that: - When the quantity of the liquid in the fermentation vessels were measured, on account of fermentation, the liquid was already in the process of conversion into an alcoholic liquor for human consumption', though had not become a finished product of beer. Therefore, the principles in Baldev Singh and A. Sanyasi Rao, will apply and not the decision in Modi Distillery. Therefore we hold that there is no infirmity in the method adopted by the excise department to arrive at the excess wastage or in making a demand for excise duty and additional duty in regard to such excess wastage. Allowance of excess wastage - Held that: - The brewery having obtained the bottling licence subject to the special conditions which include the condition in Rule 7(11) of the Bottling Rules, cannot ignore the said Rule and contend that the allowance for losses in bottling could be more than one percent, that is upto ten per cent. - there is no merit in the contention of the breweries that they are entitled to allowance of ten per cent towards losses in bottling and storage after the excisable article has left the Brewery. The appeals are therefore liable to be dismissed.
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