TMI Blog1964 (3) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... are five connected appeals on certificates granted by the High Court of Andhra Pradesh. They involve a common question of law and will be dealt with together. The brief facts necessary to understand the question of law raised in these appeals are these. The appellants manufacture medicines in which they have to use alcohol. Before Parliament passed the Medicinal and Toilet Preparations (Excise Duties) Act, No. 16 of 1955, (hereinafter referred to as the Act), the appellants were working under licences granted -under the Hyderabad Abkari Act, No. 1 of 1316-F. Under that Act certain rules called the Medical Preparations and Spirituous Rules, 1345-F were framed and r. 36 thereof provided that the expenses of the establishment for the supervision of the work shall be borne by the pharmaceutical laboratory (licensee) as per the decision of the Commissioner Excise . It appears that for the manufacture of medicines, the appellants used to be supplied with alcohol. Further the State Government posted on the bonded manufacturies of the appellants certain supervisory excise staff, and r. 36 was obviously framed to reimburse the Government for expenses incurred in that behalf. After the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 1345-F Rules can still be said to survive. There is no doubt that the Hyderabad Abkari Act was a general Act and before the Constitution came into force, r. 36 of the 1345-F Rules would be good law. Under the Constitution, however, medicinal and toilet preparations came under entry 84, List I of the Seventh Schedule to the Constitution, which provides for 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 containing opium, Indian hemp and other narcotic drugs and narcotics. No charge could thereafter be levied on the manufacture of medicinal preparations except by the Union in the shape of duties under item 84 of List I. * The State Government however insisted on the payment of the charges. But under Art. 277 of the Constitution any taxes, duties, cesses or fees, which, immediately before the commencement of this Constitution were being lawfully levied by the Government of any State may, notwithstanding that those taxes, duties, cesses o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ations and Spirituous Rules must be held to be no longer good law so far as it applies to medicinal preparations. That is one reason why we consider that r. 36 must be held to have been repealed after the coming into force of the Act and the Rules framed thereunder. The proviso to s. 21 on which reliance has been placed cannot change the position ciew of the new Rules framed in 1956 with respect to medicinal preparations. As soon as the new Rules came into force the old rules must fall and there is a specific provision in the new Rules (namely r. 143) which says that all rules made under any law corresponding to the Act are hereby repealed. We may refer in this connection to the construction of r. 36 of the Rules of 1345F. It provides that the expenses of the establishment for the super-vision of the work shall be borne by the pharmaceutical laboratory. The establishment which has to be paid for under r. 36 therefore is for the supervision of the work done by the pharmaceutical laboratories. Now the work done by a pharmaceutical laboratory is to manufacture medicinal preparations. Rule 36 therefore provides that expenses of the establishment for the supervision of the work of me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner to determine the size of the supervisory staff in consultation with the licencee. It is clear therefore that under the 1956 Rules supervisory staff is attached to bonded manufacturies which manufacture medicinal preparations. This is also the purpose of r. 36. Further r. 141 provides that the licencee of a bonded manufactory or warehouse shall, where so required by the Excise Commissioner, provide the officer and the staff posted to the manufactory or bonded warehouse with suitable lodging conveniently situated to the factory or bonded warehouse premises at a rent not exceeding 10 per cent of the pay of each officer so accommodated. If for any reason the licencee is not able to provide such accommodation he shall provide suitable accommodation to the satisfaction of the Excise Commissioner near the manufactory or bonded warehouse recovering only 10 per cent of the pay of the occupant. Then r. 45 provides that tile officer-incharge shall exercise such supervision as is required to ensure that alcohol issued for a certain preparation is added to the materials which go to make that preparation and that no portion of such alcohol is diverted to other purpose. It is cl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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