TMI Blog1997 (12) TMI 640X X X X Extracts X X X X X X X X Extracts X X X X ..... not manufacture rectified spirit as required to be manufactured in the light of the norms alleged in the show-cause notices based on utilisation of molasses. The notices were replied to by the appellants and ultimately orders were passed by the Commissioner of Excise, Andhra Pradesh State computing the alleged loss in the manufacture of rectified spirit and on that basis excise duties were computed and were directed to be paid by the appellants concerned. They went in writ petitions before the High Court. The writ petitions were heard and ultimately dismissed. By obtaining special leave to appeal under Article 136 of the Constitution of India the present appeals have been filed. 3. We were informed that these appeals reached hearing bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. We proceed to elaborate: (1) So far as industries engaged in manufacturing rectified spirit meant exclusively for supply to industries (industries other than those engaged in ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned, they shall be under the total and exclusive control of the States in all respects and at all stages including the establishment of the distillery. In other words, where the entire rectified spirit produced is supplied for potable purposes -- or to the extent it is so supplied, as the case may be -- the levy of excise duties and all other control shall be that of the States, According to the State Governments, most of the distilleries fall under this category. (3) So far as industries engaged in the manufacture of rectified spirit, both for the purpose of (a) supplying it to industries (other than industries engaged in obtaining or manufacturing potable liquors/intoxicating liquors) and (b) for obtaining or manufacturing or suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 to be kept in view that the aforesaid decision rendered in Bihar Distillery Case (Supra) by a Bench of two learned Judges of this Court was strictly concerned with the question whether the State could cancel licences given to a distillery manufacturing rectified spirit on the grounds as alleged to be relevant for such cancellation. Therefore, strictly speaking there was no occasion for this Court in Bihar Distillery Case (Supra) to consider the wider question whether any excise du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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