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TMI Blog2024 (11) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... Civil Appeal No. 671 of 2008 With Civil Appeal No. 672 of 2008 With Civil Appeal No. 688 of 2008 With Civil Appeal No. 750 of 2008 And With CIVIL APPEAL NO.152 OF 2007 CIVIL APPEAL NO.153 OF 2007 CIVIL APPEAL NO.154 OF 2007 CIVIL APPEAL NO.580 OF 2008 CIVIL APPEAL NO.610 OF 2008 CIVIL APPEAL NO.671 OF 2008 CIVIL APPEAL NO.672 OF 2008 CIVIL APPEAL NO.688 OF 2008 CIVIL APPEAL NO.750 OF 2008 CIVIL APPEAL NO.5093 OF 2011 CIVIL APPEAL NO.6768 OF 2014 CIVIL APPEAL NO.2084 OF 2020 CIVIL APPEAL NO.4987 OF 2021 SPECIAL LEAVE PETITION (C) NO.16505 OF 2004 SPECIAL LEAVE PETITION (C) NO.19275 OF 2004 SPECIAL LEAVE PETITION (C) NO.26110 OF 2004 SPECIAL LEAVE PETITION (C) NO.26111 OF 2004 SPECIAL LEAVE PETITION (C) NO.20204 OF 2012 SPECIAL LEAVE PETITION (C) NO.20519 OF 2014 SPECIAL LEAVE PETITION (C) NO.25447 OF 2014 SPECIAL LEAVE PETITION (C) NO.3160 OF 2015 SPECIAL LEAVE PETITION (C) NO.4057 OF 2015 SPECIAL LEAVE PETITION (CIVIL) ____CC NO.7999 OF 2017 SPECIAL LEAVE PETITION (C) NO.27241 OF 2019 SPECIAL LEAVE PETITION (C) DIARY NO.41507 OF 2019 SPECIAL LEAVE PETITION (C) NO.18686 OF 2022 SPECIAL LEAVE PETITION (C) DIARY NO.7447 OF 2023 SPECIAL LEAVE PETITION (C) NO.18582 OF 2023 CJI [Dr Dhan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -e-hina Dua, Adv. Mr. Saif Zia, Adv. Mr. Harshit Khanduja, Adv. Mr. Sahib Kochar, Adv. Ms. Ritika Kohli, Adv. Mr. Rajiv Dutta, Sr. Adv. Mr. Sanjeev Kumar Singh, Adv. Mr. Kumar Dushyant Singh, AOR Mr. Shighra Kumar, Adv. Mr. Bhishm Pratap Singh, Adv. Mr. Devansh Shekhar, Adv. Ms. Pooja Singh, Adv. Ms. Subasri Jaganathan, Adv. Mr. Aakash Bajaj, Adv. Mrs. Vanita Bhargava, Adv. Mr. Ajay Bhargava, Adv. Mr. Avirat Kumar, Adv. Ms. Nandita Chauhan, Adv. Mr. Sanjeev K.kapoor, Adv. Ms. Tijil Thakur, Adv. M/S. Khaitan & Co., AOR Mr. Ajit Sharma, AOR 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. M. P. Vinod, AOR Mr. S. Nandakumar, Sr. Adv. Ms. Deepika Nandakumar, Adv. Mr. Niraj Gupta, Adv. Mr. Aakash Elango, Adv. Mr. Naresh Kumar, AOR Mrs. Nanita Sharma, AOR Mr. Dhruv Agrawal, Sr. Adv. Mr. Nishit Agrawal, AOR Ms. Kanishka Mittal, Adv. Ms. Upasna Agrawal, Adv. Mr. Shrey Kapoor, Adv. Ms. Vanya Agrawal, Adv. Mr. Krishnamohan K., AOR Ms. Dania Nayyar, Adv. Mr. Praveen Chaturvedi, AOR Mr. J.S.Attri, Sr. Adv. Mr. Vikas Kumar Singh, Adv. Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Dhananjaya Mishra, AOR Mr. Siddhant Buxy, Adv. Mr. Navneet Dogra, Adv. Mr. Manish Kumar, AOR Mr. Shivam Singh, Adv. Ms. Bahuli Sharma, Adv. Mr. Ishwar Singh, Adv. Mr. Suyash Vyas, Adv. Mr. Divyansh Mishra, Adv. Mr. Amrita Jhamb, Adv. Mr. Shubham Janghu, Adv. Mr. Rajiv Singh, Adv. Mr. Yoshit Jain, Adv. Mr. Abhinav Singh, Adv. Mr. Dhruv Agrawal, Sr. Adv. Mr. Nishit Agrawal, AOR Ms. Kanishka Mittal, Adv. Ms. Upasna Agrawal, Adv. Mr. Shrey Kapoor, Adv. Ms. Vanya Agrawal, Adv. Mr. Sameer Abhyankar, AOR Mr. Amish Tandon, Adv. Mr. Rahul Kumar, Adv. Mr. Aakash Thakur, Adv. Ms. Ayushi Bansal, Adv. Ms. Ria Dhawan, Adv. Ms. Charchika Yadav, Adv. Mr. Sarthak Dora, Adv. Ms. Vaishnavi, Adv. 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. Ankit Roy, AOR Mr. Abhimanyu Tewari, AOR Mrs. Eliza Barr, Adv. Ms. Eliza Bar, Adv. Mr. Jatinder Kumar Bhatia, AOR Mr. Sravan Kumar Karanam, AOR Ms. Tayade Pranali Gowardhan, Adv. Mr. Aniket Singh, Adv. Mr. Jaideep Gupta, Sr. Adv. Ms. Astha Sharma, AOR Mr. Srisatya Moh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ...... 51 a. The scope of Entry 8 .............................................................................. 52 I. The meaning of 'that is to say' ............................................................ 52 II. Product or industry based entry .......................................................... 55 b. Scope of Entry 52 of List I: the absence of "to the extent to which" ....... 57 c. Reconciling the potential overlap between Entry 52 of List I and Entry 8 of List II ......................................................................................................... 63 iv. Scope of Entry 8: Meaning of 'intoxicating liquor' ............................... 70 a. Precedent on the interpretation of 'intoxicating liquor': exploring FN Balsara and Southern Pharmaceuticals ................................................... 71 b. The legal import of 'intoxicating liquor' ................................................... 79 c. Evolution of the legislative lists on 'intoxicating liquor' ........................... 85 d. The harmonious interpretation ............................................................... 96 v. The correctness of the decision in Synthetic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and First Amendment) Act 2016) enabled Parliament to levy duties of excise on tobacco and other goods manufactured or produced in India except alcoholic liquors for human consumption but including medicinal and toilet preparations containing alcohol.7 Entry 51 of List II confers the State Legislature the competence to levy duties of excise, inter alia, on alcoholic liquors for human consumption but not including medicinal and toilet preparations containing alcohol.8 3. In exercise of the power under Article 2469 read with Entry 52 of List I, Parliament enacted the Industries (Development and Regulation) Act 195110. Section 2 of IDRA stipulates that it is expedient in public interest that the Union should take control of the industries specified in the First Schedule to the enactment. Item 26 of the First Schedule read as follows: "26. Fermentation industries: (1) Alcohol (2) Other products of fermentation industries" 4. In 2016, Item 26 of the First Schedule to the IDRA was amended to exclude potable alcohol from the ambit of the Item.11 Item 26 reads as follows after the amendment: "26. Fermentation industries (other than potable alcohol): (1) Alcohol (2) Other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the levy of vend fee. A two-Judge Bench of this Court in Synthetics (2J) (supra) heard the writ petition and the appeals against the judgments of the Allahabad High Court together. Three issues arose before the Bench. On the issue of the meaning of the phrase 'intoxicating liquor' in Entry 8, the two-Judge Bench referred to the decisions of this Court in State of Bombay v. FN Balsara20, Nashirwar (supra) and Har Shanker (supra) and held that the decisions indicate that the phrase 'intoxicating liquor' in Entry 8 of List II comprises of liquor which contains alcohol, both potable and non-potable.21 The second issue was whether in view of IDRA, the power of the State to regulate alcohol (both potable and non-potable) was denuded. In particular, reference was made to the notification issued by the Union under Section 18-G of the IDRA prescribing the price of various types of alcohol and rectified spirit. The two-Judge Bench referred to the decision of a three-Judge Bench of this Court in Tika Ramji v. State of UP22 and entry 33 of List III to hold that the State Legislature had the power to legislate regarding the production, supply and distribution of the products of the industries n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e borne in mind that by common standards ethyl alcohol (which has 95 per cent) is an industrial alcohol and is not fit for human consumption. The petitioners and the appellants were manufacturing ethyl alcohol(95 per cent) (also known as rectified spirit) which is an industrial alcohol. ISI specification has divided ethyl alcohol (as known in the trade) into several kinds of alcohol. Beverage and industrial alcohols are clearly and differently treated. Rectified spirit for industrial purposes is defined as "spirit purified by distillation having a strength not less than 95 per cent of volume by ethyl alcohol". Dictionaries and technical books would show that rectified spirit (95 per cent) is an industrial alcohol and is not potable as such. It appears, therefore, that industrial alcohol which is ethyl alcohol (95 per cent) by itself is not only nonpotable but is highly toxic. The range of spirits of potable alcohol is from country spirit to whisky and the ethyl alcohol content varies between 19 to about 43 per cent. These standards are according to the ISI specifications. In other words ethyl alcohol (95 per cent) is not alcoholic liquor for human consumption but can be used as a r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions and practice, we are clearly of the opinion that in respect of industrial alcohol the States are not authorised to impose the impost they have purported to do. In that view of the matter, the contentions of the petitioners must succeed and such impositions and imposts must go as being invalid in law so far as industrial alcohol is concerned. We make it clear that this will not affect any impost so far as potable alcohol as commonly understood is concerned. It will also not affect any imposition of levy on industrial alcohol fee where there are circumstances to establish that there was quid pro quo for the fee sought to be imposed. This will not affect any regulating measure as such." 14. Paragraph 88 lays down the following three principles: a. States do not have the competence to levy tax on industrial alcohol; b. States have the competence to levy tax on potable alcohol; and c. States have the competence to levy fee on industrial alcohol. 15. Justice Oza in his concurring opinion held: a. The legislative entries in List I and List II clearly demarcate the taxing powers of Parliament and State Legislature. Entry 84 of List I covers levy of excise duty on alcoholi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Synthetics (7J) (supra) that States have the power to enact legislation in the nature of prohibiting potable liquor.40 In Vam Organic Chemicals v. State of UP41 ["Vam Organic I"], the rules issued under the UP Excise Act providing for power to issue licenses for denaturation of spirit and levy of denaturing fee was challenged. Justice A M Ahmadi (as the learned Chief Justice then was) writing for the two-Judge Bench noted that Synthetics(7J) (supra) did not hold that the State will not have any power over 'industrial alcohol'.42 Specifically, the two-Judge Bench referred to the observations in paragraph 86(b) that the State may lay down regulations to ensure that non-potable alcohol is not misused as a substitute for potable alcohol. Justice Ahmadi observed that the process of denaturing was to ensure it was not misused as potable alcohol which would be covered by the observations in Synthetics (7J) (supra).43 18. In Bihar Distillery v. Union of India44, the petitioner challenged the State's cancellation of their license for preparing "rectified spirit" on the ground that the State lacked competence in view of Synthetics(7J) (supra). Justice B P Jeevan Reddy, writing for the two ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Justice for listing the matters before the Constitution Bench. In particular, the Bench noted the observations in (i) McDowell (supra) that the State has competence over production to sale of "intoxicating liquor"; (ii) Vam Organic I (supra), that State has competence over "denatured spirit"; and (iii) Bihar Distillery (supra) that the State's competence over "rectified spirit' depended on the purpose for which spirit was going to be used. The Bench also noted the observations of a three-Judge Bench in State of UP v. Modi Distillery48 that the State does not have the legislative competence to levy excise duty on the material or input that is used in the process of producing alcoholic liquor for human consumption by relying on Synthetics (7J) (supra)49. However, it must be noted that the Bench in Modi Distillery (supra), specifically recorded that it does not "express any opinion in regard to the power of the State to regulate the manufacture of alcoholic liquors for human consumption."50 21. Meanwhile, another two-Judge Bench51 referred the decision in Bihar Distillery (supra) to a larger Bench on the ground that it was prima facie contrary to the scheme of legislative competenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... natured rectified spirit, of course, is wholly and exclusively industrial alcohol." (emphasis supplied) iv. The Reference Order(s) 22. Separately, the State of UP levied an ad valorem licence fee on the sale of specially denatured alcohol by a wholesale vendor to those holding a licence under Form FL 4155 of the UP Excise Act. The fee was levied under the provisions of the UP Spirit Rules. The petitioner in RP Sharma v. State of UP56 instituted a writ petition before the Allahabad High Court, inter alia, for challenging the relevant rule and for a refund of the fee collected by the state. 23. A Division Bench of the Allahabad High Court allowed the petition, relying on the decision in Vam Organic-II (supra) since the fee was levied on the sale of denatured spirit and not to ensure that rectified spirit was not diverted for human consumption. The State of UP preferred an appeal against the decision before this Court, resulting in the present proceedings. The Court issued notice on the matter and granted an interim stay of the judgment of the High Court on 27 August 2004. By its order dated 25 October 2007, a three- Judge Bench of this Court in State of UP v. Lalta Prasad57 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legislate with matters relating to Entry 33 of List III have been ousted, except to the extent as explained in the Synthetics and Chemicals case in paragraphs 63-64 of the judgment, where the State's power to regulate, as far as regulating the use of alcohol, which would include the power to make provisions to prevent and/or check industrial alcohol being used as intoxicant liquor, had been accepted. ... As submitted by Mr. Dwivedi, the 7 Judge Bench did not have the benefit of the views expressed by this Court earlier in Ch. Tikaramji case (supra) where the State's power to legislate under the Concurrent List stood ousted by legislation by the Central Government under Entry 52 of List I and also in view of Section 18-G of the Industries (Development and Regulation) Act, 1951. 36. In our view, if the decision in the Synthetics and Chemicals case (supra) with regard to the interpretation of Section 18-G of the 1951 Act is allowed to stand, it would render the provisions of Entry 33 (a) of List III nugatory or otiose. 37. We are, therefore, also of the view that this aspect of the matter requires reconsideration by a larger Bench of this Court, particularly, when the views exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cally noted that the correctness of the decision in Synthetics (7J) ought to be reconsidered by a nine Judge Bench. Thus, this Bench is not limited to the questions framed by the three-Judge Bench. B. Submissions i. Appellants' submissions 27. This Court held in Synthetics (7J) (supra) that denatured spirit is industrial alcohol and is outside the jurisdiction of States under Entry 8, List II of the Seventh Schedule to the Constitution. It held that Entry 8, List II deals only with potable alcohol. Mr Dinesh Dwivedi, learned senior counsel representing the State of UP assailed the reasoning in Synthetics (7J) (supra) and argued that the States have jurisdiction over industrial alcohol. He submitted that: a. Legislative entries are fields of legislation and must be read widely and construed liberally to maintain the federal balance. The exclusive jurisdiction of the States cannot be ousted by a Parliamentary enactment. Article 245 of the Constitution is subject to Article 246 and therefore the division of legislative powers must be given their full effect; b. The term 'intoxicating liquors' appearing in Entry 8 of List II of the Seventh Schedule to the Constitution has a ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppear irrational if 'intoxicating liquors' was understood to exclude alcohols used in industries; i. Entry 8 of List II includes alcohols used in industries. Since it is a specific entry in List II, alcohols used in industries will be excluded from the general entry on industries in Entry 24 of List II. The Union cannot take over any industry in pursuance of Entry 52 of List I unless the industry falls under Entry 24 of List II. Therefore Parliament cannot takeover industrial alcohol by making a declaration under the IDRA, which relates to Entry 52 of List I; j. Entry 8 of List II is not subject to any other entry in the Seventh Schedule. The Constitution makes specific mention where it intends a legislative field to be subject to other entries in the Seventh Schedule; and k. Synthetics (7J) (supra) fell into error by not considering the traditional meaning of 'intoxicating liquors'. It also failed to notice all previous decisions, like Ch Tika Ramji v. State of UP,59 which defined 'industry' for the purpose of Entry 24 of List II and Entry of 52 List I and delineated its scope. It held that the product of an industry notified under the IDRA falls under Entry 33 of List III. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d spirit usually undergoes denaturation for the purpose of their use in industries. This would involve payment of fees and obtaining of licenses for the process; b. The expression 'alcoholic liquor for human consumption' in Entry 51 of List II was mistakenly read as 'alcoholic liquor fit for human consumption' which has a widely different meaning.60 For example, molasses despite not being capable of final consumption, as it is, would be alcohol for human consumption. It would undergo a process for making it fit for human consumption. However, that does not take away from the fact that molasses is intended for human consumption and is susceptible to excise. Alcoholic liquor for human consumption means that the alcoholic liquor is capable of being consumed by humans. It would fall under Entry 51, List II while denatured alcohol would fall under Entry 84, List I; c. Everything except denatured spirit is alcohol for human consumption because it has the potential to be consumed by humans. The process of denaturation is carried out only to make the alcohol sufficiently disagreeable for human consumption to avoid its misuse. ENA and rectified spirit may therefore be for human consumpt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 8 of List II. Since Entry 8 of List II is exhaustive and is not subject to any other entry in List I or List III, it cannot be transgressed by a law made by Parliament. 32. Relying on the State of Madras v. Gannon Dunkerley,62 Mr Datar argued that to understand the meaning of 'intoxicating liquors', which has not been defined in the Constitution, the Court may identify if the expression is nomen juris and adopt the meaning which the word has obtained over a passage of time. The British law i.e. the Spirits Act 1880 includes denatured alcohol. Similarly, this Court in India Mica (supra) and FN Balsara (supra) held that intoxicating liquor includes denatured spirits. Mr Datar also presented a list of legislation enacted at around the same time which included denatured alcohol in the same category as liquor. Mr Datar relied on the judgment of this Court in SIEL Ltd v. Union of India63 to argue that the subjects enumerated in Entry 33, List III are excluded from Entry 52, List I. Lastly, he urged that since Section 18G of the IDRA does not specify that it extends to 'production', even the issuance of a notified order would not result in the occupation of the field by the Union with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed at separately. Entry 52 of List I and Entry 33 of List III are a family of entries which are interconnected. Entry 52 of List I can also include and touch upon all matters relating to an industry that is brought under the control of the Union. These matters can be production, trade, commerce, supply and distribution, etc.; b. Entry 52 of List I is a special entry uncontrolled by any other entry including Entry 8 of List II. It envisages the possibility of uniform control at the federal level of any declared industry by removing it from the individual jurisdiction of the States. Such uniform control serves the purpose of subserving the common good, equitable distribution, fair prices, utility of the products of an industry for serving the interests of all the States, etc.; c. To the extent that Parliament legislates with respect to an industry, the powers of the States under Entries 26 and 27 of List II are denuded. Similarly, the powers of the States under Entry 33 of List III are denuded if Parliament has occupied the field. Merely because a notified order is not issued would not leave the subject to be legislated upon by the States. This is because the lack of regulation o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and non-potable purposes. 37. Mr Tushar Mehta, learned Solicitor General of India, argued that the adjudication on the interplay of Sections 2 and 18G of the IDRA with Entry 52 of List I and Entry 33 of List III will have a bearing on other legislation and therefore the ruling in this case may not be restricted to the industry of alcohol. The division of legislative powers has undergone four stages: (a) the devolution of powers to the Federal legislature and the Provincial legislatures under the Devolution Rules, Government of India Act 1919;65 (b) the division of subjects between the Centre and the Provinces under the 1935 Act; (c) the draft Constitution which was placed before the Constituent Assembly; and (d) the entries as they were finally adopted in the Constitution. The Solicitor General submitted that : a. Some industries have always been considered as necessarily under Union control. This may be because it is in national interest, requires uniform regulation throughout the country, or when the industry or its products are sought to be equitably distributed. Entry 52 of List I is in furtherance of the federal principle; b. Entry 20 of the Central Subject List in the D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trade and commerce, production, supply and distribution which led to the introduction of a concurrent list entry which is identifiable as Entry 33 of List III; g. The power of taxation over potable alcohol has always been with the States and the power of taxation over non-potable alcohol has always been with the Union. This is borne out by the evolution of Entry 84 of List I and Entry 52 of List II of the Seventh Schedule to the Constitution. The control and the taxing power were cumulatively given to the provinces under Entry 16 of the provincial subject list of the Devolution Rules under the 1919 Act. Under the 1935 Act, Entry 45 of List I specifically excluded 'alcoholic liquor for human consumption' from the domain of the Union and correspondingly included it under the State list as Entry 40 of List II; h. The term 'intoxicating liquors' in Entry 8 of List II means a beverage which has the effect of intoxication upon consumption. The term is not used elsewhere in the Seventh Schedule and instead the term 'alcoholic liquor for human consumption' is used in taxing entries. The terminological variation is because the incidence of tax is relevant in a taxing entry. Accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re a water-free solvent.69 40. 'Industrial alcohol' is a common term that is used to denote the alcohol that is used in industries. As indicated above, all the above three variants of ethanol are used in various industrial preparations. While ENA is usually used for the preparation of alcoholic beverages, rectified spirit is also used to prepare certain alcoholic beverages. Denaturation is a process by which ethanol is deliberately made undrinkable by adding chemicals known as 'denaturants' to make it poisonous or foul smelling and unsuited for ingestion by humans. Denaturants can be added to any of the three forms of ethanol (ENA, rectified spirit and absolute alcohol). Denatured alcohol is also further classified into 'Completely Denatured Alcohol' and 'Specially Denatured Alcohol'. Both these formulations contain denaturants making it unconsumable. However, in completely denatured alcohol, the denaturants cannot be easily removed while in 'specially denatured alcohol', they can be easily removed.70 In view of this complexity, where the materials for the preparation of potable alcohol are also used for the preparation of other products, a simplistic classification of 'potable' a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itory of India which is not included in a State. This power includes the power of Parliament to make laws with respect to entries enumerated in the State list, for Union Territories. 44. The federal balance of the distribution of legislative powers between the Union and the States rests on the interpretation of the phrase "notwithstanding" in Clause (1) of Article 246 and "subject to" in Clause (3) of Article 246. It is more than clear that the phrases provide predominance to Parliament over State Legislatures. The federal balance lies not on the recognition that the Constitution grants Parliament predominant legislative power but on the identification of the scope of such predominance. The scope of the non-obstante clause in Article 246(1) and the subjugation clause in Article 246(3) must not be interpreted in isolation but along with the substantive provisions of the clauses. Clause (1) of Article 246 grants Parliament the "exclusive power" to enact laws with respect to matters in List I. Similarly, Clause (3) of Article 246 grants the Legislature of States, the "exclusive power" to enact laws with respect to matters in List II. On a holistic interpretation of the provisions, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Parliament and State Legislatures emanates from Articles 245 and 246 of the Constitution. These provisions in the Constitution have been borrowed from Sections 99 and 100 of the Government of India Act 193583 with necessary modifications. The demarcation of legislative fields is based on a deliberate design as well as on the principles of federalism. Matters requiring coordination between different regions of the country or of national importance have been placed in the field of Parliament. Matters requiring localized focus and limited or no coordination between States have been placed in the State List. Fields of legislation which may require either uniform legislation for the entire nation or context and region-specific accommodation, depending on the circumstance, are placed in the Concurrent List. Moreover, the three lists make a clear distinction between general entries and taxation entries. The power of taxation cannot be derived from a general entry.84 The entries in the legislative lists do not cast an obligation to legislate or to legislate in a particular manner. Within the confines of an entry, the legislature exercises plenary power subject to the provisions of the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en two or more things or fields partially intersect. However, a conflict occurs when two or more entries operate in the exactly same field. Courts while dealing with an overlap of legislative entries must endeavour to diminish the overlap and not enhance it by including it in the field of conflict. The federal supremacy accorded to Parliament ticks in at the stage of 'conflict'. 51. The legislative entries must be given a wide meaning. All incidental and ancillary matters which can be fairly and reasonably comprehended must be brought within them87. However, if there is an overlap between two entries the Court must endeavour to interpret the entries harmoniously. While interpreting the entries harmoniously, it must be ensured that no entry is rendered redundant. This principle of construction applies equally to entries within the same List and entries within different lists.88 The principle of parliamentary supremacy must be applied only when the attempted reconciliation by the above methods of interpretation fails. iii. The field covered by Entry 52 of List I and Entry 8 of List II 52. Entry 8 of List II reads as follows: "Intoxicating liquors, that is to say, the production ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d narcotic drugs, that is to say, the production, manufacture, possession, transport, purchase and sale of intoxicating liquors, opium and other narcotic drugs." The issue was whether the Provincial Government had the competence to issue a notification prohibiting the possession of intoxicating liquor. The Federal Court held that the Provincial Government had the competence to prohibit though Entry 31 does not expressly grant the power to 'prohibit'. The Court noted that the words that follow the phrase 'that is to say' were explanatory or illustrative and not words of either amplification or limitation. However, in other judgments dealing with taxing provisions, this Court has held that the expression 'that is to say' is employed to exhaustively enumerate.98 While interpreting the expression 'that is to say', it must not be lost that it features in the legislative list which must be interpreted widely and to include all ancillary items. The interpretation of taxing statutes (which must be construed strictly) and legislative entries in the Seventh Schedule(which are required to be construed widely and liberally) cannot be the same. This was noticed by the Constitution Bench in Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts of the industries covered by Entry 24 of List II. Parliament has the competence to legislate on any 'industry' provided that it satisfies the condition stipulated in Entry 52 of List I (control by the Union being declared by a law of Parliament to be in the public interest). The necessary corollary of the enactment of the law under Entry 52 is that the products of the industry are shifted to the Concurrent list from the State List. 57. The scope of Entry 8 must be interpreted in this background. If Entry 8 is a product-based Entry, it will only cover the consumable end-product. However, if it is an industry-based Entry, it would cover the production of the product as well.105 Entries 24, 26 and 27 of List II are general entries relating to industry and the products of the industries. A distinction between industry and product is made in List II to give effect to the legislative scheme by which certain industries may be controlled by the Union under Entry 52 of List I but products of those industries which are placed in the Concurrent list under Entry 33. To give effect to this unique demarcation, it was necessary to separate the entries relating to industries and products in L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ison may be drawn to Entry 54 of List I and Entry 23 of List II to cull out the scope of Entry 52 of List I. Entry 23 of List II deals with the "regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union." Entry 54 of List I deals with the "regulation of mines and mineral development to the extent to which such regulation and development under the control of Union is declared by Parliament by law to be expedient in public interest." The expression 'to the extent to which' is absent in Entry 52 of List I. In Mineral Area Development Authority v. M/s Steel Authority of India106, a nine-Judge Bench of this Court dealt with the scope of Entry 52 of List I and in particular, the purport of the expression "to the extent to which". One of the contentions before the nine-Judge Bench was that the State Legislature does not have any power under Entry 23 of List II because the Mines and Minerals (Development and Regulation) Act 1957107 is a complete code that occupies the entire field relating to regulation of mines and mineral development. Rejecting the argument, the majority held that the words "t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gislation pursuant to declaration to that extent denude the power of State Legislature to legislate under Entry 24 List II." 62. The opinion of Justice D A Desai referred to the judgments of this Court in Baijnath Kedia v. State of Bihar110 and State of Haryana v. Chanan Mal111 "on an identical Entry 54, List I."112 It was also argued that Section 2 of IDRA113, unlike Section 2 of MMDRA114 does not provide that the Union shall take control "to the extent herewith provided", and thus, IDRA takes full control over the scheduled industries. Rejecting the argument, Justice D A Desai noted that the "words of limitation on the power to make declaration are 'by law'".115 Justice R S Pathak, as the learned Chief Justice then was, (writing for himself and Justice Koshal) observed that he would refrain from expressing any opinion on this issue and that the challenge to the validity of the impugned enactment could be disposed of without a reference to Entries 52 of List I and 24 of List II.116 63. In ITC (supra), another Constitution Bench briefly dealt with this issue. It was argued that this Court in Ishwari Khetan (supra) equated Entry 52 of List I with Entry 54 of List II. Justice Y K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 phrase 'control'. The Entry does not read as "industries, declared by Parliament by law to be expedient in the public interest." The Entry states "Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest." The law enacted by Parliament must not be an abstract declaration but must specify the extent of control that is necessary to be taken in public interest. The State Legislature will have the competence to legislate with respect to the field which is not the subject matter of control. The legislative competence of the State Legislature is only denuded to the extent of the 'control' by the Union declared by the law of Parliament to be expedient in the public interest. c. Reconciling the potential overlap between Entry 52 of List I and Entry 8 of List II 66. Having discerned the scope of Entry 52 of List I, it next needs to be considered if Entry 52 of List I and Entry 8 of List II overlap, and if they overlap, whether they can be reconciled. 67. At this juncture, the decisions of this Court that have dealt wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure' of intoxicating liquor. Including the production and manufacture of liquor in Entry 24 of List II (and as a consequence in Entry 52 of List I), would amount deleting the words "production and manufacture" in Entry 8; b. Entry 24 is a general entry and Entry 8 is a specific entry. On the application of the principle of generalia specialibus non derogant (general things do not derogate from specific things), the industry of intoxicating liquor will not fall under the general entry (Entry 24) but the special entry (Entry 8); and c. Entry 52 only governs Entry 24 and not Entry 8. Thus, the industry of intoxicating liquor cannot be taking over by Parliament under Entry 52.122 Referring to the decision in Calcutta Gas Company (supra), the three-Judge Bench observed that Entry 8 is more specific as compared to Entry 24 because the former expressly refers to 'production and manufacture', and thus, it is all the more clear that the production of liquor cannot be covered by Entry 52.123 69. In Calcutta Gas Company (supra) and McDowell (supra), this Court adopted the following established principles of interpretation to resolve the overlap between legislative entries: (a) generalia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 control is necessary in public interest). Similarly, Entry 8 of List II, when read independently also includes, inter alia, the production and manufacture of intoxicating liquor which is included within the meaning of industry. Thus, Entry 52 of List I and Entry 8 of List II overlap on the aspect of 'industry' of intoxicating liquor; c. Entry 8 of List II is not subject to Entry 52 of List I. Thus, the State Legislature has the exclusive competence to enact a law on the field in Entry 8. The Court must distinguish between entries that are expressly subject to entries in the Union List and entries that are not. When one entry is not subject to the other, the Court must harmonise the overlap of the entries; d. The only way to reconcile the entries is either to exclude the industry of intoxicating entry from Entry 52 of List I or Entry 8 of List II. The Court while reconciling the provisions, must ensure that neither of the entries is rendered redundant. The principle of generalia specialibus non derogant is used by courts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 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 by adopting the interpretation accorded to Entry 8 of List II by the appellants. It argues that 'intoxicating liquors' means beverages which are per se meant for human consumption for the purpose of intoxication without dilution or modification by any process. The Union also relies on the legal history of the division of legislative fields between the Union and the States in support of its argument that only Parliament is competent to legislate with regard to denatured alcohol. a. Precedent on the interpretation of 'intoxicating liquor': exploring FN Balsara and Southern Pharmaceuticals 75. The respondents have relied on the interpretation of the phrase 'intoxicating liquor' in the judgment of the Bombay High Court in FN Balsara v. State of Bombay127. The petitioners have strongly relied on the decision of this Court in FN Balsara (supra) which overturned the judgment of the Bombay High Court. 76. The petitioner in Balsara (supra) had one bottle of whisky, one bottle of brandy, one bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 submission that the State Legislature can legislate on all liquids containing alcohol. The High Court, upon an analysis of judgments noted that they only hold that 'intoxicating liquor' could cover drinks that contain a small percentage of alcohol, even if it does not produce an intoxicating effect. The Court further noted that the judgments of the US Courts hold that the State cannot regulate the legitimate use of non-beverage, and medicinal and toilet preparations containing alcohol, but only regulate their use for noxious purposes. Upon the analysis of the decisions, the High Court held that the State: (a) has the competence to legislate on alcoholic liquids which are not normally consumed as drinks; (b) cannot legislate on the "legitimate" use of alcoholic preparations which are not beverages; and (c) cannot legislate on the use of medicinal and toilet preparations containing alcohol. 77. The appeals against the judgment of the High Court were allowed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous 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. Neither of the decisions limited the scope of the phrase to the common parlance meaning of 'intoxicating beverages'. Both the decisions held that the entry covered liquor which may not produce 'intoxication' but which may be used for noxious purposes. The difference is one of degree. While the High Court held that all liquids containing alcohol will not be covered by Entry 31 of List II, this Court held otherwise. However, the conclusion of this Court on the scope of the phrase cannot be read detached from observations that a wider definition of intoxicating liquor is necessary to cover other products which 'may be used as substitutes for intoxicating drinks'. 80. In Southern Pharmaceuticals and Chemical v. State of Kerala142, the appellants challenged the constitutional validity of the provisions of the Abkari Act, as amended by the Abkari (Amendment) Act 1967 and Kerala Rectified Spirit Rules 1972 which regulated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 be valid if the levy has a reasonable relationship with the services rendered by the Government.147 82. It is clear from the analysis of the above judgments that the meaning of the phrase 'intoxicating liquor' in Entry 8 of List II has been expanded beyond the narrow definition of alcoholic beverages that produce an 'intoxicating effect' upon consumption. Liquids which contain alcohol and which can possibly be used (or misused) as intoxicating liquor have been included within the meaning of the phrase. 83. We will test this proposition in the subsequent sections. In our opinion, there are four possible approaches that we can adopt to determine the meaning of the expression 'intoxicating liquor'. The first is through the identification of the 'legislative meaning' of the phrase intoxicating liquor; the second is through legislative history; the third, is the common parlance test, and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 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 (b) the legal import of the word must be practically unanimous. Additionally, we also are of the view that the legislative meaning interpretation should be adopted only when the deviation from the popular meaning of the phrase is not too wide. The legislative meaning cannot be used to artificially narrow legislative entries. We also deem it necessary to note that we must be cognizant that the standard of 'legislative meaning' is employed to identify the 'intent' of the framers of the Constitution and belongs to the originalist school of thought, which has been consistently opposed by this Court over the years.153 For these reasons, the principle of interpretation elucidated in Gannon Dunkerley (supra) must be used cautiously by Courts. 86. Let us now proceed to determine if the phrase 'intoxicating liquor': (a) has a definite and precise meaning in law; (b) is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 statute which applied to the United Kingdom. The definition of 'liquor' in pre-constitutional statutes as liquids containing alcohol cannot be transposed to interpret the legislative entry. The phrase used in the legislative entry is 'intoxicating liquor'. The definition of one part of the expression in statutes cannot be used to interpret expressions that are used to indicate a collective meaning, particularly when the common parlance definition starkly varies. The common parlance meaning of 'intoxicating liquor' means liquor which causes intoxication, that is, which causes someone to lose control. Thus, the threeprong test to identify if "Intoxicating Liquor" has acquired legislative meaning has not been satisfied. c. Evolution of the legislative lists on 'intoxicating liquor' 88. We proceed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es 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 liquors, opium and other narcotic drugs, but subject, as respects opium, to the provisions of List I and, as respects poisons and dangerous drugs, to the provisions of List III. ... 40. Duties of excise on the following goods manufactured or produced in the Province and countervailing 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; non-narcotic drugs; (c) medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this entry." ( emphasis supplied ) 92. The three categories which were excluded from duties of excise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rugs'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 including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry." (emphasis supplied) 95. Entry 51 of List II deals with duties of excise, inter alia, on alcoholic liquor: "51. Duties of excise on the following goods manufactured or produced in the State and countervailing 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 subparagraph (b) of this entry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' 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 liquor'186 100. Before we proceed to lay down our inferences upon a study of the evolution of legislative entries, we clarify that the issue before this Bench is squarely related to the interpretation of the expression 'intoxicating liquor'. The meaning of the expression 'alcoholic liquor for human consumption' and whether it can be read as 'alcoholic liquor fit for human consumption' is not before this Bench. 101. The Report of the Joint Committee does not explain why the expression 'alcoholic liquor' was substituted with the phrases 'liquor' in the regulatory entry and 'potabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 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 regulation of alcohol used in the production of other products since opium and narcotic drugs are also used as raw materials in the production of other products (like pain relivers) 105. Mr TT Krishnamachari moved an amendment to delete references to narcotic drugs and opium in Entry 40 of List II of the Draft Constitution 1948 (which correspondes to Entry 31 of List II of the 1935 Act). The amendment was adopted by the Assembly. Mr Krishnamachari submitted that it was necessary to delete references to opium and narcotic drugs because they were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quid 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 alcoholic beverages for human consumption which causes intoxication, that is, potable alcohol. 111. Entry 51 of List II refers to duties of excise on, inter alia, "alcoholic liquors for human consumption'. Article 47 which is placed in the Part on the Directive Principles of State Policy stipulates that the State shall endeavour to bring prohibition of the consumption of intoxicating drinks and drugs injurious to health, except for medicinal purposes. The provision lists this as one of the aspects of the duty o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 in the 1935 Act also regulated narcotic drugs and opium along with intoxicating liquor. References to narcotic drugs and opium were deleted to prevent its overlap with entries in the Concurrent list. As highlighted in the previous section, a common thread that runs through alcohol, narcotic drugs and opium is that they are products which can be noxiously used because they are also used as raw materials in the production of other products. It is clear from the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing 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 cover potable alcohol but alcohol which may be used noxiously also. Thus, the test to be adopted is not whether the alcohol could be converted and used for the preparation of alcoholic beverages but whether it could be mischievously used for its preparation or as a substitute. 115. It was also argued by the petitioners that the phrase 'intoxicating liquor' must be interpreted to mean liquid containing alcohol. The consequence of this interpretation would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mally 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 Balsara (supra). 118. This Court in Synthetics (7J) (supra) did not determine the meaning of the expressions 'intoxicating' or 'liquors' or 'intoxicating liquors' independently. It did not compare the difference in the language used to describe alcohol or liquor in different provisions of the Constitution to understand the significance of the difference. Only Article 47 was referred to in the following terms: "77. Article 47 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. 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 enacted in terms of Entry 52 of List I cannot render any entry of List II (including Entry 8) otiose. Thus, Parliament cannot take over the field covered by Entry 8. 122. In paragraph 86 of the judgment, this Court in Synthetics (7J) (supra) held that after the inclusion of the fermentation industry in the schedule to IDRA, the State only had legislative competence to: a. enact any legislation in the na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent 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 86(d) creates an inherent inconsistency within the judgment. We have overruled the interpretation in Synthetics (7J) (supra) on the scope of Entry 8 and the interaction between Entry 8 and Entry 52 of List. The phrase 'intoxicating liquor' in Entry 8 includes denatured alcohol. Thus, the State will have the competence to levy fees with respect to denatured alcohol, but for the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 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." (emphasi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 classification of alcohol into potable and non-potable (or industrial alcohol) is oversimplistic. Alcohol (such as ENA or rectified spirit) which is used to prepare potable alcohol is also used to prepare other products of the pharmaceutical industry. An interpretation that ENA or rectified spirit which is used in the preparation of pota ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. We have held above that Parliament under Entry 52 of List I does not have the legislative competence to enact a law taking control of the industry of intoxicating liquor. The State Legislatures will have control over the industry of 'intoxicating liquor'. Parliament could not have taken contro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 the provision. The mere possibility that a notified order may be issued could not lead to repugnancy. Such an order was an essential prerequisite for repugnancy to arise208. 134. The decision in Tika Ramji (supra) was relied upon by this Court in Calcutta Gas ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruling 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 the Union has occupied the field by Section 18G of IDRA.212 The questions referred by the three-Judge Bench in Lalta Prasad (supra) all relate to the issue of whether Section 18G of the IDRA occupies the field in Entry 33 of List ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 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 occurs in the legislative entries does not fall for determination in this reference; and k. The issue of whether Section 18G of the IDRA covers the field under Entry 33 of List III does not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 105 d. Synthetics and Chemicals (2J) 107 e. Bileshwar Khand Udyog 109 f. Shree Krishna Gyanoday Sugar Ltd 110 g. Bihar Distillery 111 h. Vam Organic I 113 i. Vam Organic II 114 11. Further Analysis 115 12. Meaning of "intoxicating liquors" 119 13. A Historical Perspective 122 14. Constituent Assembly Debates 124 15. Analysis of relevant Entries in the three Lists 138 a. Ishwari Khetan 139 b. Meaning of "subject to" 147 c. Hingir Rampur 148 d. Shri Krishna 148 e. South India Corporation 149 f. Ashok Leyland Ltd. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Appeal No.151 of 2007 Etc. Page 7 of 241 the judgment of the seven-Judge Bench of this Court in Synthetics and Chemicals (7J). The said judgment authored by Sabyasachi Mukharji, J. (as His Lordship then was) held that the scope of the expression "intoxicating liquors" in Entry 8 - List II did not extend to "industrial alcohol" and regulation of the same by State Legislature is impermissible in law having regard to the constitutional framework, particularly the relevant Entries of Lists I and II of the Seventh Schedule to the Constitution of India. The said dictum of the seven-Judge Bench was doubted by a three-Judge Bench of this Court in State of UP vs. M/s Lalta Prasad Vaish vide order dated 25.10.2007 and 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. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rliament 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. 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; 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); 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P vs. McDowell & Co., (1996) 3 SCC 709 ("McDowell"); Bihar Distillery vs. Union of India, (1997) 2 SCC 727 ("Bihar Distillery"); Vam Organic Chemicals Ltd. vs. State of U.P., (1997) 2 SCC 715, ("Vam Organic I"); and State of UP vs. Vam Organic Chemicals Ltd., (2004) 1 SCC 225 ("Vam Organic II"), amongst others, have been discussed. Submissions: 4. As the learned Chief Justice has recorded the submissions of the respective parties in detail, I need not be repetitive except highlighting the submissions of the learned senior counsel Sri Rakesh Dwivedi, Sri Datar and Sri Jaideep Gupta and other counsel for the appellants. The main contention of the appellants is that the States have jurisdiction over "industrial alcohol" and therefore the judgment of this Court in Synthetics and Chemicals (7J) is incorrect. 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 cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l is excluded from the scope of the term "intoxicating liquors" in Entry 8 - List II and is covered under Entry 24 - List II. Further, unless a notified order under Section 18G of the IDRA is issued, the Parliament cannot occupy the field under Entry 33 - List III merely on the strength of the said provision being brought on the statute book. 4.3 On the other hand, Sri R. Venkataramani, learned Attorney General, leading the arguments for the Union of India and other respondents contended that Entry 52 - List I and Entry 33 - List III are interrelated as they touch upon matters relating to a scheduled industry under the provisions of the IDRA, whose control is with the Union. It was contended that Entry 52 - List I is provided in order to ensure a uniform control and development of an industry throughout the length and breadth of the country. This 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) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toxicating liquors' in Entry 8 of List II of the Seventh Schedule to the Constitution includes alcohol other than potable alcohol; and c. Whether a notified order under Section 18G of the IDRA is necessary for Parliament to occupy the field under Entry 33 of List III of the Seventh Schedule to the Constitution." Relevant Constitutional Framework: 6. Article 265 of the Constitution mandates that no tax shall be levied or collected except by authority of law. Article 366 is a definition clause and it states that in the Constitution, unless the context otherwise requires, the expressions mentioned therein have the meanings thereby respectively assigned to them. For the purpose of this case, Article 366(12) and (28) are relevant and the same read as under: "Article 366. Definitions.- In this Constitution, unless the context otherwise requires, the following expressions have the meanings hereby 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtent of the repugnancy, be void. (2) 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: Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State." 6.2 With regard to the allocation of subjects under the three Lists, namely, List I - Union List; List II - State List and List III - Concurrent List, it may be useful to refer to the Devolution Rules drawn under the Government of India Act, 1919 and 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 dist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plied to determine to which Entry, a piece of legislation could be related to. In order to examine the true character of an enactment or a provision thereof, due regard must be had to the enactment as a whole and to its scope and object. It is said that the question of invasion into another legislative territory has to be determined by substance and not by degree. (ii) In case of any conflict between Entries in List I and List II, the power of Parliament to legislate under List I will supersede when, on an interpretation, the two powers cannot be reconciled. But if a legislation in pith and substance squarely falls within any of the Entries of List II, the State Legislature's competence cannot be questioned on the ground that the field is covered by the Union list or the Concurrent list vide Prafulla Kumar Mukherjee vs. Bank of Commerce Limited, Khulna, AIR 1947 P.C. 60 ("Prafulla Kumar Mukherjee"). According to the pith and substance doctrine, if a 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 Balsa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 On a close perusal of the Entries in the three Lists, it is discerned that the Constitution has divided the topics of legislation into the following three broad categories: (i) Entries enabling laws to be made; (ii) Entries enabling taxes to be imposed; and (iii) Entries enabling fees and stamp duties to be collected. 6.7 Thus, the Entries on levy of taxes are specifically mentioned. Therefore, as such, there cannot be a conflict of taxation power of the Union and the State. In substance, the taxing power can be derived only from a specific taxing Entry in an appropriate List. Such a power has to be determined by the nature of the tax and not the measure or machinery set up by the statute. In this context, reliance could be placed on MPV Sundararamier vs. State of Andhra Pradesh, AIR 1958 SC 468 ("MPV Sundararamier"), wherein at paragraph 51 it was observed as under: "51. In List I Entries 1 to 81 mention the several matters over which Parliament has authority to legislate. 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 g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d narcotics, but including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry. List - II 8. Intoxicating liquors, that is to say, the production, manufacture, possession, transport, purchase and sale of intoxicating liquors. xxx 24. Industries subject to the provisions of Entries 7 and 52 of List I. xxx 26. Trade and commerce within the State subject to the provisions of entry 33 of List III. 27. Production, supply and distribution of goods subject to the provisions of entry 33 of List III. xxx 51. Duties of excise on the following goods manufactured or produced in the State and countervailing 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 subparagraph (b) of this entry. List - III 33. Trade and commerce in, and the production, supply and distribution of,- (a) the products of any industry where the control of such indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of the licence or permission, as the case may be, fall; (b) any article which bears a mark as defined in the Trade Marks Act, 1940 (5 of 1940), or which is the subject of a patent, if at the date of registration or issue of the licence or permission, as the case may be, the industrial undertaking was not manufacturing or producing such article bearing that mark or which is the subject of that patent; (e) "notified order" means an order notified in the Official Gazette; xxx (g) "prescribed" means prescribed by rules made under this Act; (h) "Schedule" means a Schedule to this Act; (i) "scheduled industry" means any of the industries specified in the First Schedule; xxx (k) words and expressions used herein but not defined in this Act and defined in the Companies Act, 1956 (1 of 1956), have the meanings respectively assigned to them in that Act." 7.2 Chapter II of the Act deals with the Central Advisory Council and Development Councils while Chapter III speaks of regulation of scheduled industries. The headings of Sections 10 to 18 are noted within Chapter III. The said provisions deal with, inter alia, registration of existing industries, issuance of lic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsons engaged in the distribution and trade and commerce in any such article or class thereof to mark the articles exposed or intended for sale with the sale price or to exhibit at some easily accessible place on the premises the price-lists of articles held for sale and also to similarly exhibit on the first day of every month, or at such other time as may be prescribed, a statement of the total quantities of any such articles in stock; (g) for collecting any information or statistics with a view to regulating or prohibiting any of the aforesaid matters; and (h) for any incidental or supplementary matters, including, in particular, the grant or issue of licences, permits or other documents and the 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 c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry, but also afford gainful employment to millions of people." 7.5 Section 29E was inserted with effect from 14.05.2016 by Act 27 of 2016. As already noted, Item 26 of the First Schedule deals with "Fermentation Industries" and after amendment by Civil Appeal No.151 of 2007 Etc. Page 37 of 241 Act 27 of 2016 with retrospective effect from 08.05.1952, "Fermentation Industries" have been clarified as "other than potable alcohol". Therefore, alcohol and other products of "Fermentation Industries" would refer to products which are "other than potable alcohol". Article 47: Directive Principle of State Policy: 8. Since we are trying to ascertain the true meaning of "intoxicating liquors" in Entry 8 - List II, Article 47 of the Constitution of India, which is a Directive Principle of the State Policy, is relevant as the said Article deals, inter alia, with intoxicating drinks. The same reads as under: "47. Duty of the State to raise the level of nutrition and the standard of living and to improve public health The State shall regard the raising of the level of nutrition and the standard of living of its people and the improvement of public health as among its primary duties a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the general public and thereby possibly create a monopoly, is also permissible in law. b) In State of Assam vs. Sristikar Dowerah, AIR 1957 SC 414 ("Sristikar Dowerah"), it was observed as under: "no person has any absolute right to sell liquor and that the purpose of the Act and the rules is to control and restrict the consumption of intoxicating liquors, such control and restriction being obviously necessary for the preservation of public health and morals, and to raise revenue." The above observation is in line with Article 47 of the Constitution of India which is a Directive Principle. c) The constitutional validity of the Bombay Prohibition Act, 1949 was challenged in FN Balsara. One of the arguments raised was that the said Act could be justified under Entry I -List II which relates to public order. This was by placing reliance on a tendency in Europe and America with regard to alcoholism as a menace to public order. However, the said submission was not pursued further before this Court as there were other express provisions under the pertinent Entry which dealt with "intoxicating liquors". The short question considered was whether the Bombay Prohibition A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich affected the possession, selling and consumption of any medicinal and toilet preparations and commendation of any intoxicant or hemp were invalid. d) In Nagendra Nath vs. Commissioner of Hills Division, AIR 1958 SC 398 ("Nagendra Nath"), it was reiterated that there is no inherent right in a citizen to sell liquor and that the control and restriction over the consumption of "intoxicating liquors" was necessary for the preservation of public health and morals and to raise revenue. e) The question, whether Section 43 of the Bengal Excise Act, 1909, under which the licence of a liquor contractor was withdrawn, violated Articles 14 and 19 of the Constitution of India was considered in Amar Chandra Chakraborty vs. Collector of Excise, Government of Tripura, AIR 1972 SC 1863 ("Amar Chandra Chakraborty"). It was observed that in view of the injurious effect of excessive consumption of liquor on health, the trade or business must be treated as a class by itself and it cannot be treated on par with other trades while testing the matter from the angle of Article 14 of the Constitution. f) In State of Orissa vs. Harinarayan Jaiswal, AIR 1972 SC 1816 ("Harinarayan Jaiswal"), it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form of activity in relation to intoxicants, its manufacture, storage, export, import, sale and possession. In all their manifestations, these rights are vested in the State and indeed without such vesting there can be no effective regulation of various forms of activities in relation to intoxicants. Therefore, the States' right to regulate activities in relation to intoxicants to the extent of prohibiting would imply that even when permission to deal with intoxicants is granted, the same can be regulated. This is because the rights in regard to intoxicants belong to the State and it is open to the Government to part with those rights for a consideration. The power of the Government to charge a price for parting with its rights and not the mode of fixing that price is what constitutes the essence of the matter. It was also held that neither does the label affixed to the price determine the true nature of the charge levied by the Government nor its right to levy the same. By use of the expression "licence fee" or "fixed fee", what is meant is the price or consideration which the Government charges to the licencees for parting with its privileges and granting them the licences. That ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lised societies. It does not entitle citizens to carry on trade or business in activities which are immoral and criminal and in articles or goods which are obnoxious and injurious to health, safety and welfare of the general public, i.e., res extra commercium, (outside commerce). There cannot be business in crime. (c) Potable liquor as a beverage is an intoxicating and depressant drink which is dangerous and injurious to health and is, therefore, an article which is res extra commercium being inherently harmful. A citizen has, therefore, no fundamental right to do trade or business in liquor. Hence the trade or business in liquor can be completely prohibited. (d) Article 47 of the Constitution considers intoxicating drinks and drugs as injurious to health and impeding the raising of level of nutrition and the standard of living of the people and improvement of the public health. It, therefore, ordains the State to bring about prohibition of the consumption of intoxicating drinks which obviously include liquor, except for medicinal purposes. Article 47 is one of the directive principles which is fundamental in the governance of the country. The State has, therefore, the power to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, sale or income is legitimate or illegitimate, does not make the State a party to the said activities. The power of the State to raise revenue by levying taxes and fees should not be confused with the power of the State to prohibit or regulate the trade or business in question. The State exercises its two different powers on such occasions. Hence the mere fact that the State levies taxes and fees on trade or business in liquor or income derived from it, does not make the right to carry on trade or business in liquor a fundamental right, or even a legal right when such trade or business is completely prohibited. (k) The State cannot prohibit trade or business in medicinal and toilet preparations containing liquor or alcohol. The State can, however, under Article 19(6) place reasonable restrictions on the right to trade or business in the same in the interests of general public. (l) Likewise, the State cannot prohibit trade or business in industrial alcohol which is not used as a beverage but used legitimately for industrial purposes. The State, however, can place reasonable restrictions on the said trade or business in the interests of the general public under Article 19(6) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itself with the taxing power of the States to impose and levy excise duty on "industrial alcohol" and/or imposts such as vend fees. "Power Alcohol" was defined as ethyl alcohol containing not less than 95.5 per cent volume of ethanol measured at 60°F, corresponding to 74.4 over proof strength. That rectified spirit was ethyl alcohol or ethanol with 96 per cent alcohol. On dehydration, ethyl alcohol with 99.5 per cent volume of ethanol is produced. 9.1.4 This Court noted that on 08.05.1952, the Parliament enforced the IDRA which contains, inter alia, Section 18G which was inserted w.e.f. 01.10.1953, whereby the Central Government was empowered for securing equitable distribution and availability at fair prices of any article or class of articles relatable to any scheduled industry to provide for regulating the supply and distribution thereof, and trade and commerce therein by a notified order. The notified order was also to provide for controlling the prices at which such article or class of articles could be bought or sold. The said Act was amended in 1956. Item 26 was inserted in the First Schedule to the said Act and empowered the Central Government to control the "Fermentat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "intoxicating liquors" under Entry 8 - List II. It being a general Entry, will not comprehend a power of taxation but will comprehend a power to levy fee read with Entry 66 - List II. 9.1.7 According to the Union of India, with regard to industries the control of which by the Union is declared by Parliament by law to be expedient in public interest, Parliament will have exclusive legislative competence vide Entry 52 - List I. This power includes the power to declare by Parliament that control by the Union of industries relating to all types of alcohol is expedient in public interest. Once Parliament makes such a declaration, the State Legislature will be denuded of its power under Entry 24 - List II on the aspect "industry" with respect to all subject matters. 9.1.8 It was also contended that the power to collect the lump sum amount by way of auction by any right or otherwise conferring the right to sell alcohol is neither a power to levy tax nor a power to levy fee but it will fall within the legislative competence of the State Legislature under Entry 8 - List II. But this power will extend only to alcohol for human consumption. Also, there can be a complete prohibition with re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sumption". It was contended that Entry 84 - List I expressly excludes alcoholic liquors for human consumption and therefore, the residuary Entry 97 - List I will not operate as against its own legislative interest. The aforesaid submissions were made on the assumption that "industrial liquor" or "ethyl alcohol" is fit for human consumption. 9.1.12 This Court stated that the expression must be understood in its common and normal sense. "Industrial alcohol" as it is, is incapable of being consumed by a normal human being. The expression 'consumption' must also be understood in the sense of direct physical intake by human beings in this context. That utilisation in some form or the other is consumption for the benefit of human beings if "industrial alcohol" is utilised for production of rubber tyres, etc. It was held that the utilisation of those tyres in the vehicles used by human beings cannot, in the context in which the expression has been used in the Constitution, be understood to mean that alcohol has been for human consumption. 9.1.13 This Court observed that when the framers of the Constitution used the expression "alcoholic liquors for human consumption", they meant and sti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material. Some of these industries themselves (i) manufacture alcohol as they have their own distilleries and from their distilleries through pipelines it goes to their industrial units where this is used as a raw material (ii) whereas some are industries which purchase alcohol or denatured spirit on being allotted by the Government. 9.1.15 On a comparison of the language of Entry 84 - List I and Entry 51 - List II, it was observed by Oza, J. that the powers of taxation on alcoholic liquors have been based on the way in which they are used, as admittedly alcoholic liquors is a very wide term and may include variety of types of alcoholic liquors but the Constitution-makers distributed them into two heads: (a) for human consumption (b) other than for human consumption 9.1.16 Alcoholic liquors which are for human consumption were put in Entry 51 - List II authorising the State Legislature to levy tax on them whereas alcoholic liquors other than for human consumption have been left to the Central Legislature under Entry 84 - List I for levy of duty of excise. This scheme of the Entries in two Lists clearly indicates the line of demarcation for purposes of taxation of alcoholic li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are made for human consumption would not include alcoholic liquors not made for human consumption or "industrial alcohol". Synthetics and Chemicals (2J): 9.2 In State of U.P. vs. Synthetics and Chemicals Ltd., (1991) 4 SCC 139 ("Synthetics and Chemicals (2J)"), a two- Judge Bench of this Court (speaking through Sahai J. who also wrote the concurring judgment along with Thommen, J.) observed that the High Court relied upon the observations in paragraph 86 of the judgment of the Constitution Bench in Synthetics and Chemicals (7J), namely, "sales tax cannot be charged on "industrial alcohol" and, therefore, held that due to operation of the Ethyl Alcohol (Price Control) Orders, sales tax cannot be charged by the State on "industrial alcohol" and struck down the levy. 9.2.1 In Synthetics and Chemicals (2J), it was categorically argued by the learned Advocate General appearing for the State of Uttar Pradesh that the reference to "sales tax" in the judgment of this Court between the same parties (before seven-Judge Bench) was accidental and did not arise from the judgment. This was because the levy of sales tax was not in question at any stage of the arguments nor was the question co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that judgment was merely accidental or per incuriam and therefore, had no effect. 9.2.5 In the earlier litigation of Synthetics and Chemicals (7J), the question was whether the State Legislature could levy vend fee or excise duty on "industrial alcohol". The seven-Judge Bench answered in the negative as "industrial alcohol" being unfit for human consumption, the State Legislature was incompetent to levy any duty of excise either under Entry 51 or Entry 8 - List II of the Seventh Schedule. The judgment of this Court in Synthetics and Chemicals (7J) has been considered in later decisions and they could be adverted to at this stage itself. Bileshwar Khand Udyog: 9.3 In Shri Bileshwar Khand Udyog Khedut Sahakari Mandali Ltd. vs. State of Gujarat, (1992) 2 SCC 42 ("Bileshwar Khand Udyog"), it was observed that Synthetics and Chemicals (7J) finally brought down the curtain in respect of "industrial alcohol" by taking it out of the purview of both Entry 8 and Entry 51 - List II and the competency of the State to frame any legislation to levy any tax or duty was excluded. But by that a provision enacted by the State for supervision which is squarely covered under Entry 33 - List III w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holic liquors for human consumption", meant, and the expression still means, that liquor which, as it is, is consumable in the sense that it is capable of being taken by human beings as such as a beverage or drink. Alcoholic or intoxicating liquors had to be understood as they were, not what they were capable of or able to become. Entry 51 of List II was the counterpart of Entry 84 of List I. It authorised the State to impose duties of excise on alcoholic liquors for human consumption manufactured or produced in the State. It was clear that all duties of excise save and except the items specifically excepted in Entry 84 of List I were generally within the taxing power of the Central Legislature. The State Legislature had limited power to impose excise duties. That power was circumscribed under Entry 51 of List II. It had to be borne in mind that, by common standards, ethyl alcohol (which had 95 per cent strength) was an industrial alcohol and was not fit for human consumption. The ISI specifications had divided ethyl alcohol (as known in the trade) into several kinds of alcohol. Beverages and industrial alcohols were clearly and differently treated. Rectified spirit for industri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he State of Uttar Pradesh. Rest of the appeals were dismissed. Shree Krishna Gyanoday Sugar Ltd.: 9.7 In Shree Krishna Gyanoday Sugar Ltd. vs. State of Bihar, (1996) 10 SCC 11, ("Shree Krishna Gyanoday Sugar Ltd."), the question was whether Rule 9 of the Bihar & Orissa Excise Rules, 1990, framed under the Bihar and Orissa Excise Act, 1915, was ultra vires the said Act. In the alternative, the question was whether the said Rule covered the appellants' distilleries which were manufacturing not only denatured spirit but also potable liquor. 9.7.1 It was contended that the distilleries of the appellants therein were having composite licences to manufacture not only denatured spirit and other spirits for industrial use but were also manufacturing potable spirit or country liquor and that for these distilleries the State had no power or jurisdiction to invoke Rule 9 of the Rules. The High Court repelled the contention of the appellants therein. It was held that Rule 9 was not ultra vires the provisions of the aforesaid Act. It was cautioned that if a distillery which manufactures denatured spirit attempts to alter any denatured spirit with the intention that such spirit may be us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid Rules. That to such distilleries the first part of the Rule may apply wherein the State will have to bear the cost of providing supervisors and establishments for that purpose but the cost of such establishment cannot be foisted on such distilleries. Bihar Distillery: 9.8 In Bihar Distillery, narrating the history with regard to the legislations on rectified spirit and in the context of the IDRA, and the incorporation of Item 26 in the First Schedule of the said Act which deals with "Fermentation Industries": (i) Alcohol, (ii) other products of "Fermentation Industries", this Court, speaking through Jeevan Reddy, J., noted that the decision in Synthetics and Chemicals (7J) called for demarcation of the spheres of the Union and the States, particularly in the matter of alcoholic liquors. 9.8.1 This Court observed that insofar as "intoxicating liquors"/potable liquors are concerned, it is the exclusive province of the States. But for manufacturing "intoxicating liquors", or for manufacturing "industrial alcohol", as the case may be, one must have to manufacture or purchase alcohol. It is only thereafter that the alcohol is either converted into "industrial alcohol" (by de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egulated by both by the Union as well as by the States, subject, of course, to Article 254 of the Constitution. 9.8.4 It was observed that insofar as the field is not occupied by the laws made by the Union, the States are free to legislate. It was further observed that Entry 24 - List II is in the nature of a general Entry. It deals with industries but is made expressly subject to Entries 7 and 52 - List I. That by making a declaration in terms of Entry 52 - List I in Section 2 of the IDRA, the Union has taken control of the several industries mentioned in the Schedule to the Act. As a result, the States have been denuded of their power to legislate with respect to those industries on that account. It was further observed that a three-Judge Bench in McDowell had held that Entry 52 overrides only Entry 24 - List II and no other Entry in List II. That Entry 8 - List II is not overborne in any manner by Entry 52 - List I, which means that so far as "intoxicating liquors" are concerned, they are within the exclusive sphere of the States. 9.8.5 Referring to the judgment of Sabyasachi Mukharji, J. ( as he then was) in Synthetics and Chemicals (7J), particularly paragraph 85, it was obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o good reason for doubting the correctness of the decision in Synthetics and Chemicals (7J) or for referring the issue to a larger Constitution Bench of nine or more Judges. This was because if the States' submission were to be accepted, then Item 26 in the Schedule to the IDRA would become superfluous and meaningless. Therefore, this Court in Synthetics and Chemicals (7J) speaking through Sabyasachi Mukharji, J., drew a line between the respective spheres of the Union and the States. It was also contended that despite the insertion of Item 26 in the IDRA, the State was not totally denuded of any power to make a law with respect to rectified spirit or for that matter "industrial alcohol". In this regard, Entry 33 - List III and Section 18G read with other provisions of the IDRA were considered and by placing reliance on Tika Ramji, it was observed that "the possibility of an order under Section 18G being issued by the Central Government would not be enough. The existence of such an order would be the essential prerequisite before any repugnancy could ever arise". 9.8.9 On a conspectus consideration, this Court held that the decision in Synthetics and Chemicals (7J), did not de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed rectified spirit. This Court raised several questions with regard to the supervision of the manufacture of country liquor or IMFL, which is not the concern of the Union but the bulk of the rectified spirit produced in many States is meant for and is utilised for obtaining or manufacturing potable liquors. The question was then at what stage, would the State intervene in the process of manufacture of potable liquor - whether until the stage of potable liquor is reached, or whether there has to be supervision even at a stage prior thereto by the States. This Court took into consideration the fact that under Entry 33(a) - List III, the States do have the power to legislate on this field, provided the field is not occupied by any law made by the Union. Further, 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, it was noted that there has to be a clear line of demarcation drawn at the stage of clearance or removal of rectified spirit. In the matter of the levies, when the removal or clearance is for industrial purpose, the levy of duties of excise and all other control is with the Union b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent it is so supplied, as the case may be - the levy of excise duties and all other control shall be that of the States. (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 supplying it to Governments/ persons for obtaining or manufacturing potable liquors are concerned, the following is the position: (a) The power to permit the establishment and regulation of the functioning of the distillery is concerned, it shall be the exclusive domain of the Union. But so far as the levy of excise duties is concerned, the duties on rectified spirit removed/ cleared for supply to industries (other than industries engaged in obtaining or manufacturing potable liquors), shall be levied by the Union; b) the duties of excise on rectified spirit cleared/removed for the purposes of obtaining or manufacturing potable liquors shall be levied by the State Government concerned. The disposal, i.e., clearance and removal of rectified spirit in the case of such an industry shall be u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nthetics and Chemicals (7J) continued to hold the field, it was noted that the State's power was limited to regulation of non-potable alcohol for the limited purpose of preventing its use as alcoholic liquors. Ultimately, the appeal filed by the state was dismissed as the levies could not be treated as a regulatory measure. McDowell : 9.9 In McDowell, the State of Andhra Pradesh had prohibited the manufacture of liquor by an amendment in the Andhra Pradesh Prohibition Act, 1995. The appellants therein who were manufactures of "intoxicating liquors" challenged the constitutional validity of the Act by which the Prohibition Act was amended to include Section 7-A by which the manufacture of liquor came to be prohibited. This was owing to the lack of legislative competence in view of Item 26 in the First Schedule of the IDRA, which according to the writ petitioners therein, vested the control of alcohol industries exclusively in the Union and denuded the State Legislature of its power to licence or regulate the manufacture of liquor. This argument was further based on the fact that "Fermentation Industries" were included in the Schedule of the IDRA and hence the State was denuded of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State Excise Authorities and was being used in their factory for manufacturing vinyl acetate monomer. The appellants held licences in the form of FL-39 to enable them to use the "industrial alcohol" as the main raw material for their product. The notification was challenged on two grounds: firstly, that the State of Uttar Pradesh has no power to legislate in respect of "industrial alcohol" or to levy taxes in respect thereof. Secondly, that the levy being not based on quid pro quo was otherwise bad. 9.10.1 In this case, before considering the legal contentions, this Court highlighted the difference between "industrial alcohol", denatured spirit and potable liquor. Ethyl alcohol was noted to be rectified spirit of 95% v/v in strength. Rectified spirit was highly toxic and unfit for human consumption. However, rectified spirit diluted with water was noted to be country liquor. Rectified spirit, as it was, can be used for manufacture of various other products like chemicals, etc. Rectified spirit, produced for industrial use was required by a Notification issued under the Act to be denatured in order to prevent the spirit from being directed to human consumption. Rectified spiri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Of course, the same has been explained in Synthetics and Chemicals (2J), discussed above. This Court observed in this case that denaturation of spirit meant for industrial use is meant to prevent misuse of nonpotable alcohol for human consumption and as such was specifically mentioned by the Court to be within the legislative competence of the State. This Court observed in para 14 as under: "14. It is to be noticed that the States under Entries 8 and 51 of List II read with Entry 84 of 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 taxes 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." Haryana Brewery Ltd. : 9.11 In Government of Haryana vs. Haryana Brewery Ltd., (2002) 4 SCC 547 ("Haryana Brewery Ltd."), the controversy related to levy of excise duty on beer brewed by the respondent therein. Rule 35 of the Punjab Brewery Rules, 1956 and Section 32 of the Punjab Excise Act, 1914 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asses towards manufacturing either country liquor or liquor which was fit for human consumption. Assailing the same, writ petitions were filed before the High Court which had allowed the said writ petitions. Therefore, the State had appealed before this Court. 9.13 This Court noted that molasses is a by-product of sugar and mainly used as raw material for manufacture of spirit, including alcohol for human consumption. The respondents in the said case were engaged in the manufacture of rectified spirit from molasses and penalty was imposed owing to a loss of revenue by reason of loss of wastage of molasses while carrying on manufacture of such rectified spirit. One of the contentions raised was that the State has power to impose duty only on the spirit which is for human consumption and the respondents therein had not carried out any activities in relation to manufacture of potable liquor from the molasses. It was observed that the judgment in Modi Distillery applied to the said case and therefore, no penal duty could be imposed on rectified spirit. Reliance placed on Bihar Distillery was not gone into inasmuch as it was observed that it was unnecessary to go into the question of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e held to be valid. 9.14.1 Referring to Synthetics and Chemicals (7J), it was observed that since the coming into force of the IDRA on 08.05.1952, the State Legislatures are constitutionally incompetent to levy tax on "industrial alcohol". This principle was reiterated in Modi Distillery wherein it was held that the State's power to levy excise duty was limited to alcoholic liquors for human consumption which means, that liquor which, as it is, is consumable in the sense that it is capable of being taken by human beings as such as a beverage or drink. Therefore, even if ethyl alcohol (95 per cent) could be used as a raw material or input, after processing and substantial dilution, in the production of whisky, gin, country liquor etc. nevertheless, it was not "intoxicating liquors" which expression meant only that liquor which was consumable by human beings as it was. Therefore, the State could not legislate on "industrial alcohol" despite the fact that such "industrial alcohol" has the potential to be used to manufacture alcoholic liquors for human consumption. 9.14.2 Ultimately, in paragraph 43 of the judgment, it was pithily observed as under: "43. Considering the various aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was also made to the judgment of this Court in FN Balsara and it was held that the main purpose of the impugned Act was to consolidate the law relating to manufacture, sale and possession of "intoxicating liquors" which squarely fell under Entry 8 - List II, while the main object of the Central Act was to provide for the levy and collection of duties of excise on medicinal and toilet preparations containing alcohol falling under Entry 84 - List I. According to this Court when the framework of the two enactments was examined, it was apparent that the Central and the State legislations operated in two different and distinct fields. It was held that in the matter of making rules or detailed provisions to achieve the object and purpose of a legislation, there may be some provisions seemingly overlapping or encroaching upon the forbidden field, but that does not warrant the striking down of the impugned Act as ultra vires the State Legislature. 10.3 In Synthetics and Chemicals (7J), the question for consideration was whether different legislations and rules in respect of "industrial alcohol" enacted by the States were valid. In my view, this Court was clear about the concept of "indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x being levied by the States on the "industrial alcohol" was adverted to without there being a discussion on that aspect of the matter and, therefore, to that extent the dictum of the seven-Judge Bench in Synthetics and Chemicals (7J) was per incuriam. It was further clarified that the seven-Judge Bench was only concerned with the question whether the State Legislature could levy vend fee or excise duty on "industrial alcohol" and that the said question was answered in the negative by holding that "industrial alcohol" being unfit for human consumption, the State Legislature was incompetent to levy any duty of excise under Entry 51 - List II. 10.5 In the above context, it was also observed that alcohol can be divided into two categories, namely, potable and non-potable alcohol. That alcohol which is potable is "intoxicating liquors" for human consumption directly as a beverage and comes within the scope and ambit of Entry 8 - List II and the State Legislature has the power to regulate such "intoxicating liquors" by making relevant laws. However, non-potable liquor or "industrial alcohol" as it is popularly called, can be diluted and consumed as a beverage, and the State has an obli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spirit and make it fit for human consumption. Therefore, at the distilleries of the licencees, supervision had to be provided as it was a regulatory measure. In this context also, it was clarified that the denatured spirit is a spirit which is not fit for human consumption and non-potable, and was also called as "other commercial spirits" under the rules in question, as they are used for industrial purposes or any other purpose other than human consumption as a beverage. This was opposed to potable liquor which is fit for human consumption. It was finally observed that in respect of such distilleries having composite licencees, the State will have to provide the cost of supervisors and the same could not be foisted on such distilleries. 10.8 Jeevan Reddy, J., in Bihar Distillery, also held that insofar as "intoxicating liquors or potable liquors" are concerned, they fall in the exclusive province of the State. However, alcohol can be used for the industrial purposes even without denaturing it. Significantly, it was held that Entry 8 - List II uses the expression "intoxicating liquors" which signifies "liquor for human consumption". The absence of the words "for human consumption" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of which the State has no power whatsoever under Entries 8 and 51 - List II, while the States have the exclusive competence to legislate on "intoxicating liquors" or "alcoholic liquors for human consumption" but if any alcoholic preparation is diverted for human consumption, the States would have the power to legislate under Entry 8 - List II. 10.11 Again, Jeevan Reddy, J. speaking for the Court in Bihar Distillery noted that in Synthetics and Chemicals (7J) a distinction was drawn between rectified spirit meant exclusively for industries ("industrial alcohol") and rectified spirit exclusively used for obtaining potable alcohol. The said judgment did not deal with rectified spirit which could be converted to potable alcohol as such. That insofar as the first category was concerned, it was under the exclusive control of the Union and the second category was under the control of the State at all stages including the establishment of the distillery. 10.12 In Vam Organic II, the history of the legislations on "intoxicating liquors" as well the earlier judgments of this Court were considered and it was observed that the State Legislatures are constitutionally not competent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... try which provides for imposition of excise duty on potable liquor also called alcoholic liquors for human consumption. Conversely, insofar as "industrial alcohol" is concerned, the control of the said industry is vested with the Union owing to Section 2 of the IDRA read with the other provisions of the said Act, which enactment has been made by virtue of Entry 52 - List I. That the Union has taken under its control "Fermentation Industries" as per Item 26 of the First Schedule to the IDRA which has been enacted by the Parliament in relation to Entry 52 - List I excluding "intoxicating liquors". "Fermentation Industries" relates to various products manufactured, processed, etc. as a result of fermentation process. Such products of fermentation are broadly classified as "industrial alcohol" (non-potable alcohol) and "intoxicating liquors" (potable alcohol). This classification is for the purpose of identifying the nature of the product, its use in the industry and consequently, dividing the subject of the legislation between the Parliament and the State Legislature. 11.2 The aforesaid decisions also indicate that merely because "industrial alcohol" or non-potable alcohol such as re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Limitations" [2nd ed. Boston : Little, Brown & Company, p.58], wherein it is explained as follows: "In interpreting clauses we must presume that words have been employed in their natural and ordinary meaning. Says Marshall, Ch. J.: "The framers of the Constitution, and the people who adopted it, must be understood to have employed words in their natural sense, and to have understood what they meant." This is but saying that no forced or unnatural construction is to be put upon their language; and it seems so obvious a truism that one expects to see it universally accepted without question; but the attempt is so often made by interested subtlety and ingenious refinement to induce the courts to force from these instruments a meaning which their framers never held, that it frequently becomes necessary to re-declare this fundamental maxim." ( underlining by me ) Therefore, one task before this Court is to ascertain to what extent "intoxicating liquors" had acquired a natural and ordinary meaning at the time of the Constitution coming into force. 12.2 I may note another cardinal rule of interpretation explained by Sir Maurice Gwyer C.J., of the Federal Court of India in In Re: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the phrase "intoxicating liquors" was used in the context of consumption. On 30.04.1889, the House of Commons on a motion moved by Mr. S. Smith to discuss how the fiscal system of the Government of India led to the establishment of spirit distilleries, liquor and opium shops in a large number of places where till recently (from the date of question) they never existed had several references to "intoxicating liquors" exclusively in the context of consumption. On 29.06.1904, Mr. Herbert Roberts, a person interested in temperance asked the Secretary of State for India whether he was aware that the number of 'shops open for the sale of "intoxicating liquors" and drugs in India rose from 97,910 in 1901-02 to 99,497 in 1902- 03' and whether he was in a position to explain the reasons for this increase in the number of shops opened and the consequent increase in consumption. Most interestingly, on 13.07.1937, in a sitting of the House of Lords, Lord Clwyd (formerly Mr. Herbert Roberts) asked the Secretary of State for India the following question: "To ask His Majesty's Government what was the amount in pounds sterling of the net Excise revenue of India for the years 1933-1934, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the expression "intoxicating liquors" as it appears in Entry 8 - List II has no explicit neighboring context which would indicate that it is restricted to mean only potable liquor. 12.12 The first interpretive question therefore is, whether the absence of the context of consumption expands "intoxicating liquors" to also include "industrial alcohol". In my opinion, the words "intoxicating liquors" itself explains that Entry 8 - List II does not seek to travel beyond "intoxicating liquors" meant for human consumption i.e., potable alcohol. This was also the view of Jeevan Reddy, J. in Bihar Distillery. 12.13 Another distinguishing consideration is the use of "intoxicating" as an adjective to liquor i.e., as a qualifier whereas elsewhere in the Constitution the word "alcoholic" accompanies the word liquor. Learned Chief Justice has carefully found following three inferences which are summarized as under: a) Ingredient vs. Effect: "Alcoholic liquor" defines the scope of the provision based on the ingredient, that is, alcohol whereas "intoxicating liquors" defines the scope based on effect i.e. intoxication. Therefore, liquor which is not colloquially considered alcoholic liquor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consumption the said subject is placed in Entry 8 - List II. This would imply that the rest of "Fermentation Industries" would be within the scope and ambit of Entry 24 - List II which is subject to Entry 52 - List I and is a scheduled industry as per Section 2 read with Item 26 of First Schedule of IDRA. 12.15 One must also be cognizant of the fact that Entry 8 - List II concerns itself with "intoxicating liquors" even from a historical perspective. Constitutional framers were not engaged in a theoretical task of demarcating legislative fields but in their utmost wisdom and pragmatism distributed legislate fields between Parliament and State Legislatures that would continue to determine the governance of the nation. One must note that a construction of Entry 8 - List II should not potentially give the States the legislative competence to legislate on "industrial alcohol" which is a scheduled industry under IDRA. That Entry 8 - List II which deals with "intoxicating liquors" cannot also subsume industries for manufacture of "industrial alcohol", etc. 12.16 Therefore, in deciding on "intoxicating liquors", the contours of interpretation must be concerned only with the very nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egrees and to be of a strength not exceeding two degrees of proof : Customs and Excise Act, 1952. (v) "Intoxicating liquors" means spirits, wine, beer, cider and any fermented, distilled or spiritous liquor but (apart from cider) does not include any liquor for the sale of which by wholesale no excise licence is required : Licensing Act, 1964. (vi) "Cider" means cider or perry of a strength less than 8.7 per cent of alcohol by volume at 20 degrees Centigrade obtained from the fermentation of apple or pear juice without the addition at any time of any alcoholic liquor or liquor or substance which communicates colour or flavour other than such as the Commissioner of Customs and Excise may allow as appearing to them to be necessary to make cider or perry : Customs and Excise Act, 1952. (vii) "Intoxicating liquors other than spirits" includes beer, wine, made-wine and cider. 12.18 It may also be useful to outline some undisputed elements of "industrial alcohol". It is an undisputed position that "industrial alcohol" is not meant to be consumed as a human beverage. In other words, it is not produced or manufactured to be meant for direct human consumption as a beverage. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the intoxicating effect. In my view, the sine qua non of Entry 8 - List II i.e. the "intoxicating" effect of liquor has to be read as (i) an effect, and (ii) an intended effect of the industry and its products. One might argue that even "industrial alcohol" due to its very constituents could cause an intoxicating effect, when mischievously consumed, albeit with dire consequences. However, such an argument ignores that the fundamental nature of "industrial alcohol" is that it is non-potable i.e. when put to its actual use, neither is it intended to be consumed by human beings as a beverage nor, as a corollary, is sought to cause an "intoxicating" effect on human beings. "Industrial alcohol" can be said to cause an "intoxicating" effect only when it is mischievously directed away from its actual purpose and use and towards human consumption. To accept such a rationale for interpreting Entry 8 - List II would lead to an anomalous situation wherein the marginal mischievous use of "industrial alcohol" would bring in the whole industry of "industrial alcohol" to Entry 8 - List II and take it out of Entry 24 - List II viz. "industrial alcohol" which is not always meant to intoxicate a hum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ament by law to be necessary for the purpose of defence or for the prosecution of war. xxx 52. Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest. xxx 54. Regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest." 13.1 What is common between Entry 52 - List I and Entry 54 - List I is the fact that control of industries or regulation and development of mines and mineral development respectively is to the degree or extent under the control of the Union which is expressed by a declaration made by Parliament by law to be expedient in the public interest. Thus, under Entry 52 - List I, the intent to control an industry: (i) by the Union; (ii) by a declaration by Parliament by law; and (iii) which law is expedient in the public interest are the key phrases to be taken note of. Thus, if there is a declaration by Parliament by law (such as IDRA) to control any of the industries by the Union, such as "Fermentation Industries" which is expedient in the public interest t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entries 7 and 52 - List I, Entry 24 - List II and Entry 33 - List III, inter alia, had passed through. Considering Entry 52 - List I and Entry 24 - List II, it was observed that "industry" as a head of legislation is to be found in Entry 24 - List II with the limitation that it is subject to Entries 7 and 52 - List I. The difference in the language in which Entries 7 and 52 - List I is couched has a bearing on the interpretation of Entry 52 - List I. The subject "industry" being enumerated in List II, the State Legislature has power to legislate in respect to it and keeping aside the words "subject to the provision of Entries 7 and 52 of List I", the State Legislature alone can legislate in respect of the legislative head "industry". Ipso facto Parliament would have no power to legislate in respect of industry as a legislative head. Under Entry 52 - List I, unless and until a declaration is made by Parliament by law to assume control over specified industries, the embargo on the power of Parliament to legislate in respect of industry would not be lifted. The declaration has to be made by Parliament by law to assume control over specified industry in public interest. Thus, the exten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon any control exercise by the Union under the various provisions of the IDRA. That the IDRA is not concerned with the ownership of industrial undertaking in declared industry except the control over the management of the undertaking by the owner. Thus the legislative power of the State under Entry 24 - List II is eroded only to the extent control is assumed by the Union pursuant to a declaration made by the Parliament in respect of a declared industry as spelt out by the legislative enactment and the field occupied by such enactment is the measure of erosion. Subject to such erosion, on the remainder the State Legislature will have power to legislate in respect of a declared industry without in any way trenching upon the occupied field. It was held that State Legislature which is otherwise competent to deal with industry under Entry 24 - List II can deal with that industry in exercise of other powers enabling it to legislate under different heads set out in Lists II and III and this power cannot be denied to a State. The second limb of the submission therein is not related to the present controversy and need not be adverted to. It was finally observed that the impugned Act was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was a reluctance to enter upon an examination of the mutually competing claims of Entry 52 - List I and Entry 24 - List II - Entries which deal with "industries". Consequently, the appeals were dismissed. 13.3 When the expression "subject to" is used in an Entry in List II it would imply that the said Entry is subordinate to the respective Entries in List I and has to be read along with the relevant Entry in List I. Thus, on a conjoint reading of Entry 24 - List II with Entry 52 - List I, it is apparent that Entry 24 - List II is subject to Entry 52 - List I. The expression "subject to" in the Entries in List II has been a subject matter of interpretation in several decisions and is of legal import. 13.3.1 As per Black's Law Dictionary, 5th Edition, Pg.1278, "subject to" means "liable, subordinate, subservient, inferior, obedient to, governed or affected by." 13.3.2 The relevant judgments of this Court on the point are discussed as under: a) In Hingir Rampur Coal Company vs. State of Orissa, (1961) 2 SCR 537 ("Hingir Rampur"), while interpreting the import of the expression "subject to" in Entry 23 - List II and the interplay of that Entry with Entry 54 - List I, this Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eby 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 regulatory Entry which provides State Legislatures with the competence to legislate on "industries" subject to Entry 7 - List I and Entry 52 - List I. In effect, Entry 52 - List I enables the Union to take an industry out of the legislative competence of States and bring it within Entry 52 - List I. In the instant cases, the primary question is whether there is any overlap between Entry 52 - List I and Entry 8 - List II. In other words, is there any conflict between the exclusive competence of State Legislatures under Entry 8 - List II and the regulation of industries the control of which by the Union is declared by Parliament by law to be expedient in the public interest under Entry 52 - List I? 13.4.1 It is a settled law that the meaning of "industries" in Entry 52 - List I and Entry 24 - List II is coextensive. Therefore, what is out of Entry 24 - List II will also not be within Entry 52 - List I. In that context, it has been contended before us that Entry 8 - List II is a unique Entry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 - 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 harmonious construction, "gas and gas works" were found to be within the exclusive field allotted to the States and outside the legislative field of Parliament. It was further observed that the expression "industry" in Entry 52 - List I bears the same meaning as that in Entry 24 - List II, with the result that the said expression in Entry 52 - List I also does not take in the industry of "gas and gas works". If so, it followed that the IDRA, in so far as it purported to deal with the "gas industry" is beyond the legislative competence of Parliament. 13.4.4 Keeping the aforesaid dictum in mind, it must be observed that Entry 8 - List II being a special Entry prevails over the general Entry 24 - List II. Therefore, while Entry 52 - List and Entry 8 - List II overlap on the aspect of "industry" of "intoxicating liquors", Entry 52 - List I cannot takeover the "industry" of "intoxicating liquors". 13.5 The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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-paragraph (b) of the said Entry. In other words, alcoholic liquors not meant for human consumption and medicinal and toilet preparations containing alcohol or any substance such as opium, Indian hemp and other narcotic drugs and narcotics would be subject to excise duty leviable under Entry 84 - List I by the Central Government. Insofar as alcoholic liquors for human consumption is concerned, the States have the power to levy excise duty. 13.7 Therefore, in my view, the framers of the Constitution bifurcated alcoholic liquors for human consumption as distinct from alcohol used for medicinal and toilet preparations or any other liquor including "industrial liquor" on which excise duty is leviable under Entry 84 - List I. What is the purpose of excluding levy of excise duty under Entry 84 - List I on alcoholic liquors for human consumpti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly 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 "intoxicating liquors" and the expression "intoxicating liquors" in Entry 8 - List II means alcoholic liquors directly for human consumption as a beverage. Thus, no other alcoholic liquors can be regulated as per Entry 8 - List II except to ensure that there is no abuse/misuse of "industrial alcohol" being treated for human consumption by subjecting it to a particular process; nor can any excise duty be levied on such liquor by the State Legislature. Hence, any "intoxicating liquors" would mean alcoholic liquors for human consumption which is produced, manufactured, possessed, transported, purchased or sold and can be regulated under Entry 8 - List II by the State Legislature but alcoholic liquors which are not for human consumption as a beverage would not come within the scope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 goods found in Entry 27 - List II as well as in Entry 33(a) - List III regarding any product of an industry has a nexus with Entry 52 - List I. 13.12 Further, Entry 24 - List II which deals with industries, is itself subject to Entry 52 - List I. Therefore, if any industry is mentioned in the First Schedule of the IDRA which is a legislation passed by the Parliament by virtue of Entry 52 - List I, a reading of the same conjointly with Entry 33(a) - List III would mean that particular industry which has been mentioned in the First Schedule of IDRA would be under the control of the Union. However, as far as the products of such industry are concerned, Entry 33(a) - List III deals with the aspect of production and sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 various aspects. Sub-section (4) of Section 18G states that no order made in exercise of any power conferred by this section shall be called in question in any court. 14.2 One of the contentions raised in this batch of cases is with regard to whether the Central Government has to, in fact, issue a notified order with regard to regulating the supply and distribution and trade and commerce of any article or class of articles relatable to any scheduled industry so as to indicate that the State Legislature cannot pass any legislation under Entry 33(a) - List III. In my considered view, the fact that an industry is a scheduled industry under the IDRA would imply that at any time the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 imply that the Central Government is empowered to issue a notified order in terms of Section 18G of the said Act as and when it is necessary or expedient to secure the equitable distribution and availability at a fair price of any article related to any scheduled industry. In such a case, the notified order being issued under Section 18G of the IDRA, would have an overriding effect on the States' laws if any made under Entry 33(a) - List III in regard to trade and commerce, supply and distribution of such articles or products of the scheduled industry which are covered under the notified order and the same would no longer be applicable wherever there is a conflict in the laws. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 law adding to, amending, varying or repealing the law so made by the Legislature of the State. 14.9 What is of significance under the second portion of Article 254(1) is that the law has to be passed by the Parliament either before or after the law made by the Legislature of such a State, secondly, such a law must be with respect to one of the matters enumerated in the Concurrent List. The above is a case of actual repugnancy. There can also be a case of what can be called potential repugnancy, which is also expressed as the doctrine of occupied field which shall be discussed at this stage in the context of the observations made in Synthetics and Chemicals (7J). E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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), both the Union as well as the States have concurrent powers to enact laws. It must be remembered that Entry 33(a) - List III is a field of legislation and therefore, deals with the concurrent legislative competence of both the Union as well as the State Legislature. An enactment under such an Entry by the State is subject to the application of the principle of repugnancy as envisaged in Article 254 of the Constitution discussed above. 15.3 One cannot lose sight of the fact that the IDRA has been enacted by Parliament taking control of certain industries such as the "Fermentation Industries", which is the subject matter of controversy in the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 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 State's legislative competence vis-à-vis Entry 33(a) - List III with respect to a product of a scheduled industry which in the instant cases is the "Fermentation Industries". 15.6 The aforesaid observation which has led to a reference to this nine-Judge Bench has to be considered in light of Entry 52 - List I, Entry 33(a) - List III and Section 18G of the IDRA. As already stated, it is pursuant to Entry 52 - List I that the IDRA has been enacted by the Parliament declaring the taking of control of industries mentioned in the First Schedule to the said Act called a scheduled industry. Entry 33(a) - Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duled 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; (c) for prohibiting the withholding from sale of any such article or class thereof ordinarily kept for sale; (d) for requiring any person manufacturing, producing or holding in stock any such article or class thereof to sell the whole or part of the articles so manufactured or produced during a specified period or to sell the whole or a part of the articles so held in stock to such person or class of persons in such circumstances as may be specified in the order; (e) for regulating or prohibiting any class of commercial or financial transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as 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 clause in Article 246(1) read with the opening words "subject" in Article 246(3). In such a case, the State law will fail not because of repugnance to the Union law but due to want of legislative competence. Thus, the question of repugnancy arises only when both the Legislatures are competent to legislate in the same field, that is, with respect to one of the matters mentioned in the Concurrent List. Hence, Article 254(1) cannot apply unless both the Union and the State laws relate to a subject specified in the Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 determine whether the legislative field has been occupied? Firstly, there must be a Parliamentary law in place with an intention to occupy the field. Secondly, the contours of the field must be determined. Consequently, the State Legislature would be prevented from making the law in terms of what has been determined by the Parliament to occupy the field. Thus, the intention to occupy the field must be explicit and clear and discernible with the result that the State Legislature would have a reduced field or the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ist, 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 by virtue of insertion of Section 18G to the IDRA, the legislative competence of the State Legislatures under Entry 33(a) - List III vis-à-vis products of the scheduled industry namely, "Fermentation Industries" would be governed within the scope and ambit of Section 18G of the IDRA and consequently, the State Legislatures would have no competence to make a law in regard to the products of a scheduled industry in respect of which Section 18G applies. This is by bearing in mind the twin tests refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 18G also indicates that the Parliament has intended to occupy the field as demarcated under Section 18G. Such an interpretation has to be given in order to avoid a legal uncertainty and quandary in the economy in the context of Section 18G of the IDRA. 16.10 Thus, the question, whether, under Entry 33(a) - List III, the States have been denuded of their powers by virtue of insertion of Section 18G to the IDRA, i.e., Section 18G having occupied the field to the extent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eral 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 mineral rights by way of a law relating to mineral development. Thus, while Entry 50 - List II speaks of taxes on mineral rights and is a taxation Entry empowering States to impose taxes on mineral rights, the same is not unbridled or absolute but is subject to any limitation to be imposed by Parliament by law relating to mineral development. In other words, if Parliament intends to regulate mineral development in the coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 could happen at any point of time having regard to the situations and conditions which emerge in the Indian economy with regard to a product of a scheduled industry which is also described as an article or class of articles relatable to any scheduled industry under Section 18G of IDRA. Thus, when the field is occupied by Section 18G of the IDRA which is an enactment made pursuant to Entry 52 - List I and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. 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 sugarcane was an article or class of articles relatable to the sugar industry within the meaning of Section 18G of the IDRA, since no order was issued by the Central Government in exercise of the powers vested in it under that section, no question of repugnancy could ever arise because repugnancy must exist in fact and not depend merely on a possibility. The possibility of an order under Section 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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) upon making of the Central Act (i.e. 19.08.1982 when the President gave his assent) or whether the Kerala Chitties Act 23 of 1975 would become repugnant to the Central Act as and when the notification under Section 1(3) of the Central Act bringing the Central Act into force in the State of Kerala is issued. In other words, the question raised was whether making of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otes 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 matters in their allotted spheres, overlap and conflict. Second, where the two legislations are with respect to matters in the Concurrent List and there is a conflict. In both the situations, the parliamentary legislation will predominate, in the first, by virtue of non obstante clause in Article 246(1); in the second, by reason of Article 254( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ol 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 would fully operate. Then, Entries 26 and 27 - List II would not be subject to the restriction under Entry 33(a) - List III nor to Entry 52 - List I. The States would have the liberty to pass laws with regard to trade and commerce, production supply and distribution of goods of any industry under Entries 26 and/or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 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 inserted to the IDRA which has been enacted pursuant to Entry 52 - List I. As a result, time of insertion of Section 18G to the IDRA, the intention of the Union is to occupy the field insofar as an article or articles of scheduled industry is concerned which will also include a product of a schedule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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% blending of ethanol with petrol by 2025; ii) The supply of ethanol to OMCs has increased by more than 13 times from 38 crore litres in ESY 2013-13 to 502 crore litres in ESY 2022-23; iii) To achieve the target of 20% blending by 2025, about 1016 crore lit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry 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 development of twentieth century welfare States guided the constitutional blueprint for a model of federalism in which provincial initiative should not preclude national coordination, particularly, in the fields of soc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate 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 was of the firm view that the principles of Union Supremacy cannot be undermined from Articles 246 and 254. While the immediate paragraph is concerned with legislative actions taken un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 order when issued by the Central Government under Section 18G of the IDRA cannot be questioned in any Court of law. This also i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 thereby giving legislative competence in respect of all scheduled industries to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 the competence to wholly regulate "industrial al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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; 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpretation will substantially diminish the scope of multiple other legislative entries; The entire controversy cannot be viewed 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 clarifie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 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 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock; (g) for collecting any information or statistics with a view to regulating or prohibiting any of the aforesaid matters; and (h) for any incidental or supplementary matters, including, in particular, the grant of issue of licences, permits, or other documents 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 tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for potable alcohol. This is enough to justify a provision like Section 58-A." 38 (1992) 2 SCC 399 39 1996 3 SCC 709 40 1996 3 SCC 709 [33] 41 (1997) 2 SCC 715 42 (1997) 2 SCC 715 [13] 43 (1997) 2 SCC 715 [13,14] "14. It is to be noticed that the States under Entries 8 and 51 of List II read with Entry 84 of 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 cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ul Quader & Co. v. STO, (1964) 6 SCR 867; HM Seervai, Constitutional Law of India, Volume 3 (4th edn.) [25.57] 2340-2341. 85 United Province v. Atiqa Begum, (1940) FCR 110; Constitution of India, Article 13 86 ibid 87 United Provinces v. Atiqa Begum, (1940) FCR 110; Western India Theatres Ltd. V. Cantonment Board, Elel Hotels & Investments Ltd. V. Union of India; Godfrey Phillips 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 Consoli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the Government Order in the present case for the considerations that applied in the case before the Federal Court have no application here." [emphasis supplied] 100 (2004) 11 SCC 26 101 (2000) 5 SCC 511 102 (2001) 2 SCC 201 103 (2001) 2 SCC 201 [158] 104 (1954) 2 SCC 152 105 See Tika Ramji v. State of UP, AIR 1956 SC 676 106 2024 INSC 554 107 "MMDRA" 108 2024 INSC 554 [158-161] 109 (1980) 4 SCC 136 110 (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. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uation (special excludes the general), we must hold that the industries engaged in production and manufacture of intoxicating liquors do not have within Entry 24 but do fall within Entry 8. This was the position at the commencement of the Constitution and this is the position today as well. Once this is so, the making of a declaration by Parliament as contemplated by Entry 52 of List I does not have the effect of transferring or transplanting, as it may be 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 Legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intoxicating liquor carries with it the power to regulate the manufacture, sale and possession of medicinal and toilet preparations containing alcohol, not for the purpose of interfering with the right of citizens in the matter of consumption or use for bona fide medicinal and toilet preparations, but for preventing intoxicating liquors from being passed on under the guise of medicinal and toilet preparations. It was within the competence of the State legislature to prevent the noxious use of such preparations, i.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 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 3(8) 157 Abkari Act 1077; Section 3(10) 158 Similar definitions in Bihar and Orissa Excise Act 1915; Sections 2(14); 2(19) 159 The Bengal Excise Act 1909; Section 2(12a) 160 The Bengal Excise Act 1909; Section 2(14) 161 The Bengal Excise Act 1909; Section 2(19) 162 Similar definitions in The Punjab 'article' Excise Act 1914; Section 2(14); The Chhattisgarh Excise Act 1915; Section 2(13); United Province Excise Act 1910; Section 3(11) 163 MP Excise Act 1916; Section 2(13) 164 The Licensing (Consolidating Act) 1872; Section 74 165 Spirits Act 1880; Section 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 footn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t II: "26. Control of production, manufacture, possession, transport, purchase and sale of alcoholic liquors, drugs and narcotics." 180 Command paper 4268; Entry 27 of List II: "27. Imposition and regulation of duties of excise on alcoholic liquors, drugs and narcotics other than tobacco." 181 Report of the Joint Committee on Indian Constitutional Reform; Entry 49 of List I 182 Report of the Joint Committee on Indian Constitutional Reform; Entry 19 of List II 183 Government of India Act 1935; Entry 45 of list I 184 Government of India Act 1935; Entry 31 of list II 185 Constitution of India 1950; Entry 84 of 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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