TMI Blog1970 (8) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... to act within the limits of the power granted to it. We are of the opinion that the impugned rule as well as the demands are not authorised by law. Hence we allow these appeals as well as the writ petitions from which these appeals arise and quash the impugned notification as well as the demand notices. - C.A. 2214 OF 1969 - - - Dated:- 19-8-1970 - Judge(s) : A. N. GROVER., K. S. HEGDE., J. C. SHAH JUDGMENT The judgment of the court was delivered by HEGDE J.--These appeals by certificates granted by the High Court of Madhya Pradesh raise common questions of law. Hence we propose to dispose of them by a common order. The appellants herein are excise contractors. They are the successful bidders for some of the shops in Madhya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of vending liquor in a shop, (2) he has to pay the price of the liquor purchased by him--generally the Government has a monopoly of liquor maufacture--and (3) he has to pay excise duty on the liquor purchased by him. In this case there is no dispute that the appellants had paid the prescribed licence fee, the price of the liquor purchased by them and also the duty on the liquor taken delivery of by them. The dispute centres round the duty required to be paid by them under the impugned clause in the notification of March 20, 1964, referred to earlier. The controversy is whether the said clause is valid in law. The Government of Madhya Pradesh have issued demand notices on the appellants demanding the duty said to be due from them as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of this entry the State is competent to levy excise duty only on goods manufactured or produced in the State. The expression " export " is defined in section 2(9) of the Act as meaning to take out of the State otherwise than across customs frontier as defined by the Central Government. The term " manufacture " is defined in section 2(14). It reads : " 'manufacture' includes every process whether natural of artificial by which any intoxicant is produced or prepared and also redistillation and every process for the rectification, flavouring, blending or colouring of liquor. " The word " transport " is defined in section 2(19) to mean to move from one place to another within the State. The excise duty is a duty on manufacture or pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nto India and was liable, on such importation, to duty under the Sea Customs Act, VIII of 1878, or the Indian Tariff Act, VIII of 1894. " Under this section excise duty or countervailing duty can be imposed on excisable articles when they are either imported or exported or transported or manufactured or cultivated or collected and not otherwise. Section 26 deals with the manner of levying the duty. It says : " Subject to such rules regulating the time, place and manner as the State Government may prescribe, such duty shall be levied rateably on the quantity of excisable articles imported, exported, transported, collected or manufactured in or issued from a distillery, brewery or warehouse : Provided that : (1) duty may be levied-- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ular, and without prejudice to the generality of the foregoing provision, the State Government may make rules ...... (d) regulating the import, export, transport, manufacture, collection, possession, supply or storage of any intoxicant, or the cultivation of the hemp plant and may, by such rules, among other matters-- (i) regulate the tapping of tari producing trees, the drawing of tari from such trees, the marking of the same and the maintenance of such marks ; (ii) declare the process by which spirit shall be denatured and the denaturation of sprit ascertained ; and (iii) cause spirit to be denatured through the agency or under the supervision of its own officers ; (d-I) regulating the import, export, transport, collection, poss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nferred with any power to levy duty on any articles which do not fall within the scope of section 25. Therefore, it is not necessary to consider whether any such power can be conferred on that authority. Quite clearly the State Government purported to levy duty on liquor which the contractors failed to lift. In so doing it was attempting to exercise a power which it did not possess. No tax can be imposed by any bye-law or rule or regulation unless the statute under which the subordinate legislation is made specially authorises the imposition even if it is assumed that the power to tax can be delegated to the executive. The basis of the statutory power conferred by the statute cannot be transgressed by the rule-making authority. A rule-mak ..... X X X X Extracts X X X X X X X X Extracts X X X X
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