LexKALYAN CHEMICALS versus GOVERNMENT OF A.P. & ORS
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A B (2015] 9 S.C.R. 186 KALYAN CHEMICALS v. GOVERNMENT OF A.P. & ORS (Civil Appeal Nos. 5307-5308 of 2005) AUGUST 12, 2015 [VIKRAMAJIT SEN AND SHIVA KIRTI SINGH, JJ.] Andhra Pradesh Denatured Spirit and Denatured c Spirituous Preparations Rules, 1971: r. 3 - Pursuant to G 0. M. No. 147 dated 6.3.1998, the Government amended rule 3 whereby it introduced the collection of administrative fee of 50 paise per bulk litre - This Rule was given retrospective effect from 25. 10. 1989 - Appellant filed writ petition on the D ground that the amendment cannot be given retrospective effect and that fees should be levied@ 7 paise per litre since this amount was found to be reasonable in Vam Organics case- Held: s. 72 (3) of A.P Excise Act, 1968 permits making the rules under the Act with retrospective effect- Moreover, E 7 paise was deemed to be reasonable on the facts of that case which would not in any way indicate that a larger amount would be excessive especially with the passage of time - The subject Regulatory fees intended to prevent the conversion of alcoholic liquor for industrial use to that for F · human consumption is legal and need not be strictly quid pro quo as long as it is not excessive. Dismissing the appeals, the Court G HELD: No ground is made out for the contention that amendment cannot be give retrospective effect and Section 72(3) of the Andhra Pradesh Excise Act, 1968 specifi~ally allows that - "Any rules under this Act may be made with retrospective effect and when such a rule H is made the reason for making the rule shall be specified 186 · KALYAN CHEMICALS v. GOVERNMENT OF A. P. & ORS 187 in a statement to be laid before both Houses of the State A Legislature." As regards the contention that fees should be levied @7 paise per litre since this amount was found to be reasonable in Varn Organics case, 7 paise was deemed to be reasonable on the facts of that case which would not in any way indicate that a larger amount would B be excessive especially with the passage of time. In light of Synthetics and Chemicals Limited and Varn Organics Chemicals Ltd., the subject Regulatory Fees intended to prevent the conversion of alcoholic liquor for industrial use to that for human consumption is legal, C and need not be strictly quid pro quo as long as it is not excessive. [Para 5) [191-A-E] Vam Organics Chemicals Ltd. vs. State of U.P (1997) 2 SC 715:1997 (1) SCR 403; Synthetics & D Chemicals Limited vs. State ofU.P (1990) 1SCC109: 19.89 (1) Suppl. SCR 623- relied on. Case Law Reference 1989 (1) Suppl. SCR 623 1997 (1) SCR 403 relied on. Para 2 relied on. Para 3 CIVILAPPELLATE JURISDICTION: Civil Appeal Nos. E 5307 -5308 of 2005 F From the Judgment and Order dated 21.10.2003 and 02.07.2004 of the High Court of Judicature of Andhra Pradesh in W.P. No. 5284 of 2001 and Rev. W. P. Misc. Petition No. 14353 of 2004 respectively G A. T. M. Ranga Ramanujam, Hitesh Kumar Sharma, Prachar Sharma, Sridhar Reddy, Abhijit Sengupta for the Appellant. H 188 SUPREME COURT REPORTS [2015] 9 S.C.R. A Prerna Singh, Guntur Prabhakar for the Respondents. The Judgment of the Court was delivered by VIKRAMAJIT SEN, J. 1 The Appellant before us assail B the concurrent findings of the learned Single Judge and the Division Bench of the High Court of Andhra Pradesh at Hyderabad, upholding the legality of the levy of an Administrative Fee at the rate of 50 paise per bulk litre or any other rate as may be fixed by the Government from time to c time on industrial alcohol obtained from a distillery. 2 The Appellant is a manufacturer of Ethyl Acetate, the basic raw material for which is industrial alcohol. The Appellant has been receiving allotments of denatured spirit from the D Respondents since 1972. By way of an amendment to Rule 3 of the Andhra Pradesh Denatured Spirit and Denatured Spirituous Preparations Ruled, 1971 (1971 Rules for brevity), the collection of a gallonage fee, under the head of privilege fees, at the rate of 1 per bulk litre was introduced. The Appellant E filed a writ petition in 1995 contending that the levy and collection of such an amount without rendering any service is illegal, arbitrary and without justification. The High Court vide its order dated 13.10.1997 disposed of the writ petition, directing the Appellant to approach the concerned authorities F seeking a refund and with a direction to the authorities to consid
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