M/S. AQUEOUS VICTUALS PVT. LTD. versus STATE OF U.P. AND. ORS.

Citation: [1998] 3 S.C.R. 290 · Decided: 08-05-1998 · Supreme Court of India · Bench: S.B. MAJMUDAR · Disposal: Appeal(s) allowed
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

A 
MIS. AQUEOUS VICTUALS PVT. LTD. 
v. 
STATE OF U.P. AND. ORS. 
MAY 8, 1998 
B 
[S.B. MAJMUDAR AND M. JAGANNADHA RAO, JJ.] 
U.P. Municipalities Act 1916, Ss.128 (i)(viii) r/w Ss. 134,135- Octroi 
on soft drinks-Whether weight of glass bottles containing beverages imported 
within municipal limits could be included for purposes of levying octroi 
C duty-Held; if empty bottles were re-exported from municipal limits, exporter 
liable to get refund provided octroi duty on empty bottles not passed on to 
consumers-Doctrine of unjust enrichment. 
The appellant bottled soft drinks at its plants at Bareiley and thereafter 
distributed them to wholesalers including those in the respondent-
D municipalities. From 1980 onwards, the respondents sought to levy octroi 
duty on the basis of the gross weight of the beverage as well as the .bottles 
in which thy were brought into the municipal limits. This was challenged by 
the appellant in writ petitions before the Allahabad High Court in 1983. The 
,. · -<
High Court granted stay of recovery from 1983 till 1987 when the weight 
E of bottles got exempted from octroi. The dispute was thus confined to the 
period 1980 to 1987. 
F 
Relying on it earlier decision in Prem Nath Monga Bottlers (P) Ltd. 
v. Municipal Board, Meerut, the High Court dismissed the writ petitions. In 
this court the appellant contended that while the municipalities could validly 
impose octroi on the weight of liquid contents of the bottles, thy could not 
on the weight of bottles which were, after taking out the liquid contained 
therein, being sent back in their empty state to the appellant by the wholesalers 
for recycling. Thus these bottles were not imported within the local limiis 
of the municipalities for consumption, use or sale therein. On the other 
hand, the municipalities contented that even the weight of bottles containing 
G these liquids could legitimately be taken into consideration for imposing the 
octroi duty thereon. 
Allowing the appals, this Court 
HELD: 1.1. The weight ofbardana or packing which contained the 
consignments of octroiable beverage would remain liable to be included in 
H the taxable gross weight of the consignment provided such bardana or packing 
290 
l> 
.. 
ACQUEOUS VICTUALS PVT.LTD. v. STA TE 
291 
was shown to be brought within the municipal limits for the purpose of its A 
sale, consumption or use within the municipal limits. If such packing was 
not brought within the municipal limit for the purpose of consumption or 
sale or use tbereofand was found to have be taken out of the municipal limits 
after its contents were discharged within the municipal limits, then the 
weight of such outgoing bardana or packing, on the express language of the B 
charging provision, could not be brought to octroi tax or if such a tax was 
levied at the entry point, it would become liable to be refunded. [299-E-G) -
Burmah Shell Oil Storage & Distribution Company India Ltd. v. The 
Belgaum Borough Municipality, 11963) Supp. 2 S.C.R. 216, followed. 
Prem Nath Monga Bottlers (P) Ltd. v. Municipal Board. Meerut, (decided C 
by Allahabad High Court in Civil Misc. Writ Petition No. 6883of1973 on 
11.2.80, overruled. 
S.M. Ram Lal & Co. v. Secretary to Government of Punjab, (1969) 1 
U.J., (S.C.) 373. 
Ba/sore Talkies (P) Ltd. v. Balasore Municipality, AIR (1986) Orissa 
230; Nagar Mahapalika, Meerut v. Prem Nath Monga Bottlers Pvt. Ltd., 
[1996] 8 SCC l; Premier Breweries v. State of Kera/a, 11986] 1 SCC 641 
and Tata Engineering & Locomotive Company Ltd. v. Municipal Corporation 
of the City of Thane, 11992] Suppl. l SCC 361, referred to. 
Shorter Oxford Dictionary, Volume 2, 3rd Edition, p. 179, referred to. 
1.2. If the writ petitioner satisfied the authorities concerned that the 
bottles containing the original consignments after getting emptied within 
D 
E 
the municipal limits were actually taken out of the municipal limits for F 
recycling, then the writ petitioner would be entitled to claim proportionate 
refund of the octroi duty assessed on the weight of such empty bottles only 
subject to the burden of such amount of duty not being shown to have be 
passed on to the consumers of beverage or to anyone else. (306-B) 
Mafatlal Industries Ltd. v. Union of India, [1977) SCC 536, referred G 
to. 
1.3. The writ petitioner was permitted to lodge claims for refund of 
octroi duty paid on the weight of re-exported empty bottles during the relevant 
period from 1980 to 1987 backed up by r
Excerpt shown. Read the full judgment & AI analysis in Lexace.