LexSTATE OF U.P. AND ANR. versus SYNTHETICS AND CHEMICALS LTD. AND ANR.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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STATE OF U.P. AND ANR.
v,
SYNTHETICS AND CHEMICALS LTD. AND ANR.
MARCH 15, 1993
[B.P. JEEVAN REDDY AND N. VENKATACHALA, JJ.)
Constitution of India, 1950 : Article 136-Special leave petition-High
Court's direction : "We further direct that the respondents shall not allot molas-
ses to the petitioner in accordance wich the assurance given to the petitioner
A
B
vide order of the Government dated 23.3:1989''---ConstlUction.
C
The High Court reiterating the principles enunciation in Synthetics
and Chemicals Ltd. and Ors. v. State of U.P. and Ors., [1990] 1 S.C.C. 109
held that the Central Government had the exclusive power to grant a
licence for the manufacture of industrial alcohol and it was not necessary
for the Company-respondent to obtain a PD-2 licence from the Excise D
Commissioner before starting its distillery for the manufacture of indus-
tial alcohol. The High Court directed the State of U.P. and another not to
interfere with the respondent-Company's manufacturing Indnstrial al·
cohol in the distillery for which licence was granted bot subject to the
State Government's right to ensure that industrial alcohol was not con· E
verted into potable alcohol. The State of U.P. filed a special ;eave petition
against the judgment of the High Court, in this Court contending that
before manufacturing industrial alcohol, the respondent-company was to
manufacture into rectified spirit and that rectified spirit Could be con·
verted potable liquor by merely adding water; that the High Court did not F
give any reason in support of the High Court's direction.
'We further direct that the respondents shall allot molasses to the
petitioner in accordance with the assurance given to the petitioner vide
order of the Government dated 23.3.198J."
The respondent-Company submitted that the High Court order was
extended from time to time for the subsequent years as well.
Dismissing the Special Leave Petition, this Court,
G
HELD: 01. The law laid down by this court and the observations of H
291
_ ...
292
SUPREME COURT REPORTS
[1993] 2 S.C.R.
A the High Court in the impugned judgment recognise and safeguard the
right of the State Govt. to guard against any abuse and to ensure that
. ...,
B
c
D
rectilied spirit is not diverted for human consumption. That power is
affirmed. [293F)
02. The direction of the High Court cannot be construed and shall
not be understood as calling upon or directing the Government to do
anything, or to make any supplies, contrary to the provisions of the
provisions of the Molasses Contra! Order or any other law governing the
supplies of molasses. The supply of molasses to the respondent shall he
made in accordance with law. {294A-B]
Synthetics and Chemicals Ltd. and Ors. v. State of U.P. and Ors.,
[1990] 1 SCC 109, referred. to. [292F]
CIVIL APPELLATE JURISDICTION : Special Leave Petition (c)
No.17098 of 1992.
From the Judgment and Order dated 23.10.1992 of the Allahabad
High Court in Civil Misc. Writ Petition No.473 of 1992.
R.B. Misra for the Petitioners.
E
Ms. Shalini Soni, Mrs. P.S. Shroff (For M/s S.A. Shroff & Co.) for
the Respondents.
The following Order of the Court was delivered:
Heard counsel for the petitioners as well as the counsel for the
F
respondents. We see no reason to entertain this special leave petition. It is
established by the decision of this Court in Synthetics and Chemicals Ltd
and Ors. v. State ·of U.P. and Ors., [1990] 1 S.C.C. 109 that so far as the
industrial alcohol is concerned, the power of licencing vests in the Union
of India alone. At the same time it is held that the power of the State
Government to legislate with respect to potable liquor referable to Entry
G 6 of List II remains unaffected. It is also held that the S•ate has the power
to make regulations and to take appropriate action to ensure that non-
potable alcohol is not diverted and misused as a substitute for potable
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alcohol. Another principle enunciated in the said decision is that the State
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can, not only charge excise duty on potable alcohol and sales tax on sales
H of such potable alcohol, but also entitled, in cases it renders any service,
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STAIB OF U.P. v. SYNTHETICS & CHEMICALS LTD.
293
as distinct from its claim of grant of privilege, to charge fees based on quid A
pro quo. The High Court in this case has merely reiterated the said
principles. It has held "that the Central Government has the exclusive
power to grant Excerpt shown. Read the full judgment & AI analysis in Lexace.