Monday, Nov 24, 2003
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By J. Venkatesan
The Bench, by a majority of 3:2, held that the fee levied was for the privilege given to the licensee for import of liquor and such imposition "does not in any way, restrict trade, commerce and intercourse among the States." In this case the judges upheld such a levy by the Punjab Government and allowed its appeal.
The majority judgment was by the Chief Justice V.N. Khare, Justice R.C. Lahoti and Justice A.R. Lakshmanan and the differing judgment was given by Justice B.N. Agrawal and Justice S.B. Sinha.
Speaking for the majority, Justice Lakshmanan said, "it is well settled by a catena of decisions that the trade in liquor is not a fundamental right. It is a privilege of the State. The State parts with this privilege for revenue consideration."
He said a perusal of the impugned notification showed that the State Government had substituted the existing provision with regard to import fee and increased the rate of this fee.
"It is part of the privilege price, consideration amount on account of which the licence was granted to the licensee. Further, the licensee had an option to opt out of the business field if such levies were detrimental to their interest or were to their disadvantage," Justice Lakshmanan said.
He said the State Government had unfettered powers to regulate the export/import sale of intoxicants and in exercise of its regulatory power the import fee had been incorporated as one of the terms of the excise policy on yearly basis.
On the contention that such a levy infringed on the right to trade, he said, "the permissive privilege to deal in liquor is not a "right" at all.
The levy charged for parting with that privilege is neither a tax nor a fee. It is simply a levy for the act of granting permission or for the exercise of power to part with the privilege."
The Bench held that Articles 301 to 304 of the Constitution (relating to trade, commerce and intercourse within the territory of India) were not violated or transgressed and were not applicable in this case which arose against a judgment of the Punjab and Haryana High Court.
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