- (1.) BY this writ petition filed under Art. 226 of the Constitution,the petitioner has prayed that a writ of mandamus or any other appropriate writ, order or direction be issued to the respondents striking down a part of s. 3 (4) (1) of the Rajasthan Excise Act, 1950 (for short 'the Act') to the extent it includes denatured spirit and denatured spirituous preparation within the definition of excisable articles being ultravires of the Constitution and being beyond the legislative competence of the State Legislature and further striking down that part of the provisions of ss. 41 and 42 of the Act to the extent it purport to enact any provision conferring any powers on any of the respondents with respect to denatured spirit or denatured spirituous preparation whether it be imposing restrictions or regulating import, export, transport or possession or prescribe any fees for any licence, permit fees or pass etc. The petitioners further claim striking down a part of the provisions of s. 28 of the Act to the extent it purports to authorises the State Govt. to impose on levy any Excise Duty or countervailing duty on denatured spirit or denatured spirituous preparation and striking down any notification that may have been issued by any of the respondents imposing any such Excise Duty or countervailing duty on denatured spirit or denatured spirituous preparation. The petitioners have also prayed for striking down the provisions of r. 69-B of the Rajasthan Excise Rules, 1956 (hereinafter referred to as 'the Rules") to the extent it purports to levy or prescribe any permit fee on import or export or transport of any denatured spirit or denatured spirituous preparation. It was prayed that the Gazette Notification (Annexure-2) dated 16. 3. 1987, the permit (Annexure -3) dated 13. 3. 1989 and the letter (Annexure-4) dated 10. 4. 1989 be quashed and the respondents be restrained from enforcing any levy or recovery of any amount from the petitioners in the name of excise duty or countervailing duty or permit fees for import or export with respect to any denatured spirit or Thinner or denatured spirituous preparation.
(2.) THE facts necessary for the disposal of this writ petition briefly stated are: that petitioner No. 1 M/s Geeta Enterprises is a partnership firm and petitioner No. 2 Shri Mukesh Rahlan is its Manager. THE petitioner firm was established in the year 1988 at Bhiwadi for the manufacture and sale of Thinner after obtaining a licence from the District Excise Officer, Bharatpur. It is alleged that in the manufacture of Thinner, the denatured spirit is used as a raw material and, therefore, the petitioner has to import denatured spirit from the surplus State like U. P. and after the manufacture of the Thinner, it has to sell it outside Rajasthan i. e. in Delhi and U. P. THE respondents by virtue of s. 28 of the Act claimed that they have the power to impose or levy excise duty or countervailing duty on import and possession of industrial alcohol i. e. denatured spirit. THEy have further claimed that they have the power to recover excise duty and countervailing duty as also permit fee etc. not only on the import of the denatured spirit but also on the export of the Thinner because denatured spirit has been included in the definition of the excisable article as per s. 3 (4) (1) of the Act. According to the petitioners, the State Govt. has imposed excise duty and countervailing on the denatured spirit and denatured spirituous preparation @ Rs. 1. 40 P. per litre when consumed in the State and at Rs. 0. 65 P. per litre when exported out of the State. It has also imposed permit fee of Rs. 2/- per litre on denatured spirit and for its import and Rs. 2/- per litre for the export of the denatured spirituous preparation. It was, therefore, submitted by the petitioners that the petitioner firm, which produces Thinner with the denatured spirit as a raw material, has to pay an additional cost- of Rs. 6. 05 P. per litre as excise duty and countervailing duty as also permit fee (Rs. 2/-pcr litre as permit fee for the export and Rs. 2/- per litre as permit fee for the import and Rs. 1. 40 P. per litre as excise duty for the consumption of the" denatured spirit in the State for the manufacture of the Thinner and Rs. 0. 65 P. per litre as Excise duty for the export of the denatured spirituous preparation ). It was submitted that the denatured spirit being an industrial alcohol, the State Govt. or for that matter, the Excise Commissioner has no powers to impose any fee or duty on it in exercise of the powers conferred upon them under ss. 41 and 42 read with s. 28 of the Act keeping in view the definition of excisable articles as mentioned in s. 3 (4) of the Act. It has also no such powers to prescribe any pernit fee under r. 69-B of the Rules as amended from time to time. It was further, submitted that Entry 84 of List I of Schedule VII of the Constitution as also Entry 51 of the Slate List authorises that State Govt. to levy excise duly on alcoholic liquors for human consumption only. According to the petitioners, the denatured spirit is being consumed by it for the manufacture of the Thinner and as such, the* State Govt. has no authority to levy any duty or fees on it, for its industrial use. According to the petitioner-firm, it obtained the permit. Annexure-3 for importing 9,000 litres of denatured spirit for the manufacture of the Thinner and on that denatured spirit, the aforesaid excise and countervailing duty as also permit fees are being charged. In this connection, the petitioners have placed reliance on a decision of this Court in Shri Mahalaxmi Paints Industries vs. State of Rajasthan & Ors. (S. B. Civil Writ petition. No. 1688 of 1976, decided on 17. 3. 1979), wherein such a recovery of duty and fee has been held to be unconstitutional: It is alleged that against that decision, a special appeal has been filed by the State Govt. and (hat too bearing D. B. Civil Special Appeal? No. 116 of 1979 came to be decided by a Division Bench of this Court vide its Judgment dated 21. 3. 1986 and it was held that: such a levy is illegal and unconstitutional. That decision has been upheld by their lordships of the Supreme Court. It was, therefore, submitted that the respondents are not entitled to make any recovery from the amount of the guarantee. furnished by them as regards payment of fee and excise and countervailing duly. Reference has also been made to S. B. Civil Writ Petition Nog. 344 of 1983 and 2804 of 1986 filed by one Shatish Kumar Sethi and the decisions rendered thereon. According to the petitioners, they have also filed one writ petition bearing No. S. B. Civil Writ Petition No. 4088 of 1989, M/s. Geeta Enterprises vs. " State, which came to be- decided by a learned single Judge of. this Court vide his Judgment dated 5. 5. 1992 whereby the levy of excise duty has not been challenged and, therefore-, without going into that question, it was held that the levy of permit fee is not unconstitutional and the writ petition was dismissed. A special appeal was filed against that decision, which was registered as D. B. Civil Special. Appeal No. 432 of 1992. This appeal was filed on 13. 7. 1992. On 19ill. l992, learned counsel for the petitioner sought to. withdraw the original writ petition itself with liberty to file a fresh writ petition and, therefore, the writ petition was dismissed as withdrawn and since the writ petition has been withdrawn, the special appeal filed against the decision passed in the writ petition was also disposed of accordingly.
(3.) IT was contended that since the writ petition bearing No. S. B. Civil Writ Petition No. 4088 of 1989 only comprehended the controversy regarding denatured spirit as referred to in Annexure-4 and since the demand of permit fee and excise duty was also raised on Thinner on the ground of its being denatured spirituous preparation and as during the pendency of that writ petition, the petitioner was advised to file another writ petition being Writ Petition No. 5416 of 1991 M/s. Geeta Enterprises & Another vs. State inter alia, seeking a direction restraining the respondents from realising or recovering any excise duty on denatured spirit and Thinner as also seeking to restrain them from realising and recovering permit fees on denatured spirit or Thinner on import or export, so also seeking a direction for the refund of Rs. 18,000/- with interest. IT is alleged that in both these writ petitions, the validity of the provisions of Ss. 28,41, and 42 of the Act as also the provisions R. 69-B of the Rules were not challenged. The writ petition bearing No. S. B. Civil Writ Petition No. 5416 of 1991 was also withdrawn with liberty to file a fresh writ petition on 19. 11. 1992 whereas the present writ petition has been filed on 28. 10. 1992, although show cause notices were ordered to be issued to the respondents on 19. 11. 1992. The case of the petitioners is that industrial alcohol is a central subject and after the 1956 amendment to the IDR Act, bringing alcohol industries (under fermentation industries) as item No. 26 of the First Schedule to FOR Act, the control of this industry has been vested exclusively in the Union. The State can neither rely on Entry 8 of List II nor Entry 33 of List III as a basis for such a claim. The State cannot claim that under Entry 33 of List III, it can regulate industrial alcohol as a product of the scheduled industry, because the Union, under S. 18-G of the IDR Act, has evinced clear intention to occupy the whole field. It was, therefore, claimed that all these provisions, which authorise the State Govt. to prescribe or levy excise duty or countervailing duty or any fee on the industrial alcohol either under S. 28 of the Act or under S. 41 of the Act arc ultra varies of the Constitution. Even the Excise Commissioner in exercise of his powers under S. 42 of the Act cannot prescribe such a levy of duty or fee. The provisions of R. 69-B of the Rules cannot be used for prescribing or levying such a duty or fee because it is beyond the legislative competence of the State Govt. and, therefore, it has been prayed that all these provisions be struck down to that extent and Annexures 2 and 4 be quashed. A reply to the writ petition has been filed on behalf of the respondents, in which, it has been contended that in the writ petition, reference has been made to two earlier writ petitions filed by the petitioners bearing No 4088 of 1989 and 5416 of 1991. The writ petition bearing No. 4088 of 1989 was dismissed by a learned single Judge of this Court vide his order dated 5. 5. 1992 holding that the permit fee can be charged. Against that decision, a special appeal bearing D. B. Civil Special Appeal No. 432 of 1992 was filed and prayed for a stay but that prayer for the grant of stay was rejected by this Court vide its order dated 27. 8. 1992. According to the respondents, detailed reasons have been mentioned in the Judgment of this Court dated 5. 5. 1992 about rejection of the writ petition and, therefore, the present writ petition is not maintainable. According to the respondents, the other challenges which have now been made by the petitioner in this writ petition were not raised in the earlier writ petitions and, therefore, now, the petitioners cannot be permitted to raise these questions on the basis of the principle of constructive res-judicata. ;