Case: State Of U.P. & Ors vs M/S Lalta Prasad Vaish
Date of / Judgment: October 23, 2024
Bench: 9(8:1) Judges
Majority: CJI Justice DY Chandrachud, Justice Hrishikesh Roy, Justice Abhay S. Oka, Justice B.V. Nagarathna, Justice J.B. Pardiwala, Justice Manoj Misra, Justice Ujjal Bhuyan, Justice Satish Chandra Sharma And Justice Augustine George Masih
Dissent: Justice Nagarathna
Background
The case involves the interpretation of "intoxicating liquor" within the legislative framework of the Constitution of India, particularly Entry 8 of List II of the Seventh Schedule. This Entry grants State Legislatures the power to regulate intoxicating liquor, encompassing its production, possession, and sale. The key issue was whether this term includes only potable alcohol or also industrial alcohol used in various products. The other questions were also involved, notably the judgment in Synthetics and Chemicals Ltd. v. State of U.P., which had mixed definitions and implications regarding "industrial alcohol" and "rectified spirit."
The appellants argued that the earlier decision wrongly mixed industrial alcohol with potable alcohol, and they urged the court to clarify the definitions and scope of regulatory powers under Entry 8. The Union contended that its control over industries, including intoxicating liquor, allowed for comprehensive regulation at all three stages ranging from production to trade.
Issues
- 1. Whether the interpretation of the term "intoxicating liquor", under Entry 8 of List II (State List) of the Seventh Schedule also includes “industrial alcohol” or, would fall under Entry 52 of List I (Union List) which relates to the regulation and control of Union over the “industry”.
- 2. The legislative competence of both State and Central Governments under the relevant Entries of the Constitution.
- 3. Whether the earlier decision in Synthetics and Chemicals Ltd. requires re-evaluation in light of the regulatory framework provided by the IDR Act and constitutional provisions.
Observation
The Supreme Court, in its ruling, observed that:
- • Entry 8 of List II is both industry-based and product-based, allowing for regulation that extends beyond just alcoholic beverages to include various forms of alcohol.
- • The Parliament cannot usurp the entire regulatory domain of intoxicating liquor merely through a declaration under Entry 52 of List I.
- • The term "intoxicating liquor" should be understood broadly, encompassing not only substances intended for human consumption but also those that may have intoxicating effects or health risks if misused.
- • The ruling of the Court in Tika Ramji was also questioned, but the Court found the Judgment to be not directly related to the issues involved in the present case.
Justice Nagarathna, dissenting, emphasized that industrial alcohol should not be classified as "intoxicating liquor" as it is not fit for human consumption. Her Ladyship argued for a more restrictive interpretation that aligns with the framers' intentions.
Decision
The Court concluded that:
- 1. Entry 8 of List II allows for comprehensive regulation of intoxicating liquor, including various alcohol types used in both production and consumption contexts.
- 2. The Synthetics and Chemicals Ltd. ruling was overruled, clarifying that industrial alcohol can be considered under the broader definition of "intoxicating liquor" as it pertains to public health concerns.
- 3. The provisions of the The Industries(Development and Regulation) Act, 1951 should be interpreted as excluding the industry of "intoxicating liquor" from its scope.
- 4. The findings reinforced that the legislative entries regarding alcohol were intentionally crafted to account for both potable and non-potable forms, ensuring state regulation remains effective for public welfare.