S. B. Slnha, J.

1. This application raises a question aa to whether the state is entitled to impose penal duty on the alleged was stage rectified spirit during transit which was unfit for human consumption. The petitioner has a distillery at Mirgang where rectified spirit i. e. spirit of 65.5 to 68.00 overproof strength containing 95% alcohol is manufactured which is unfit for human consumption. The petitioner has been granted exclusive privilege under section 22 of the Bihar and Orissa Excise Act (hereinafter referred to as the Act) for whole sale supply of rectified spirit to the Government warehouses situated in Bhojpur District.

2. Allegedly one tanker of spirit was despatched for three country spirit ware-bouses situated in Bhojpur district namely, Behea, Koransarai and Garhani in 3 different chambers of the tanker meant for the three aforesaid ware houses. According to the petitioner a leakage in the said tanker took place resulting in late arrival of the aforementioned tanker in the warehouses. According to the petitioner as there had been a purported transit wastage of 268.7 L. P. liters, by the Commissioner of Excise passed the impugned order dated 21-7-1981 as contained in Annexure-1 to the writ application. The petitioner moved the Member of the Board of Revenue against the said order who by reason of hia order dated 9-2-1983 as contained in Annexure-2 dismissed the petitioners application.

3. In this case a counter affidavit has been filed stating Inter alia therein that as the tanker took long time to reach its destination from Muzaffarpur where the same was loaded, suspicion arose and the matter was inquired into. It has been contended that in terms of sub-rule (4) of Rule 33 of the Rules framed under the said Act, the Collector of the district was the competent authority to realise penal duty and in this case the Superintendent of Excise, bhojpur has taken action to realise the said duty on behalf of the Collector. The order of the superintendent of Excise, Bhojpur, was affirmed by the commissioner of Excise, It has been accepted in the said counter affidavit that the strength of the rectified spirit manufactured by the petitioner varied between 65.0 to 68.0 O. P, but according to the respondents, the same was being transported for the purpose of sale as potable spirit and the spirit manufacture by the petitioner was meant for human consumption.

4. Mr. G. P. Bimal, learned counsel for the petitioner has raised a short question in support of this application. The learned counsel submitted that as the licence was granted in favour of the petitioner in Form 28-A in terms of Sec.13 of the said Act, the same should to be used for Chemicals industrial, scientific and other purposes ; the State had no jurisdiction to levy any duty in view of the fact that rectified spirit would come within the perview of Entry-84 of Schedule-1 of the Constitution of India, and not real entry No.51 of List-11 thereof.

5. The learned counsel in support of his contention had strongly relied upon a Division Bench decision of this court in. New Swadeshi Sugar Mills ltd. y. State of Bihar, reported in 1983 PUR 105 : 1983 BLJ 526 and a decision of the Supreme Court reported in Synthetics and Chemicals and others ltd. V/s. State of U. P. and others, 1990 Vol. I. SCC 109. In New Swadeshi Sugar Mills Ltd. A Division Bench of this Court has held as follows:

"licence in form Nos.27 and 28 are granted under Sections 20 and 22 of the Act respectively for the wholesale of country spirit which is undoubtedly for human consumption. In both these forms provision has been made for payment of duty by execution of bonds, From the conditions of the licence, Form 28-A, therefore, it cannot be said that the petitioners company was required to execute bond and pay any duty. " Sec.12 of the Act provides that no intoxicant can be imported or transported except under a pass and Sec.13 provides for licence for manufacture for intoxicant under the authority