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2017 Supreme(MP) 1068
IN THE HIGH COURT OF MADHYA PRADESH (GWALIOR BENCH)
HEMANT GUPTA, CJ, SANJAY YADAV, J.
STATE OF MADHYA PRADESH - Appellant
Vs.
M/S. PERNOD RICARD INDIA (P) LTD. - Respondent
W.A. No. 425 of 2016
Decided On : 29-06-2017
Advocate Appeared:
For the Appellants : Shri Ajay Kumar Sharma, Assistant Commissioner, Excise, Gwalior, Officer-in-Charge.
The main legal principle established in the judgment is that the amendment to a rule or statute will operate prospectively unless specifically made retrospective, and the imposition of penalties is a matter of substantive rights, not procedure.
Headnote:
M.P. Excise Act - Sub-licensee - Rule 16, Rule 19 - The court discussed the provisions of Rule 16 and Rule 19 of the M.P. Foreign Liquor Rules, 1996, which deal with permissible limits of losses during transportation and imposition of penalties for deficiencies, respectively. The court interpreted the applicability of these rules to determine the rights and liabilities of the sub-licensee and the imposition of penalties.
Fact of the Case:
The writ-petitioner, a sub-licensee under the M.P. Excise Act, 1915, was involved in the manufacture and sale of Indian-made foreign liquor. The case revolved around the shortage in the consignment and the imposition of penalties under Rule 19 of the M.P. Foreign Liquor Rules, 1996.
Finding of the Court:
The court found that the amendment to Rule 19(2) was not applicable to the relevant license year of 2009-10, and therefore, the penalty was imposable in accordance with the rule applicable for that year. The court set aside the order passed by the learned Single Bench, allowing the writ appeals.
Issues: The main issue was the applicability of Rule 19(2) of the M.P. Foreign Liquor Rules, 1996, and whether the penalty should be imposed in accordance with the rule applicable during the relevant license year.
Ratio Decidendi: The court held that the amendment to Rule 19(2) would operate prospectively and not retrospectively, and therefore, the penalty for the relevant license year should be determined based on the rule applicable at that time.
Final Decision: The court set aside the order passed by the learned Single Bench and allowed the writ appeals in favor of the appellants-State.
Hemant Gupta, CJ.
This order shall dispose of bunch of appeals bearing Writ Appeal Nos. 425/2016, 6/2017, 7/2017, 8/2017, 9/2017, 10/2017, 11/2017, 12/2017, 13/2017, 14/2017, 15/2017, 16/2017, 17/2017, 19/2017, 20/2017, 21/2017, 22/2017, 23/2017, 24/2017, 25/2017, 26/2017, 27/2017, 28/2017, 29/2017, 30/2017, 31/2017, 32/2017, 33/2017, 34/2017, 35/2017, 36/2017, 37/2017, 38/2017, 39/2017, 40/2017, 41/2017, 42/2017, 43/2017, 87/2017 and Writ Appeal No. 100/2017 arising out of a common order dated 01.12.2015 whereby the writ petitions were allowed and the orders dated 22.11.2011, 02.05.2013 and 10.05.2013 passed by the Deputy Commissioner, Excise, Gwalior; Commissioner, Excise and the Board of Revenue respectively were set aside. The question of fact and law is common in all these appeals.
2. The issue is short. The writ-petitioner is a sub-licensee as per the provisions of the M.P. Excise Act, 1915 (fort short "the Act"). The writ-petitioner is a manufacturer of Indian-made foreign liquor. The sale of foreign made liquor is governed by M.P. Foreign Liquor Rules, 1996 (for short "the Rules"). Rule 16 of the said Rules deals with the permissible limits of losses sustained during transportation of the foreign liquor whereas Rule 19 of the Rules deals with imposition of penalty if liquor is found short at the destination point as compared to the quantity, which was sent.
3. The relevant year of sub-licence is the year 2009-10. The relevant provisions of the Rules, as were existing in 2009-10, read as under :-
"16. Permissible Limits of Losses.- (1) An allowance shall be made for the actual loss of spirit by leakage, evaporation etc., and of bottled foreign liquor by breakage caused by loading, unloading, handling etc. in transit, at the rate mentioned hereinafter. The total quantity of bottled foreign liquor transported or exported shall be the basis for computation of permissible losses.
(2) Wastage allowances on the spirit transported to the premises of F.L. 9 or F.L. 9A licensee shall be the same as given in sub-rule (4) of rule 6 of the Distillery Rules, 1995.
(3) Maximum wastage allowance for all exports of bottled foreign liquor shall be 0.25% irrespective of distance.
(4) Maximum wastage allowance for all transports of bottled foreign liquor shall be 0.1% if the selling licensee and the purchasing licensee belong to the same district. It shall be 0.25% if they belong to different districts."
19. Penalties. - (1) Without prejudice to the provisions of the Act, or condition No. 4 of licence in form F.L. 1, condition No. 7 of licence in Form F.L. 2, condition No. 4 of licence in form F.L. 3, the Excise Commissioner or the Collector may impose a penalty not exceeding Rs. 50,000 for contravention of any of these rules or the provisions of the Act or any other rules made under the Act or the order issued by the Excise Commissioner.
(2) On all deficiencies in excess of the limits allowed under Rule 16 and Rule 17, the F.L. 9 or F.L. 9A, F.L. 10-A or F.L. 10-B licensee shall be liable to pay penalty at a rate exceeding three times but not exceeding four times the maximum duty payable on foreign liquor at that time, as may be imposed by the Excise Commissioner or any officer authorised by him :
Provided that if it be proved to the satisfaction of the Excise Commissioner or the authorised officer that such excess deficiency or loss was due to some unavoidable cause like fire or accident and its first information report was lodged in Police Station, he may waive the penalty imposable under this sub-rule.
(3) The Excise Commissioner or the Collector may suspend or cancel the licence under Section 31 of the Act upon a contravention of any of these rules or provisions of the Act, or any other rules made under the Act, or the orders issued by the Excise Commissioner."
4. The explanation of the writ-petitioner for shortage in the consignment was that if on account of any accident there is any loss, the sub-licensee cannot be burdened with the pen
