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IN THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH AT JAMMU Reserved on 18.12.2024 Pronounced on 31.12.2024 .
WP(C ) No. 3273/2019 …Petitioner(s)/Appellant(s)
M/S Cadila Pharmaceuticals Ltd. Phase-I Industrial Growth Centre, Samba Vs
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 2257/2019 M/S Ind Swift Laboratories Ltd Industrial Growth Cwentre, Samba Vs
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 2658/2019 Bari Brahamana Industrial Association, BBIA Bhawan, SIDCO Industrial Complex, Bari Brahamana Jammu Vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner.
WP(C ) No. 2992/2019 Zeiss Pharma Limited Phase-II IGC Sidco Samba Vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 2993/2019 Anphar Laboratories Pvt. Ltd Industrial Extension Area Phase III Gangyal Jammu Vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No.3000/2019 Pharose Remedies Ltd. 2nd Milestone, Patli Morh, Tarore, Bari Brahamana Vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3211/2019 Emcure Pharmaceuticals Limited,Lane No.3, Phase-II, Sidco IndustrialComplex,Baribrahamana, VS
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3361/2019 M/S UPL LTD. Phase-I Industrial Growth Centre, Samba VS
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3362/2019 RITZY POLYMERS A Partnership Firm under the Partnership Act,1932 Having its unit(s) at Chemical Zone, Industrial Growth Center,Phase-1,Samba,Jammu Vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3414/2019 MEDLEY PHARMACEUTICALS LTD. lane No.3, Phase-I, Sidco Industrial Complex, Baribrahamana, Jammu.
vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3448/2019 M/S OPTIMA FARM SOLUTIONS LTD. Phase-! Industrial Growth Centre, Samba vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3451/2019 MONTAGE ENTERPRISES PVT. LTD. Lane No.4, Phase-I, Sidco Industrial Complex,Bari Brahmana, Jammu.
vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3470/2019 ETHICARE LABORATORIES 15 Industrial Estate, Digiana, Jammu vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3479/2019 ACCENT PHARMA Block D, EPIP, Sidco, Kartholi II Bari Brahamana, Jammu vs
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur STATE WP(C ) No. 3532/2019 ZUVENTUS HEALTHCARE LIMITED Lane No.3, Phase- II,Sidco Industrial Complex, Baribrahamana,Tehsil and District, Samba vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3604/2019 M/S AGRO LIFE SCIENCE CORP. IID Centre, Plot No. 166-
173A,Govindsar District Kathua vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3664/2019 UFLEX LIMITED UNIT II Lane No.2, Phase-1, Sidco Industrial Complex, Bari Brahmana, Jammu vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3687/2019 RITZY POLYMERS A Partnership Firm under the Partnership Act,1932Having its unit(s) at Chemical Zone, Industrial Growth Center,Phase-1,Samba,Jammu vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3704/2019 M/S KRISHI RASAYAN EXPORT PVT. LTD. 1st Parallel Road, IGC,District Samba vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2. Excise Commissioner, J&K Government, Excise Department, Jammu
3.Director, Industries, Jammu
4. Deputy Excise Commissioner, Jammu
5.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 3858/2019 UFLEX LIMITED UNIT III Lane No.3, Phase-1, Sidco Industrial Complex, Bari Brahmana, Jammu vs.
1. State of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 State of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur WP(C ) No. 4412/2019 VIVEK PHARMACHEM INDIA LIMITED EPIP Baribrahamana, Jammu.
vs.
1. UT of Jammu and Kashmir through Commissioner Secretary to Government, Finance Department.
2 UT of J&K through commissioner/Secretary Industries and Commerce Department.
3.J&K Excise Department through Excise Commissioner
4.Deputy Excise Commissioner, Lakhanpur For Mr. Pranav Kohli Sr. Advocate with petitioners: Mr. Arun Dev Singh Advocate Mr. Amar Pratap Singh Advocate Mr. Vishal Goel Advocate. Mr. J. A Hamal Advocate.
Mr. Aftab Malik Advocate.
For respondents:
Ms Monika Kohli Sr. AAG CORAM:
HON’BLE MR. JUSTICE SANJEEV KUMAR, JUDGE HON’BLE MR. JUSTICE PUNEET GUPTA, JUDGE
J U D G M E N T
Sanjeev Kumar J
1 The petitioners in all these petitions are entrepreneurs who have established their industrial units in the UT of Jammu and Kashmir. Some of these units are engaged in the manufacturing of medicinal and toiletry preparations, whereas the others manufacture various products out of the raw materials, such as absolute alcohol/denatured spirit/special denatured spirit/rectified spirit/plain spirit, etc. They are aggrieved of and have challenged sub-clause (B) of Clause 14 “Excise Duty-Civil” of Excise Policy 2019-20 [“Excise Policy 2019-20”] to the extent it provides for the levy of excise duty at the rate of Rs. 10 per litre in respect of rectified spirit/alcohol and denatured spirit used in medicinal and toiletry preparations, other than in manufacture of liquor.
2 The impugned clause of the Excise Policy 2019-20, promulgated vide SRO 128 dated 25.02.2019, is challenged primarily on the ground that the then State of Jammu and Kashmir, as it was before the promulgation of the J&K Reorganization Act, 2019, did not have the legislative competence to impose a levy of excise duty on the rectified spirit etc. for use in medicinal and toiletry preparations and also that the raw material procured by the petitioners i.e rectified spirit etc., is exigible to Goods and Services Tax (GST) under Integrated Goods and Services Act 2017 and, therefore, levy of duty of excise on the same product amounts to double taxation, which is not permissible in law.
3 The writ petitions are opposed by the State (now UT of Jammu and Kashmir) on the ground that the alcoholic liquor/alcohol falls within the legislative competence of the State, in that, prior to the abrogation of Article 370 of the Constitution of India, all residuary legislative powers were vested in the erstwhile State of Jammu and Kashmir. It is submitted that Entry 84 of the Union list, as recast by virtue of the Constitution (One hundred and First Amendment), 2016, does not make any mention of the rectified spirit/denatured spirit used in medicinal and toiletry preparations. It is further submitted that Entry 84 of the Union list is not applicable to the cases on hand. It is pleaded in the reply affidavit filed by the respondents that the State legislature derived its power to legislate on the excise duty under Section 5 of the Constitution of Jammu and Kashmir. To sum up their response, the respondents have submitted that, with the implementation of the Goods and Services Tax Act as applicable to the State of Jammu and Kashmir on 07.07.2017, the J&K VAT Act, J&K Entry Tax on Goods Act, 2000, J&K Entertainment Tax Act, 1962 and J&K Entertainments Duty Act, 2016 came to be repealed. J&K Excise Act, 1958 [“State Excise Act”] which was enacted by the then State of Jammu and Kashmir, remained intact and that it is in the exercise of powers conferred by the State Excise Act, the impugned clause in the Excise Policy of 2019-2020 has been framed.
4 Having heard learned counsels for the parties and perused the material on record, it is necessary to first advert to the Excise Policy 2019-20 promulgated vide SRO 128 dated 25-02-2019 and the impugned clause 14 (B) thereof. The impugned clause reads thus:
14. Excise Duty: -CIVIL A…………………………..
B Rectified spirit, alcohol, denatured spirit and molasses
Type
Rate
Rectified spirit/alcohol/denatured spirit for use in medicinal and toiletry preparations,
Rs.10/litre
other than in manufacture of liquor
Molasses
Rs.20 per quintal
5 SRO 128 (supra) professes to promulgate the Excise Policy
2019-20, which was to come into force on 26.02.2019 and to remain in force till 31.03.2020. The policy, as is apparent from reading of its objectives, was issued to simplify the regulatory structure by rationalizing and reducing the number of taxes, duties and other levies, thereby maximizing revenue realization. It also aimed to promote greater social consciousness about the harmful effects of consumption of liquor
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