State intoxicating drugs regulation upheld where Presidential assent preserved the law and licensing restrictions were held valid.

A State law on intoxicating drugs, amended with Presidential assent under Article 254(2), was not displaced by the Central Drugs Act, 1940 because the Central statute stated that its provisions were in addition to other laws in force. The notification treating chloral hydrate as an intoxicating drug was upheld as a valid exercise of statutory power under the State Act, and the levy of a licence fee on its manufacture was found intra vires. The regulatory restriction was also sustained as a reasonable measure in the interests of the general public, so no infringement of Article 19 was made out and the writ petition failed.

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Issues: (i) Whether the State notification and the amended State law were invalid because the Central Drugs Act, 1940 occupied the field or impliedly repealed the State enactment; (ii) whether chloral hydrate could validly be notified as an intoxicating and narcotic substance under Section 2(4) of the Hyderabad Intoxicating Drugs Act; (iii) whether the levy of licence fee on manufacture of chloral hydrate was without power; and (iv) whether the notification infringed the right to carry on trade and business under Article 19.

Issue (i): Whether the State notification and the amended State law were invalid because the Central Drugs Act, 1940 occupied the field or impliedly repealed the State enactment.

Analysis: The State law had been amended and reserved for, and received, Presidential assent under Article 254(2) of the Constitution of India. Section 2 of the Drugs Act, 1940 declared that its provisions were in addition to, and not in derogation of, any other law for the time being in force. On that basis, the Central enactment did not exclude the operation of the State law, and no implied repeal or occupied-field contention could succeed.

Conclusion: The challenge on repugnancy and implied repeal failed, in favour of Revenue.

Issue (ii): Whether chloral hydrate could validly be notified as an intoxicating and narcotic substance under Section 2(4) of the Hyderabad Intoxicating Drugs Act.

Analysis: Section 2(4) empowered the Government to declare, by notification, any intoxicating and narcotic substance as an intoxicating drug. The Act contemplated a declaration based on governmental satisfaction, and the Court declined to adjudicate disputed questions of fact regarding the drug's effects. The record did not establish that the notification was outside the statutory power merely because the substance was said not to contain the listed narcotic ingredients in its finished form.

Conclusion: The notification validly treated chloral hydrate as an intoxicating drug, in favour of Revenue.

Issue (iii): Whether the levy of licence fee on manufacture of chloral hydrate was without power.

Analysis: Section 5 of the Hyderabad Intoxicating Drugs Act expressly empowered the Government to regulate the relevant matters and provide for supervision, licensing, and recovery of intoxicating drugs revenue. Since the State law continued to prevail, the levy of licence fee was within statutory authority.

Conclusion: The levy of licence fee was intra vires, in favour of Revenue.

Issue (iv): Whether the notification infringed the right to carry on trade and business under Article 19.

Analysis: Article 19(5) permits reasonable restrictions in the interests of the general public. The notification was directed to control the manufacture and misuse of the drug and was justified as a regulatory measure designed to protect the public interest.

Conclusion: No violation of Article 19 was made out, in favour of Revenue.

Final Conclusion: The statutory and constitutional challenges to the notification failed, and the writ petition was dismissed with costs.

Ratio Decidendi: A State law operating with Presidential assent under Article 254(2) is not displaced by a later applicable Central law where the Central enactment itself preserves other laws in force, and a regulatory notification issued under valid statutory power may impose licensing conditions and fees if those restrictions are reasonable in the public interest.

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