Constitutional validity of excise duty on medicinal preparations upheld as non-arbitrary and not violative of fundamental rights.

Levy of 4% ad valorem duty on medicinal preparations containing self-generated alcohol under clause 2(i) of the Schedule to the Medical and Toilet Preparations (Excise Duties) Act, 1955 was upheld as constitutionally valid. The Court held that a taxing provision is not invalid merely because a higher rate is introduced after a period of nil duty, and no implied exemption can be inferred from prior non-levy. It further found no violation of Articles 14 or 19(1)(g), noting that comparable medicinal preparations were already subject to higher duty and that the impugned levy was neither arbitrary nor excessive.

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Issues: Whether the levy of 4% ad valorem duty on medicinal preparations containing self-generated alcohol under clause 2(i) of the Schedule to the Medical and Toilet Preparations (Excise Duties) Act, 1955 is unconstitutional as being arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution of India.

Analysis: The charging provision under Section 3 authorises levy of duties at the rates specified in the Schedule, and the challenge was confined only to the revised rate under clause 2(i). The Court held that a taxing provision is not invalid merely because a higher rate is introduced after a period of nil duty, and that no implied exemption can be presumed from earlier non-levy. The petitioner did not assail legislative competence, and no violation of fundamental rights was established. The Court also noted that comparable medicinal preparations containing alcohol were subjected to higher rates of duty, showing that the impugned 4% levy was neither arbitrary nor excessive.

Conclusion: The levy of 4% ad valorem duty under clause 2(i) of the Schedule is valid and not violative of Articles 14 or 19(1)(g); the challenge fails.

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