1997 (9) TMI 128

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....sation is granted by the Commissioner of Uttar Pradesh. The petitioner sells, its product both for industrial use as also for manufacturing potable liquor. On 21st March, 1995 at about 10 p.m. the Distillery Manager was informed that rectified spirit is flowing outside of storage warehouse of the Distillery. The Distillery Manager and other officials immediately rushed to the spot but due to lock of storage of the warehouse immediately check on flowing of spirit could not be taken. The said warehouse was locked by the Excise Inspector In-charge of Distillery and the keys of all the locks were with him. The Excise Inspector came to the Distillery at about 12.30 p.m. and opened the lock and repair work was done of the storage tank from which ....

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....akage or stock wastage 36,512,3 alcohol litres. It was alleged that there was loss of revenue due to such leakage. The same was calculated at Rs. 45/- per alcohol litre on the wastage of 34,124.3 alcohol litres amounting to Rs. 15,35,593.50 P. The said loss of revenue was estimated to be the loss which was likely to be incurred by conversion of rectified spirit amounting to Rs. 36,512,3 per alcohol litres for potable purposes. It was stated that the quantity of rectified spirit which was lost was due to sheer negligence of the appellant and the same was likely to be used for the manufacture of Indian made foreign liquor. In that view of the matter, the petitioner was asked to pay a sum of Rs. 15,35,593.50 by way of loss of revenue. 4.The....

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.... which is not fit for human consumption cannot be a subject matter for levying any duty for the State authority. On the issue of the rectified spirit or alcoholic liquor for human consumption several decisions of the Supreme Court has extensively dealt with the matter. Such as Synthetic Chemicals Ltd. v. State of U.P. & Others, reported in 1990 (1) SCC 109; State of U.P. & Others, v. Modi Distillery etc., JT 1995 (6) SCC 523; Vam Organic Chemicals Ltd. v. State of U.P. & Others, reported in 1997 (2) A.W.C. 984 and Bihar Distillery & Another v. Union of India & Others, reported in 1997 (2) A.W.C. 879. 6.From a perusal of these decisions it is made clear that upto the stage of the rectified spirit which is not fit for human consumption the....