{"id":191584,"date":"2011-09-23T00:00:00","date_gmt":"2011-09-22T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011"},"modified":"2016-07-07T11:41:11","modified_gmt":"2016-07-07T06:11:11","slug":"state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","title":{"rendered":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011"},"content":{"rendered":"
Supreme Court of India<\/div>\n
State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011<\/div>\n
Author: R V Raveendran<\/div>\n
Bench: R.V. Raveendran, P. Sathasivam<\/div>\n
                                                                                        Reportable \n\n                     IN THE SUPREME COURT OF INDIA\n\n\n                      CIVIL APPELLATE JURISDICTION\n\n\n                   CIVIL APPEAL NOs. 4708-4709 OF 2002\n\n\n\n\nState of U.P. & Ors.                                                ... Appellants\n\n\nVs.\n\n\nM\/s Mohan Meakin Breweries Ltd. & Anr.                              ... Respondents\n\n\n\n\nWith\n\n\nCivil Appeal No.4710 of 2002\n\nCivil Appeal No.4711 of 2002\n\nCivil Appeal No.4712 of 2002\n\nCivil Appeal No.4713 of 2002\n\n\n\n\n                                  J U D G M E N T\n<\/pre>\n
R. V. Raveendran J.\n<\/p>\n<\/p>\n
        Civil Appeal Nos.4708-4709 of 2002 are filed   by the State of Uttar <\/p>\n
Pradesh aggrieved by the common order dated 15.3.2002 of the Allahabad <\/p>\n
High Court allowing CMWP No.3968 of 1978 and CMWP No.4043 of 1978 <\/p>\n
filed   by   two   Breweries.   Civil   Appeal   Nos.4710,   4711,   4712   and   4713   of <\/p>\n
2002 are filed by the Breweries aggrieved by the said common order dated <\/p>\n
15.3.2002, dismissing their writ  petitions – CMWP Nos.1375 of 1978, 3690 <\/p>\n
                                              2<\/span><\/p>\n
of   1979,   4136\/1978   and   4157\/1978.   The   appeals   by   the   state   relate   to <\/p>\n
imposition   of  duty   and   additional   duty   on   excess   wastage   in   the   brewery. <\/p>\n
The   appeals   by   the   Breweries   relate   to   imposition   of   duty   and   additional <\/p>\n
duty on excess bottling wastage.\n<\/p>\n
Civil Appeal No.4708 of 2002<\/p>\n
2.     The first respondent (for short the `Brewery’) held  a Brewery Licence <\/p>\n
issued under section 18(c) of the Uttar Pradesh Excise Act, 1910 (`Act’ for <\/p>\n
short) in Form-B1 and a Bottling Licence for bottling liquor for sale issued <\/p>\n
under section 17(1)(d) of the Act  in Form FL-3. The Brewery was carrying  <\/p>\n
on  the manufacturing  of beer  and bottling  of  beer in  bond, under the  said  <\/p>\n
Licences.\n<\/p>\n<\/p>\n
3.     The Excise Inspector in-charge of the Brewery maintains a Register of <\/p>\n
manufacture   and   issue   of   beer   in   Form   B-16.   The   Excise   Inspector   is <\/p>\n
required to examine the accounts of the brewery and take stock of the beer in <\/p>\n
hand in the brewery, on the last working day of every calendar month (prior <\/p>\n
to 19.7.1975, such examination was required to be done at the end of each <\/p>\n
quarter) after all the issues for that day are made. If he found that the actual <\/p>\n
quantity of beer in stock in the brewery was less than the quantity shown in  <\/p>\n
                                               3<\/span><\/p>\n
the stock account, but the deficiency did not exceed 9%, he had to disregard <\/p>\n
the   same   as   allowance   upto   9%   was   permitted   to   cover   the   losses   due   to <\/p>\n
evaporation,   sullage   and   other   contingencies.   But   where   the   deficiency <\/p>\n
exceeded 9%, he was required to enquire into the cause and submit a report <\/p>\n
of the result to the Excise Commissioner in that behalf. The Excise Inspector <\/p>\n
in-charge,   was   accordingly   sending   reports   to   the   Excise   Commissioner <\/p>\n
whenever   there   was   excess   wastage   in   the   case   of   the   first   respondent <\/p>\n
brewery.   The   Excise   Commissioner   issued   show-cause   notice   giving <\/p>\n
opportunity to the Brewery to explain the excess wastage. After considering <\/p>\n
the   explanation,   the   Excise   Commissioner   found   that   there   was   no <\/p>\n
satisfactory   explanation   and   made   ten   orders   between   26\/28.6.1966   and <\/p>\n
24.11.1973   in   regard   to   excess   `manufacturing   wastage’   during   the   period <\/p>\n
September,   1963   to   March,   1973,   and   levied   and   demanded   in   all <\/p>\n
`81,94,310\/- as excise duty and an equal amount as additional duty in regard <\/p>\n
to the deficiency in excess of   9% of the total stock of beer (10% prior to  <\/p>\n
19.7.1975). The said orders were challenged by the first respondent by filing <\/p>\n
a revision before the state government. The state government by order dated <\/p>\n
12.4.1978   dismissed   the   revision   petition   and   upheld   the   demands   by   the <\/p>\n
Excise Commissioner.\n<\/p>\n
\n                                               4<\/span><\/p>\n
4.      The   first   respondent   challenged   the   orders   of   the   Excise <\/p>\n
Commissioner   and   the   state   government   in   Civil   Misc.   Writ   Petition <\/p>\n
No.3968 of 1978. A Division Bench of the High Court allowed the said writ <\/p>\n
petition with other connected petitions by a common order dated 15.3.2002. <\/p>\n
It   quashed   the   revision   order   dated   12.4.1978   and   directed   the   state <\/p>\n
government to decide the revision afresh “after calculating the stock of beer <\/p>\n
for the purpose of original Rule 53 of UP Brewery Rules 1961 (Para 912 of <\/p>\n
UP Excise Manual as it then existed) and section 28-A of the UP Excise Act, <\/p>\n
when after filtration the same has assumed the shape as a finished product <\/p>\n
which   is   normally   consumed   by   human   beings   as   beverage   or   drink”.   In <\/p>\n
short   the   High   Court   has   held   that   the   point   at   which   the   liquor <\/p>\n
manufactured by the brewery was exigible to duty was at the stage, when the <\/p>\n
beer is capable of being consumed by human beings as a beverage, comes  <\/p>\n
into   existence   and   the   deficiency   should   be   worked   out   with   reference   to <\/p>\n
measurement  at such  stage. The High Court rejected the contention of the <\/p>\n
appellants that as soon as wort along with yeast is received in the fermenting  <\/p>\n
vessels   and   ferments,   the   process   of   manufacture   is   complete.   Feeling <\/p>\n
aggrieved   by   the   decision   of   the   High   Court,   the   appellant   has   filed   this <\/p>\n
appeal.\n<\/p>\n
\n                                              5<\/span><\/p>\n
Contention of Parties<\/p>\n
5.     The State contends that the liquor becomes exigible to duty when the <\/p>\n
wort   (processed   extract   of   malt)   along   with   yeast   is   received   in   the <\/p>\n
fermenting vessels and ferments. It is contended that as the wort is placed in  <\/p>\n
the   fermentation   tanks   and   the   yeast   is   added   to   it,   fermentation   starts <\/p>\n
immediately with the conversion of sugar into alcohol. After the addition of <\/p>\n
yeast   when   alcohol   is   first   formed,   the   liquid   in   the   fermentation   tank <\/p>\n
becomes   alcoholic   liquor   for   human   consumption.   It   is   pointed   out   that <\/p>\n
Entry 51 of List II of Seventh Schedule uses the words “alcoholic liquor for <\/p>\n
human consumption” and not “alcoholic liquor fit for human consumption” <\/p>\n
and therefore, beer is `manufactured’ when the fermenting agents are added <\/p>\n
to the wort and fermentation process commences. The State contended that <\/p>\n
excise duty is leviable on the manufacture and production of goods; and that <\/p>\n
the stage at which it should be imposed, the manner of collection thereof and <\/p>\n
the rate at which it is to be imposed, are matters within the discretion of the <\/p>\n
State. It is lastly submitted that the power to impose a tax or duty implicitly <\/p>\n
carries with it the power to provide against evasion thereof. It is submitted <\/p>\n
that what is in issue is not levy of excise duty, but the validity of measures <\/p>\n
introduced to identify the unauthorised or illegal diversion of beer resulting <\/p>\n
in evasion of excise duty.\n<\/p>\n
\n                                        6<\/span><\/p>\n
6.    The case of the state government as put forth in the counter affidavit <\/p>\n
to the writ petition is extracted thus: Wort is passed into the fermentation vat <\/p>\n
and fermenting yeast are added to the wort by a simultaneous process. As <\/p>\n
soon as the wort along with yeast is received in the fermenting  vessels or  <\/p>\n
fermenting vat, it ferments and process of manufacture of beer is complete. <\/p>\n
It is gauged to find out its quantity and this quantity is entered in the resister <\/p>\n
in Form B-4. In the said register in Form-B4 the dip and gravity of the wort <\/p>\n
is taken. As fermentation  starts simultaneously  the quantity determined  by <\/p>\n
dip and gravity is taken to be beer produced. On the register in Form B-4 the  <\/p>\n
Brewers put in their initials. It is denied that process of manufacture of beer  <\/p>\n
ends when sullage and yeast calls are removed by filtration. In fact quantity <\/p>\n
of yeast and sullage filtered out may vary from one filtration to another in  <\/p>\n
different process. Even after filter beer contains both some yeast and sullage <\/p>\n
and petitioner cannot say that he is only entitled to pay excise duty on such <\/p>\n
quantity after excluding all such yeast and sullage. The filtration is only a  <\/p>\n
process to make it more marketable  in this competitive business but could <\/p>\n
not be part of manufacture. The event of excisable article going into human  <\/p>\n
consumption has no connection with the taxable event in the case of excise <\/p>\n
duty and excise duty is imposed at the stage of manufacture of goods and not <\/p>\n
at the stage of excisable article going into human consumption. <\/p>\n
                                               7<\/span><\/p>\n
7.      The   Brewery   contended   that   the   stage   for   levy   and   realisation   of <\/p>\n
excise duty on beer was the stage of issue of beer from the brewery\/bottling <\/p>\n
bonded   warehouse   after   complying   with   the   statutory   provisions   and <\/p>\n
regulations prescribed for bottling and issue for sale. It was submitted that <\/p>\n
no   excise   duty   could   be   imposed   prior   to   the   stage   of   occurrence   of   the <\/p>\n
excisable event, namely the issue of beer from the brewery\/bottling bonded <\/p>\n
warehouse for sale and human consumption. Alternatively, it was submitted <\/p>\n
that beer manufactured was exigible to duty at the time or stage when the <\/p>\n
finished   product   (beer)   is   received   in   the   storage\/bottling   tanks,   after <\/p>\n
filtration   and   not   at   any   earlier   stage   of   manufacturing   process.   It   is <\/p>\n
submitted   that   the   system   of   collection   of   excise   duty   on   beer,   does   not <\/p>\n
permit levy or realisation of any amount by way of excise duty or fine on the <\/p>\n
quantity   of   beer   which   is   wasted   in   the   manufacturing   process   before   it <\/p>\n
become   exigible   to   excise   duty.   It   is   contended   that   the   legislative <\/p>\n
competence   to   levy   excise   duty   under   Entry   51(a)   of   List   II   of   Seventh <\/p>\n
Schedule to Constitution of India is with reference to `alcoholic liquors for <\/p>\n
human consumption’. As the wort solution cannot be described as alcoholic <\/p>\n
liquor for human consumption at the stage of fermentation and filtration, the <\/p>\n
state   government   cannot   levy   any   excise   duty   or   additional   duty   equal   to <\/p>\n
excise   duty,   in   regard   to   wastage   which   occurs   with   reference   a   material <\/p>\n
                                               8<\/span><\/p>\n
which is not `alcoholic liquor for human consumption’.  It is contended that <\/p>\n
the levy of excise duty\/additional duty by the Excise Commissioner was on <\/p>\n
the   deficiency,   that   is,   the   difference   between   the   quantities   of   wort   and <\/p>\n
finished product (beer), which comprises of the scum, yeast cells brought on <\/p>\n
top of fermenting wort, carbon-di-oxide evolved, sullage etc., settled at the <\/p>\n
bottom of vats which impurities are to be eliminated  before beer could be <\/p>\n
said   to   be   manufactured   or   could   be   described   as   an   alcoholic   liquor   for <\/p>\n
human   consumption.   It   is   contended   that   the   Excise   authorities   had <\/p>\n
calculated the deficiency in the stock of beer in a wrong manner; and that <\/p>\n
while taking stock of beer in the brewery, for the purpose of calculating the <\/p>\n
allowance the authorities have taken the product at an intermediate stage in <\/p>\n
the process of manufacture instead of taking stock of the finished product. <\/p>\n
8.      The   relevant   contentions   of   the   Brewery   in   the   writ   petition   are <\/p>\n
extracted below :\n<\/p>\n<\/p>\n
(i)     The process of manufacturing  beer ends when  the sullage and  yeast <\/p>\n
cells are removed by filtration and fermentation ceases and the manufactured <\/p>\n
bulk beer is ready to be transferred : (a)   for bottling in bond; and   (b) to <\/p>\n
casks for sale and human consumption as draught beer. [Vide para 8 of the <\/p>\n
WP].\n<\/p>\n
\n                                                9<\/span><\/p>\n
(ii)     The   method   adopted   by   the   Excise   department   in   working   out   the <\/p>\n
deficiency in stock is erroneous. What was required under paragraph 912 of <\/p>\n
Excise Manual was to compare the stock of manufactured beer as mentioned <\/p>\n
in the stock account of beer and the actual stock of beer giving allowance for <\/p>\n
the   quantity   issued.   What   has   been   done   in   the   instant   case   is   to   assume <\/p>\n
certain quantity as part of the stock account of beer which was not beer and <\/p>\n
was undergoing the process of manufacture into beer. Similarly the quantity <\/p>\n
of beer issued from the Brewery has not been taken in its entirety to be the  <\/p>\n
quantity   of   beer   issued.   The   quantity   issued   has   been   equated   with   the <\/p>\n
quantity actually bottled with the result that the quantity of beer which has <\/p>\n
been wasted in the process of bottling has been treated to be part of the stock <\/p>\n
of beer in the beer account. [Vide para 61]<\/p>\n
(iii)    If the quantity of beer which is actually issued for bottling from the <\/p>\n
brewery   is   taken   into   account   in   its   entirety   for   purposes   of   the   stock <\/p>\n
account, the percentage of deficiency between the stock account of beer and <\/p>\n
the actual quantity of beer found on physical verification will be below 10% <\/p>\n
[Vide para 63].\n<\/p>\n<\/p>\n
(iv)     What   is  being  subjected   to  the  levy   of  penalty   or  penal   duty  before <\/p>\n
becoming a manufactured saleable article is the deficiency between the wort <\/p>\n
and the finished beer for sale, comprising of scum and yeast cells brought on <\/p>\n
top   of   fermenting   wort,   carbon   dioxide   evolved,   sullage   etc.   settled   at   the <\/p>\n
bottom of vats which impurities have to be eliminated etc. before beer could  <\/p>\n
become  saleable.   Thus what  has not come  to  exist  as  such  saleable  goods <\/p>\n
cannot be termed as excisable article. [Vide para 93(b)]”<\/p>\n
                                                     10<\/span><\/p>\n
Questions for consideration <\/p>\n
9.      On   the   contentions   urged,   the   following   two   questions   arise   for   our <\/p>\n
consideration:\n<\/p>\n<\/p>\n
(i)     At what stage does the beer manufactured is exigible to duty?<\/p>\n
(ii)    Whether   the   procedure   adopted   by   the   appellants   for   ascertaining <\/p>\n
        excess manufacturing wastage (excess deficiency) is proper?<\/p>\n
To appreciate these issues and find answers to the questions, it is necessary <\/p>\n
to refer to the process of manufacture of beer, the relevant provisions of the  <\/p>\n
UP Excise Act, 1910 (For short `the Act’) and the relevant Brewery Rules. <\/p>\n
Process of manufacture of Beer<\/p>\n
10.     Encyclopaedia   Britannica   (15th  Edition,   Vol.14,   Page   739)   describes <\/p>\n
the stages of brewing process thus :\n<\/p>\n<\/p>\n
        “Beer   production   involves   malting,   milling,   mashing,   extract   separation, <\/p>\n
        hop  addition   and  boiling,   removal   of  hops   and  precipitates,   cooling   and <\/p>\n
        aeration,   fermentation,   separation   of   yeast   from   young   beer,   aging, <\/p>\n
        maturing,   and   packaging.   The   object   of   the   entire   process   is   to   convert <\/p>\n
        grain starches to sugar, extract it with water, and then ferment it with yeast  <\/p>\n
        to produce the alcoholic, lightly carbonated beverage.” <\/p>\n
As the description of the brewing process given in Encyclopaedia Britannica <\/p>\n
is   detailed   and   very   lengthy,   we   have   opted   for   the   following   shorter   and <\/p>\n
simpler   description   of   the   brewing   process   given   in   Wikipedia <\/p>\n
                                                     11<\/span><\/p>\n
(https:\/\/en.wikipedia.   org\/wiki\/Beer)   which   is   in   consonance   with   what   is <\/p>\n
stated in Encyclopaedia Britannica :\n<\/p>\n<\/p>\n
       “The process of making beer is known as brewing. A dedicated building <\/p>\n
       for the making of beer is called a brewery……The purpose of brewing is <\/p>\n
       to convert the starch source into a sugary liquid called wort and to convert  <\/p>\n
       the   wort   into   the   alcoholic   beverage   known   as   beer   in   a   fermentation <\/p>\n
       process effected by yeast.\n<\/p><\/blockquote>\n
\n       The   first   step,   where   the   wort   is   prepared   by   mixing   the   starch   source <\/p>\n
       (normally   malted   barley)   with   hot   water,   is   known   as   “mashing”.   Hot <\/p>\n
       water (known as “liquor” in brewing terms) is mixed with crushed malt or <\/p>\n
       malts (known as “grist”) in a mash tun. The mashing process takes around <\/p>\n
       1 to 2 hours, during which the starches are converted to sugars, and then <\/p>\n
       the sweet wort is drained off the grains. The grains are now washed in a <\/p>\n
       process known as “sparging”. This washing allows the brewer to gather as <\/p>\n
       much of the fermentable liquid from the grains as possible. The process of <\/p>\n
       filtering   the   spent   grain   from   the   wort   and   sparge   water   is   called  wort  <\/p>\n
       separation.   The   traditional   process   for   wort   separation   is   lautering,   in <\/p>\n
       which   the   grain   bed   itself   serves   as   the   filter   medium.   Some   modern <\/p>\n
       breweries prefer the use of filter frames which allow a more finely ground <\/p>\n
       grist.   Most   modern   breweries   use   a   continuous   sparge,   collecting   the <\/p>\n
       original   wort   and   the   sparge   water   together.   However,   it   is   possible   to <\/p>\n
       collect   a   second   or   even   third   wash   with   the   not   quite   spent   grains   as  <\/p>\n
       separate   batches.   Each   run   would   produce   a   weaker   wort   and   thus   a <\/p>\n
       weaker beer. This process is known as second (and third) runnings. <\/p>\n
       The sweet wort collected from sparging is put into a kettle, or “copper”, <\/p>\n
       (so called because these vessels were traditionally made from copper) and <\/p>\n
       boiled,   usually   for   about   one   hour.   During   boiling,   water   in   the   wort <\/p>\n
       evaporates, but the sugars and other components of the wort remain; this <\/p>\n
       allows  more  efficient  use  of the  starch  sources   in  the  beer.  Boiling  also <\/p>\n
       destroys  any remaining enzymes  left over from the mashing stage. Hops <\/p>\n
       are   added   during   boiling   as   a   source   of   bitterness,   flavour   and   aroma. <\/p>\n
       Hops may be added at more than one point during the boil. The longer the <\/p>\n
       hops   are   boiled,   the   more   bitterness   they   contribute,   but   the   less   hop <\/p>\n
       flavour and aroma remains in the beer.\n<\/p><\/blockquote>\n
\n       After boiling, the hopped wort is now cooled, ready for the yeast. In some <\/p>\n
       breweries, the hopped wort may pass through a hopback, which is a small <\/p>\n
       vat filled with hops, to add aromatic hop flavouring and to act as a filter;  <\/p>\n
       but usually the hopped wort is simply cooled for the fermenter, where the  <\/p>\n
       yeast is added. During fermentation, the wort becomes beer in a process <\/p>\n
       which   requires   a   week   to   months   depending   on   the   type   of   yeast   and <\/p>\n
                                                    12<\/span><\/p>\n
       strength   of   the   beer.   In   addition   to   producing   alcohol,   fine   particulate <\/p>\n
       matter   suspended   in   the   wort   settles   during   fermentation.   Once <\/p>\n
       fermentation is complete, the yeast also settles, leaving the beer clear. <\/p>\n
       Fermentation   is   sometimes   carried   out   in   two   stages,   primary   and <\/p>\n
       secondary.   Once   most  of  the   alcohol   has   been  produced   during  primary <\/p>\n
       fermentation, the beer is transferred to a new vessel and allowed a period <\/p>\n
       of secondary fermentation. Secondary fermentation is used when the beer <\/p>\n
       requires long storage before packageing or greater clarity. When the beer <\/p>\n
       has   fermented,   it   is   packaged   either   into   casks   for   cask   ale   or   kegs, <\/p>\n
       aluminium cans, or bottles for other sorts of beer.”<\/p>\n<\/blockquote>\n
11.    We may next extract the definition of beer, stages of manufacture of <\/p>\n
beer, and the fermentation process described in Chapter XI (Brewing) from <\/p>\n
UP Excise Manual (Volume-V) :\n<\/p>\n<\/p>\n
       “Beer defined – The term `beer’ as used in the Indian Excise Law, refers <\/p>\n
       to `fermented, undistilled liquors, of which malt is the primary base, and <\/p>\n
       are   flavoured   with   a   wholesome   bitter   usually   hops’.   Beer   therefore <\/p>\n
       includes   ale,   beer,   black   beer,   porter,   stout,   etc.,   and   the   precise <\/p>\n
       manufacture of these products is termed “brewing”. <\/p>\n
       Lager beers – The beers mentioned above are prepared by what is known <\/p>\n
       as   a   `top   fermentation   process;   the   yeasts   employed   are   designated   `top <\/p>\n
       yeasts   and   the   products   `top   fermentation   beers’.   In   contradistinction   to <\/p>\n
       the above, lager beers are prepared by employing `bottom yeasts’ and the  <\/p>\n
       process is termed `bottom fermentation’.\n<\/p><\/blockquote>\n
\n       Barley  – The  fermenting  raw   material  commonly  used  in production   of <\/p>\n
       beers are (a) Barley, (b) Barley Malt (or Malt), (c) other unmalted cereals <\/p>\n
       such as maize or rice, which are employed as grits, broken rice or flakes <\/p>\n
       and   maize   starch,   (d)   sugars   derived   almost   exclusively   from   sugarcane <\/p>\n
       and maize starch, such as, cane sugar, invert, etc. The latter two viz,. (c) <\/p>\n
       and (d) are known as `malt adjuncts’ as they partially replace the malt. <\/p>\n
       Manufacture   of   beer   may   be   considered   under   the   following   five <\/p>\n
       stages :\n<\/p><\/blockquote>\n
<\/blockquote>\n
           (a) Preparation of the malt from Barley.\n<\/p><\/blockquote>\n
           (b) Infusion   of   the   ground   malt   or   `grist’   and   straining   the   resultant  <\/p>\n
                extract or wort.\n<\/p><\/blockquote>\n
\n                                             13<\/span><\/p>\n<\/blockquote>\n
    (c) Boiling  the wort with hops or other bitters, straining  of the hops <\/p>\n
         and cooling.\n<\/p><\/blockquote>\n
    (d) Fermenting the wort.\n<\/p><\/blockquote>\n
    (e) Settling, Racking, cellar treatment and bottling. <\/p>\n<\/blockquote>\n
Fermentation<\/p>\n
Unlike Whisky fermentation, fermentation of beer is conducted in England <\/p>\n
by employing top fermentation yeast and the different systems only differ <\/p>\n
in the flocculation and attenuating power of the yeast employed, while in <\/p>\n
bottom   fermentation   breweries   producing   larger   beers.   The   yeast   is <\/p>\n
generally mixed with a small quantity of wort at 65 F and poured into the <\/p>\n
incoming wort, or if the yeast required in vogorating, it is allowed to come  <\/p>\n
into   active   fermentation   before   addition   to   the   fermenting   vessel.   Yeast <\/p>\n
food, if any is needed is in a few hours is at its height as can be seen by the <\/p>\n
maximum temperature reached and is allowed to continue for 5 to 8 days.<\/p>\n
The following description of the practice in India is of interest: <\/p>\n
Pitching of the wort  –  The fermentation vats usually have a capacity of <\/p>\n
3,000 gallons, which is equivalent to 140 bushels of malt (having a sugar  <\/p>\n
content of 40 per cent). The cooled hopped wort from the malt is mixed at <\/p>\n
this stage with 300 lb. of sugar and = lb. of ammonium sulphate followed <\/p>\n
by   60   lb.   of   yeast   in   suspension   (containing   85   per   cent   moisture)   and <\/p>\n
allowed to ferment for 5-6 days. The peak of the fermentation is reached  <\/p>\n
in 36 hours. At the end of the fermentation, the vats are slowly aerated by <\/p>\n
`Sterilized   air’.   Fermentation   of   beer   is   conducted   by   employing   top <\/p>\n
fermentation yeast. This and the atmosphere of CO on the top of the vat  <\/p>\n
prevent any bacteria gaining access to the beer. The fermentation is carried <\/p>\n
on until the gravity of the wort falls down to 1.042, when the wort is run  <\/p>\n
off   into   fining   vessels   so   as   to   settle   and   clarify.   Throughout   the <\/p>\n
fermenting stage the temperature of the wort is regulated by coils of piping <\/p>\n
called at temperature through which cold water is passed.<\/p>\n
Fermentation of lager beers.  – Bottom fermentation processes used for <\/p>\n
lager   beer   differ   from   top   fermentation   adopted   for   ales   in   that   the <\/p>\n
temperature   ranges   between   41   degree   Fahrenheit   and   56   degree <\/p>\n
Fahrenheit, while the yeast settles as a firm black cover at the bottom of  <\/p>\n
the fermenting vessel. The primary fermentation also lasts for 7 to days at <\/p>\n
the higher temperature or 12 to 14 days at lower temperatures as the rate <\/p>\n
of fermentation is considerably slower than in top fermentation  systems. <\/p>\n
Bottom fermentation beer is usually lagered or stored for periods varying <\/p>\n
from   1   to   9   months   (generally   6   to   8   weeks)   after   this   primary <\/p>\n
fermentation   during   which   slow   changes   called   `maturation’   occur   and <\/p>\n
this gives the name to the beer. Fermentation in the storage stage is due to <\/p>\n
primary yeasts carried down with the beer from the fermenting vessel.<\/p>\n
                                                    14<\/span><\/p>\n
       Gasing, Racking and Bottling – Although lager beer is ultimately filtered <\/p>\n
       before   racking   into   casks,   clarification   is   an   essential   function   of   the <\/p>\n
       storage.\n<\/p>\n
\n       Uncarbonated   top   fermentation   beers,   which   include   the   bulk   of   British <\/p>\n
       draught   ales   are   either   racked   directly   from   the   fermenting   vessel   or <\/p>\n
       settling  back  to  which  they  are  run down from  Fermenting   vessels. The <\/p>\n
       settling   back   provides   a   means   of   further   clarification   by   sedimentation <\/p>\n
       during 2 to 12 hours. This is also used for addition of primings, colourings  <\/p>\n
       and   sometimes   finings   though   these   are   sometimes   added   to   individual <\/p>\n
       casks. The beer loses carbon dioxide and gets aerated. Dry hops are also <\/p>\n
       sometime   added   to   the   settling   backs.   Racking   in   cylinders   and   counter <\/p>\n
       pressure racking is also followed.”\n<\/p>\n<\/p>\n
12.    The first respondent describes (in Annexure-I to the writ petition) the <\/p>\n
process of manufacturing beer in its brewery thus:\n<\/p>\n<\/p>\n
       “The Process of Manufacturing of Beer – Coarsely crushed barley malt <\/p>\n
       termed   “grist”   added   with   cooked   maize   and   rice   clakes   is   boiled   at   a <\/p>\n
       specific   temperature   in   treated   water   in   the   vessel   called   mashtun   by <\/p>\n
       which   the   starches   present   in   the   grain   are   converted   into   sugars.   The <\/p>\n
       extract   from   the   grain   called   wort   is   drawn   into   another   vessel   called <\/p>\n
       `copper’   to   which   hops   flowers   and   sugar   is   added   and   boiled   with   the <\/p>\n
       purpose of sterilizing the wort, separating wastable proteins in the form of <\/p>\n
       precipitate,   dissolving   bittering   constitutents   of   hops   and   imparting <\/p>\n
       aromatic flavour of hops flowers. The spent hops are separated from the <\/p>\n
       boiled wort which is cooled and passed into fermentation vats. <\/p>\n
       Brewers   yeast   is   “pitched”   to   initiate   fermentation.   The   fermentation   is <\/p>\n
       carried on at low temperature. Lot of frothing takes place, the yeast cells <\/p>\n
       multiply and bring up dirty heads with resins of hops etc., at the top which <\/p>\n
       are   cleared  out,  the  convertible   sugars  are   decomposed   into  alcohol  and <\/p>\n
       carbon   dioxide   gas;   the   hanging   particles   in   the   wort   settled   down   with <\/p>\n
       coagulated   albuminous   substances   and   yeast   cells   during   the   process   of <\/p>\n
       fermentation which is carried on for 8 to 10 days.\n<\/p><\/blockquote>\n
\n       The fermented wort is racked into settling tanks or storage tanks leaving  <\/p>\n
       the sullage or sludge at the bottom of fermentation vats. At this stage also <\/p>\n
       (i.e. in storage vats) some yeast cells are present in the fermented wort and  <\/p>\n
       secondary fermentation takes place besides some residuary particles in the <\/p>\n
       bulk of fermented wort settling at the bottom of the storage vats. <\/p>\n
                                                      15<\/span><\/p>\n
        To   eliminate   secondary   fermentation   and   haze   from   this,   it   is   passed <\/p>\n
        through   filter   machines   in  which   100  to  150  filter  sheets  are   fixed.  The <\/p>\n
        filterate   is   transferred   to   bottling   tanks   for   bottling   beer   in   a   separate <\/p>\n
        bonded   warehouse,   which   is   carried   on   under   the   supervision   of   the <\/p>\n
        officer-in-charge of the warehouse.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
13.     It is thus evident that the process of brewing beer involves malting, <\/p>\n
mashing, boiling, fermentation, separation of yeast from the beer, ageing and <\/p>\n
finishing.   The   fermented   alcoholic   liquor   that   can   be   identified   as   `beer’ <\/p>\n
comes into existence on completion of the process of fermentation. Ageing <\/p>\n
is   carried   out   only   in   the   manufacture   of  certain   types   of  beer,   by   storing <\/p>\n
beer   in   storage   tanks   for   certain   period.   Filtration   removes   the   remaining  <\/p>\n
yeast (the major portion settles as sediment in the fermentation vats and is <\/p>\n
removed   as   sullage)   and   then   packed   into   barrels,   bottles   or   cans.   The <\/p>\n
filtration, ageing and finishing are processes to remove impurities, improve <\/p>\n
the clarity, taste and increase shelf life.\n<\/p>\n
Relevant provisions of the Act and the Rules<\/p>\n
14.     The   relevant   provisions   of   the   UP   Excise   Act,   1910   are   extracted <\/p>\n
below :\n<\/p>\n<\/p>\n
        “Section 3 (3a). “Excise duty” and “countervailing duty” means any such <\/p>\n
        excise   duty or  countervailing  duty,  as   the  case  may  be,  as   is  mentioned <\/p>\n
        Entry 51 of List II in the Seventh Schedule to the Constitution;<\/p>\n
        Section 3 (10).  “Beer” includes ale, stout, porter and all other fermented <\/p>\n
        liquor made from malt;\n<\/p><\/blockquote>\n
\n                                            16<\/span><\/p>\n<\/blockquote>\n
Section  3 (22a). “Excisable article” means  – (a) any alcoholic  liquor for <\/p>\n
human consumption; or  (b). any intoxicating drug;\n<\/p>\n
\nSection   28   Duty   on   excisable   articles-(1)  An   excise   duty   or   a <\/p>\n
countervailing duty, as the case may be, at such rate or rates as the State <\/p>\n
Government   shall   direct,   may   be   imposed,   either   generally   or   for   any <\/p>\n
specified local area, on any excisable article-\n<\/p>\n<\/p>\n
    (a)  imported in accordance with the provisions of Section 12 (1); or<\/p>\n<\/blockquote>\n
    (b)  exported in accordance with the provisions of Section 13; or<\/p>\n<\/blockquote>\n
    (c)  transported; or<\/p>\n<\/blockquote>\n
    (d)  manufactured,   cultivated   or   collected   under   any   licence   granted <\/p>\n
          under Section 17; or<\/p>\n<\/blockquote>\n
    (e)  manufactured   in   any   distillery   established   or   any   distillery   or <\/p>\n
          brewery licensed, under Section 18:\n<\/p><\/blockquote>\n
<\/blockquote>\n
x  x x x x x <\/p>\n
Section   28A   –   Imposition   of   additional   duty   in   certain   cases  –   (1) <\/p>\n
Where the quantity of spirit or beer in a brewery is found, on examination <\/p>\n
by   such   officer   of   the   Excise   Department   as   may   be   authorised   by   the <\/p>\n
Excise   Commissioner   in   this   behalf   to   exceed   the   quantity   in   hand   as <\/p>\n
shown in the stock account, the brewery shall be liable to pay duty on such <\/p>\n
excess at the ordinary rates fixed under Section 28.\n<\/p>\n
\n(2) Where the quantity of spirit or beer is less than that shown in the stock <\/p>\n
account   on   such   examination   and   deficiency   exceeds   ten   per   cent; <\/p>\n
(allowance to that extent being made to cover losses due to evaporation, <\/p>\n
sullage and other contingencies within the brewery, and also to cover loss <\/p>\n
in bottling and storage) the Excise Commissioner shall levy an additional <\/p>\n
duty at the rate of one hundred per cent of ordinary rates of duty in respect <\/p>\n
of such deficit as exceeds ten per cent over and above the ordinary rates of <\/p>\n
duty.”\n<\/p>\n
\nSection   29.     Manner   in   which   duty   may   be   levied  –   Subject   to   Such <\/p>\n
rules, as the Excise Commissioner may prescribe to regulate to the time,  <\/p>\n
place and manner of payment, such duty may be levied in one or more of <\/p>\n
the following ways as the State Government may by notification direct:<\/p>\n
(a) to (d) …(omitted as not relevant)<\/p>\n
(e) in the case of spirit or beer manufactured in any distillery established <\/p>\n
or any distillery or brewery licensed under Section 18 –<\/p>\n
                                                     17<\/span><\/p>\n
           (i)  by a rate charged upon the quantity produced or issued from the <\/p>\n
                distillery   or   brewery,   as   the   case   may   be,   or   issued   from   a <\/p>\n
                warehouse established or licensed , under Section 18 (d);<\/p>\n<\/blockquote>\n
           (ii) by   a   rate   charged   in   accordance   with   such   scale   of   equivalents, <\/p>\n
                calculated   on   the   quantity   of   materials   used   or   by   the   degree   of <\/p>\n
                attenuation of the wash or wort, as the case may be, as the State <\/p>\n
                Government may prescribe :\n<\/p><\/blockquote>\n
\n       Provided that, where payment is made upon issued of an excisable article  <\/p>\n
       for sale from a warehouse established or licensed under Section 18(d), it <\/p>\n
       shall   be  at   the  rate  of  duty which   is   in  force   on  that  article  on  the   date <\/p>\n
       when it is issued from the warehouse.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
15.    Rule 53 of the UP Brewery Rules, 1961 (Paragraph 912 of the Excise <\/p>\n
Manual) as it stood prior to substitution of the rule on 19.7.1975 provided  <\/p>\n
for quarterly examination of stock and read as follows: <\/p>\n
       “912. Quarterly Examination of Stock. – The accounts of a brewery and <\/p>\n
       the stock of beer in hand in the brewery shall be examined by the Assistant <\/p>\n
       Excise commissioner once a quarter. If the quantity of the beer in stock in <\/p>\n
       the brewery on such examination be found to exceed the quantity shown <\/p>\n
       as in hand in the stock account, the brewer shall be liable to pay duty on  <\/p>\n
       such excess at double the rate prescribed for ordinary issue. If the quantity <\/p>\n
       be   found   less   than   that   shown   in   the   stock   account,   the   cause   of   the <\/p>\n
       deficiency   shall   be   inquired   into   and   the   result   reported   to   the   Excise <\/p>\n
       Commissioner, who may direct the levy of a fee not exceeding double the <\/p>\n
       amount   represented   by   the   duty   on   such   deficiency.   Provided   that   any <\/p>\n
       deficiency not exceeding 10. per cent, shall be disregarded, allowance to <\/p>\n
       the extent being made to cover loss in bulk due to evaporation, sullage and <\/p>\n
       other contingencies within the brewery. This allowance Shall be calculated <\/p>\n
       upon the amount represented by the actual ascertained balance in hand at <\/p>\n
       the   date   of   the   last   stock   taking,   together   with   the   total   quantity   since <\/p>\n
       manufactured or received, as shown in column 2 and 3 of the register of <\/p>\n
       manufacture and issue (form B-16).\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
Rule 53 of the Brewery Rules (para 912 of the Excise Manual) as substituted <\/p>\n
on 19.7.1975 reads as under:\n<\/p>\n
\n                                                     18<\/span><\/p>\n
      “912. On the last working day of every calendar month after all the issues <\/p>\n
      for that day are made, the Officer-in-charge shall examine the accounts of <\/p>\n
      brewery and take the stock of beer in hand in the brewery. if the quantity <\/p>\n
      of   the   beer   in   stock   in   the   brewery   on   such   examination   be   found   to <\/p>\n
      exceed the quantity shown as in hand in the stock account the brewer shall  <\/p>\n
      be   liable   to   pay   duty   on   such   excess   at   the   rate   prescribed   for   ordinary <\/p>\n
      issue if the quantity be found less than that shown in the stock account and <\/p>\n
      such deficiency does not exceed nine per cent of the total stock of beer in  <\/p>\n
      the  month  the same  may be disregarded  allowances  to  that extent  being <\/p>\n
      made to cover losses due to evaporation, sullage and other contingencies <\/p>\n
      within the brewery. But if the deficiency in stock be found to exceed nine <\/p>\n
      per   cent   the   cause   shall   be   enquired   into   and   the   result   reported   to   the  <\/p>\n
      Excise Commissioner who may direct the levy of duty on such deficiency <\/p>\n
      as   may   be   found   in   excess   of   nine   percent   at   the   rate   prescribed   for <\/p>\n
      ordinary issue. This nine per cent free allowance shall be calculated up on <\/p>\n
      the quantity represented by the actual ascertained balances in hand at the <\/p>\n
      close   of   the   last   stock   taking   together   with   the   total   quantity   since <\/p>\n
      manufactured or received, as shown in columns 2 and 3 of the register of <\/p>\n
      manufacture and issue (Form B-1).\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
Rule 37 of the Brewery Rules (para 896 of the Excise Manual) reads thus: <\/p>\n
      “896. Worts  to be drawn off in the order of production: All worts shall <\/p>\n
      be   removed   successively,   and   in   the   customary   order   of   brewing   to   the <\/p>\n
      under   back,   coppers,   coolers   and   fermenting   vessels,   and   shall   not   be <\/p>\n
      removed from the last named vessel until an account has been taken by the <\/p>\n
      officer   incharge   or   until   after   the   expiry   of   twenty   four   hours   from   the <\/p>\n
      time at which the worts are collected in these vessels.”<\/p>\n<\/blockquote>\n
Rule 41 of the Brewery Rules (para 900 of Excise Manual) deals with issue <\/p>\n
of beer and is extracted below:\n<\/p>\n<\/p>\n
      “900.  Beer   not   to   be   issued   until   duty   paid   or   bond   executed  – <\/p>\n
      [Rule   41].   No   beer   shall   be   removed   from   a   brewery   until   the   duty <\/p>\n
      imposed under section 28 of the UP Excise Act, 1910 (Act No.IV of 1910) <\/p>\n
      has been paid or until a bond under section 19 of the Act in Form B-7 or <\/p>\n
      B-8 has been executed by the brewer for export of beer outside the State, <\/p>\n
      direct from the brewery.\n<\/p><\/blockquote>\n
\n                                                     19<\/span><\/p>\n<\/blockquote>\n
Legal position enunciated by this Court<\/p>\n
16.    We may next refer to the decisions of this Court bearing on the issue <\/p>\n
in R.C. Jall Parsi  vs. Union of India<\/a> [AIR 1962 SC 1281], this court held :<\/p>\n
       “Excise   duty   is   primarily   a   duty   on   the   production   or   manufacture   of <\/p>\n
       goods produced or manufactured within the country. It is an indirect duty <\/p>\n
       which the manufacturer or producer passes on to the ultimate consumer,  <\/p>\n
       that is, its ultimate incidence will always be on the consumer. Therefore, <\/p>\n
       subject  always  to the legislative  competence  of the taxing authority,  the  <\/p>\n
       said tax can be levied at a convenient stage so long as the character of the  <\/p>\n
       impost, that is, it is a duty on the manufacture or production, is not lost.  <\/p>\n
       The method of collection does not affect the essence of the duty, but only  <\/p>\n
       relates   to   the   machinery   of   collection   for   administrative   convenience. <\/p>\n
       Whether in a particular case the tax ceases to be in essence an excise duty,  <\/p>\n
       and the rational connection between the duty and the person on whom it is  <\/p>\n
       imposed   ceased   to   exist,   is   to   be   decided   on   a   fair   construction   of   the <\/p>\n
       provisions of a particular Act.”\n<\/p><\/blockquote>\n
                                                                          (emphasis supplied)    <\/p>\n<\/blockquote>\n
17.    In  Synthetics   and   Chemicals   Ltd.   vs.   State   of   U.P.<\/a>   [1990   (1)   SCC <\/p>\n
109],   this   Court   held   that   the   expression   “alcoholic   liquor   for   human <\/p>\n
consumption”   must   be   understood   in   its   common   and   normal   sense.   The <\/p>\n
expression   “consumption”   must   also   be   understood   in   the   sense   of   direct <\/p>\n
physical intake by human beings and not utilisation in some other forms for <\/p>\n
the ultimate benefit of human consumption and the expression is intended to <\/p>\n
mean “liquor which as it is, could be consumed, in the sense of capable of <\/p>\n
being taken by the human beings as such as a beverage or drink”.<\/p>\n
                                                      20<\/span><\/p>\n<\/blockquote>\n
18.     In State of U.P. vs. Delhi Cloth Mills<\/a> [1991 (1) SCC 454], this Court <\/p>\n
dealing   with   section   28   of   UP   Excise   Act,   1910   considered   the   question <\/p>\n
whether   the   excise   authorities   were   entitled   to   levy   excise   duty   on   the <\/p>\n
wastage   of   liquor   (military   rum)   in   transit   and   held   that   the   levy   of <\/p>\n
differential   duty   (that   is   charging   up   the   duty   on   the   report   of   excess  <\/p>\n
wastage)   did   not   cease   to   be   an   excise   duty   even   if   it   was   levied   on <\/p>\n
declaration of excess wastage. The taxable event was still the production or <\/p>\n
manufacture. This Court observed:\n<\/p>\n<\/p>\n
        “A   duty   of   excise   under   Section   28   is   primarily   levied   upon   a <\/p>\n
        manufacturer   or   producer   in   respect   of   the   excisable   commodity <\/p>\n
        manufactured or produced irrespective of its sale. Firstly, it is a duty upon <\/p>\n
        excisable   goods,   not   upon   sale   or   proceeds   of   sale   of   the   goods.   It   is <\/p>\n
        related to production or manufacture of excisable goods. The taxable event <\/p>\n
        is the production or manufacture of the liquor. Secondly, as was held in A.  <\/p>\n
        B.   Abdulkadir   v.   The   State   of  Kerala<\/a>   –   AIR1962SC922,   an   excise   duty <\/p>\n
        imposed on the manufacture and production of excisable goods docs not <\/p>\n
        cease to be so merely because the duly is levied at a stage subsequent to <\/p>\n
        manufacture   or   production.   That   was   a   case   on   Central   Excise,   but   the <\/p>\n
        principle   is   equally   applicable   here.   It   does   not   cease   to   be   excise   duty <\/p>\n
        because it is collected at the stage of issue of the liquor out of the distillery <\/p>\n
        or   at   the   subsequent   stage   of   declaration   of   excess   wastage.   Legislative <\/p>\n
        competence under entry 51 of List II on levy of excise duty relates only to  <\/p>\n
        goods   manufactured   or   produced   in   the   State   as   was   held   in  Bimal  <\/p>\n
        Chandra Banerjee v. State of Madhya Pradesh  – 1970 (2) SCC 467. In the <\/p>\n
        instant   case   there   is   no   dispute   that   the   military   rum   exported   was <\/p>\n
        produced   in   the   State   of   U.P.   In   State   of   Mysore   and   Ors.   v.   M\/s   D.  <\/p>\n
        Cawasji & Co.<\/a> – 1970 (3)  SCC 710, which was on Mysore Excise Act, it  <\/p>\n
        was   held   that   the   excise   duty   must   be   closely   related   to   production   or <\/p>\n
        manufacture of excisable goods and it did not matter if the levy was made <\/p>\n
        not at the moment of production or manufacture  but at a later stage and <\/p>\n
        even if it was collected from retailer. The differential duty in the instant <\/p>\n
        case, therefore, did not cease to be an excise duty even it was levied on the <\/p>\n
        exporter after declaration of excess wastage. The taxable event is still the <\/p>\n
        production or manufacture…………\n<\/p><\/blockquote>\n
\n                                                       21<\/span><\/p>\n
        ……Rules   636   and   814   are   also   of   regulatory   character   and   they   are <\/p>\n
        precautionary   against   perpetration   of   fraud  on   the   excise   revenue   of   the <\/p>\n
        exporting state. If out of the quantity of military rum in a consignment, a <\/p>\n
        part of portion is claimed to have been wastage in transit and to that extent <\/p>\n
        did   not   result   in   export,   the   State   would,   in   the   absence   of   reasonable <\/p>\n
        explanation, have reason to presume that the same have been disposed of <\/p>\n
        otherwise than by export and impose on it the differential excise duty. A <\/p>\n
        statute   has   to   be   construed   in   light   of   the   mischief   it   was   designed   to  <\/p>\n
        remedy. There is no dispute that excise duty is a single point duty and may <\/p>\n
        be levied at one of the points mentioned in Section 28.”<\/p>\n<\/blockquote>\n
19.     In  Mohan   Meakin   Ltd.   vs.   Excise   &   Taxation   Commissioner,   H.P.<\/a> <\/p>\n
[1997 (2) SCC  193],  this Court  examined  the  question  as to  when beer  is <\/p>\n
exigible   to   excise   duty   under   the   Punjab   Excise   Act,   1914   and   Punjab <\/p>\n
Breweries   Rules   1932.   This   Court   held   that   Beer   would   mean   fermented <\/p>\n
liquor from malt, when it is potable or in consumable condition as beverage. <\/p>\n
The state of levying excise duty upon alcoholic liquor arises when excisable <\/p>\n
article   is   brought   to   the   stage   of   human   consumption   with   the   requisite <\/p>\n
alcoholic strength thereof and it is only the final product which is relevant. <\/p>\n
In that case, the levy of excise duty at the stage when the manufacturing of <\/p>\n
the beer was at wort stage was challenged. This Court posed the question: <\/p>\n
Whether   the   levy   of   excise   duty,   on   beer   when   it   was   in   the   process   of <\/p>\n
manufacture is correct? This Court answered the question thus : <\/p>\n
        “The levy of excise duty is on alcoholic  liquor for human  consumption, <\/p>\n
        manufacture  or production. At what stage beer is  exigible  to duty is  the <\/p>\n
        question. The process of manufacture of beer is described as under:<\/p>\n
                                                22<\/span><\/p>\n
       The   first   stage   brewing   process   is   the   feeding   of   Malt   and  <\/p>\n
       adjuncts into a vessel known as Mash Tun. There it is mixed with <\/p>\n
       hot water and maintained at certain temperature. The objective of <\/p>\n
       this process is to convert the starches of the malt into fermentable <\/p>\n
       sugar.\n<\/p><\/blockquote>\n
\n       The   extract   is   drawn   from   the   Mash   Tun   and   boiled   with   the <\/p>\n
       addition   of   hops   for   one   to   two   hours   after   which   it   is <\/p>\n
       contrifuged,   cooled   and   received   in   the   receiving   wats.   At   this <\/p>\n
       stage,   it   is   called   “Wort”   and   contains   only  fermentable   sugars <\/p>\n
       and   no   alcohol.   After   this   it   is   transferred   to   the   fermentation <\/p>\n
       tanks where Yeast is added and primary fermentation is carried <\/p>\n
       out   at   controlled   temperature.   After   attenuation   (Diminution   of <\/p>\n
       density of “Wort” resulting from its fermentation) is reached for <\/p>\n
       fermented wort is centrifuged and transferred to the storage vats <\/p>\n
       for secondary fermentation. After secondary fermentation is over <\/p>\n
       in   the   storage   vats,   it   is   filtered   twice-first   through   the   rough  <\/p>\n
       filter press and then through the fine filter press and received in <\/p>\n
       the   bottling   tanks.   It   is   in   bottling   tanks   that   the   loss   of   the <\/p>\n
       Carbon   Dioxide   Gas   is   made   up   and   bulk   beer   is   drawn   for <\/p>\n
       bottling.   It   is   filed   into   the   bottles   and   then   last   process   of <\/p>\n
       pasteurisation   is   carried   out   to   make   it   ready   for   packing   and <\/p>\n
       marketing.  Till   the   liquor   is   removed   from   the   vats   and  <\/p>\n
       undergoes   the   fermentation   process   as   mentioned   above   the  <\/p>\n
       presence of alcohol is nil.\n<\/p><\/blockquote>\n
<\/blockquote>\n
Excisable article would mean any alcoholic liquor for human consumption <\/p>\n
or any intoxicating drug. The levy or impost of excise duty would be only <\/p>\n
on alcoholic liquor for human consumption or for being produced in the <\/p>\n
brewery. Beer would mean fermented liquor from malt, when it is potable <\/p>\n
or in consumable condition as beverage. It is seen that the levy is in terms <\/p>\n
of entry 51 of List II of the Seventh Schedule which envisages that duties <\/p>\n
of   excise   on   the   goods   manufactured   or   produced   in   the   State   and <\/p>\n
countervailing   duties   at   the   same   or   lower   rates   on   similar   goods <\/p>\n
manufactured or produced elsewhere in India.\n<\/p>\n
\nThus, the final product of the beer is relevant excisable article exigible to <\/p>\n
duty under Section 31 of the Act  when it passes through fine filter press <\/p>\n
and received in the bottling tank. The question is : at what stage the duty is <\/p>\n
liable to be paid? Section 23 specifically envisages that until the payment <\/p>\n
of duty is made or bond is executed in that behalf as per the procedure and <\/p>\n
acceptance by the Financial Commissioner, the finished product, namely, <\/p>\n
the beer in this case, shall not be removed from the place at which finished <\/p>\n
product   was   stored   either   in   a   warehouse   within   factory   premises   or <\/p>\n
precinct or permitted place of usage. Under these circumstances, the point <\/p>\n
at   which   excise   duty   is   exigible   to   duty   is   the   time   when   the   finished  <\/p>\n
                                                         23<\/span><\/p>\n
        product, i.e., bear was received in bottling tank or the finished product is <\/p>\n
        removed from the place of storage or warehouse etc.”\n<\/p>\n
                                                                                   (emphasis supplied)<\/p>\n
20.     In  Government   of   Haryana   vs.   Haryana   Brewery   Ltd.<\/a>   [2002   (4) <\/p>\n
SCC 547], this Court held :\n<\/p>\n<\/p>\n
        “We agree with the contention of Mr. Divan, and this is also not disputed <\/p>\n
        by Mr. Anand, that the State  has jurisdiction to levy excise duty only on  <\/p>\n
        beer after it has been brewed and has become fit for human consumption.  <\/p>\n
        This is the settled position as laid down by this Court in  Mohan Meakin  <\/p>\n
        and Modi Distillery  cases. The only question which, to our mind,  really <\/p>\n
        arises for consideration is how to determine the quantity of beer which is  <\/p>\n
        manufactured on which the excise duty is to be levied. Section 32 gives an <\/p>\n
        answer to this question. The first part of the Section states that subject to <\/p>\n
        the rules which may be made by the Financial Commissioner, Excise Duty <\/p>\n
        is   to   be   levied,  inter   alia,  on   the   excisable   article   manufactured   in   or <\/p>\n
        issued from a distillery, brewery or warehouse.  A reading of this Section  <\/p>\n
        leaves   no   manner   of   doubt   that   the   stage   at   which   excise   duty   can   be  <\/p>\n
        levied is only after the process of manufacture has been completed and in  <\/p>\n
        fact,   it   is   to   be   levied   when   it   is   issued   from   the   distillery,   brewery   or  <\/p>\n
        warehouse.”\n<\/p><\/blockquote>\n
                                                                                  (emphasis supplied) <\/p>\n
Re: Question No. (i)<\/p>\n<\/blockquote>\n
21.     The   High   Court   has   held   that   the   point   at   which   the   liquor <\/p>\n
manufactured by the brewery is exigible to excise duty is the stage when the <\/p>\n
finished   product   (beer)   capable   of   being   consumed   by   human   beings   as   a <\/p>\n
beverage   or   drink,   comes   into   existence   that   is,   after   the   process   of <\/p>\n
fermentation   and   filtration.     In  Synthetics   and   Chemicals   Ltd   &   Ors.   vs.  <\/p>\n
State   of   U.P.   &   Ors.<\/a>    –   1990   (1)   SCC   109   and  State   of   U.P.   vs.   Modi  <\/p>\n
Distillery & Ors.<\/a> – 1995 (5) SCC 753, this Court held that having regard to <\/p>\n
                                               24<\/span><\/p>\n
Entry 51 of List II of Seventh Schedule to the Constitution, the State would <\/p>\n
be   authorized   to   impose   excise   duty   on   alcoholic   liquor   for   human <\/p>\n
consumption  which meant that the liquor, as itself, was consumable  in the <\/p>\n
sense   that   it   was   capable   of   being   taken   by   human   beings   as   such   as   a <\/p>\n
beverage   or   drink.   This   Court   in  Government   of   Haryana   vs.   Haryana  <\/p>\n
Breweries Ltd. & Anr..<\/a> – 2002 (4) SCC 547, held that State has jurisdiction <\/p>\n
to levy excise duty on beer only after it has been brewed and has become fit <\/p>\n
for   human   consumption;   and   having   regard   to   section   32   of   the   Punjab <\/p>\n
Excise Act, 1914, the stage at which excise duty could be levied on beer was <\/p>\n
after the process of manufacture was complete and when it is issued from the <\/p>\n
brewery or warehouse.\n<\/p>\n<\/p>\n
22.     This Court also reiterated the said position in Mohan Meakin Ltd. vs.  <\/p>\n
Excise   &   Taxation   Commissioner,   H.P.<\/a>  –   1997   (2)   SCC   193   but   further <\/p>\n
observed that beer would be exigible to duty when it passes through the fine <\/p>\n
filter   press   (after   fermentation)   and   is   received   in   the   bottling   tank.   The <\/p>\n
words   `received   in   the   bottling   tank’   obviously   referred   to   beer   being <\/p>\n
received   in   any   container   or   vessel   for   storage,   after   fermentation   and <\/p>\n
filtration.   It   may   however   be   noted   that   the   said   observation   that   beer   is <\/p>\n
exigible   to   excise   duty   only   when   it   passes   through   the   fine   filter   press <\/p>\n
                                                  25<\/span><\/p>\n
would apply only to the standard types of beer which is sold in bottles and <\/p>\n
cans.   Beer   is   also   supplied   in   casks   and   barrels,   taken   directly   from <\/p>\n
fermentation vessels without undergoing any filtration or further processing, <\/p>\n
known as Draught (or Draft) beer. Such beer is unpasteurized and unfiltered <\/p>\n
(or even if filtered, only in a limited manner and not fine filtered like beer  <\/p>\n
intended   to   be   sold   in   bottles   or   cans).   Para   29   of   Excise   Manual   (Vol.V <\/p>\n
Chapter   XI)   notes  that   uncarbonated   top   fermentation   beer,   which   include <\/p>\n
draught beer are racked directly from the fermenting vessel. Thus when the <\/p>\n
fermentation process of wort is completed, it becomes an alcoholic liquor for <\/p>\n
human consumption and there is no legal impediment for subjecting beer to <\/p>\n
excise duty at that stage. Therefore, the State has legislative competence to <\/p>\n
levy   excise   duty   on   beer   either   after   the   completion   of   the   process   of <\/p>\n
fermentation and filtration, or after fermentation.<\/p>\n
23.     Section   29   (e)(i)   of   the   Act   makes   it   clear   that   in   the   case   of   beer <\/p>\n
manufactured   in   a   brewery,   excise   duty   may   be   levied,   by   a   rate   charged <\/p>\n
upon   the   quantity   produced   or   issued   from   the   brewery   or   issued   from   a <\/p>\n
warehouse. This means that in respect of beer that undergoes the process of <\/p>\n
filtration,   the   exigibility   to   excise   duty   will   occur   either   at   the   end   of <\/p>\n
filtration process when it is received in storage\/bottling tanks or when it is <\/p>\n
                                                 26<\/span><\/p>\n
issued   from   the   brewery.   In   regard   to   draught   beer   drawn   directly   from <\/p>\n
fermentation vessels, without further processing or filtration, the exigibility <\/p>\n
to excise duty will occur either at the end of fermentation process or when it <\/p>\n
is issued from the brewery.\n<\/p>\n
Re: Question No.(ii)<\/p>\n
24.     The High Court rejected the Brewery’s contention that only such beer <\/p>\n
which   comes   to   the   `bottling   tank’   after   filtration,   can   be   treated   as <\/p>\n
`manufactured   beer’   and   exigible   to   excise   duty   and   wastage   allowance <\/p>\n
could be given only with reference to such beer which has become a finished <\/p>\n
product. But  the  High Court  allowed  the  writ petition of  the  Brewery  and <\/p>\n
directed   that   validity   of   the   demand   should   be   decided   afresh,   “after  <\/p>\n
calculating   the   stock   of   beer  for   the   purpose   of   original   Rule   53   of   UP  <\/p>\n
Brewery Rules, 1961 (Para 912 of UP Excise Manual as it then existed) and  <\/p>\n
section   28A  of  UP   Excise  Act,  when   after  filtration  the  same   assumes   the  <\/p>\n
shape as a finished product which is normally consumed by human beings  <\/p>\n
as  a  beverage  or drink”. The real question arising for consideration in this <\/p>\n
case   is   not   about   the   stage   at   which   beer   is   exigible   to   excise   duty,   but <\/p>\n
whether the procedure adopted by the appellant for ascertaining the excess <\/p>\n
                                            27<\/span><\/p>\n
wastage   (or   shortage   in   quantity)   and   levying   duty   and   additional   duty <\/p>\n
thereon, is legal and valid.\n<\/p>\n<\/p>\n
25.    The   contention   which   ultimately   found   favour   with   the   High   Court, <\/p>\n
was   based   on   legislative   competence.   The   brewery   contended   that   section <\/p>\n
28A provided for levy of `excise duty’ and an equal amount  as additional  <\/p>\n
duty   on   `excess   wastage’   or   shortage   in   quantity   manufactured;   that   the <\/p>\n
legislative competence to levy excise duty is derived from Entry 51 of List II <\/p>\n
of   Seventh   Schedule   to   the   Constitution   :   “Duties   of   excise   on   …….(a) <\/p>\n
alcoholic liquors for human consumption”; that therefore, if excise duty or <\/p>\n
additional duty is to be levied under section 28A, the article that could be  <\/p>\n
subjected   to  duty   should   be   `an  alcoholic   liquor   for   human   consumption’;  <\/p>\n
that   the   term   `alcoholic   liquor   for   human   consumption’   means   a   liquor <\/p>\n
which could be taken by a human being `as it is’ without the need for any <\/p>\n
further process;  and that in regard to beer, that stage is reached only after <\/p>\n
fermentation   and   filtration   processes   are   completed.   It   was   submitted   that <\/p>\n
before   filtration,   the   product-in-process   was   not   an   alcoholic   liquor   for <\/p>\n
human   consumption   and   therefore   there   was   no   legislative   competence   to <\/p>\n
levy excise duty or additional duty on such product-in-process.<\/p>\n
                                                      28<\/span><\/p>\n
26.     This contention ignores the fact that Entry 51 should be read not only <\/p>\n
as   authorizing   the   imposition   of   an   excise   duty,   but   also   as   authorizing   a <\/p>\n
provision which prevents evasion of excise duty. This Court in Baldeo Singh  <\/p>\n
vs. CIT – 1961 (1) SCR 482, held as under :\n<\/p>\n<\/p>\n
        “……Under Entry 54 a law could of course be passed imposing a tax on a  <\/p>\n
        person on his own income. It is not disputed that under that entry a law <\/p>\n
        could also be passed to prevent a person from evading the tax payable on <\/p>\n
        his own income. As is well known the legislative entries have to be read  <\/p>\n
        in a very wide manner and so as to include all subsidiary and ancillary  <\/p>\n
        matters. So Entry 54 should be read not only as authorizing the imposition  <\/p>\n
        of   a   tax   but   also   as   authorizing   an   enactment   which   prevents   the   tax  <\/p>\n
        imposed   being   evaded.  If   it   were   not   to   be   so   read,   then   the   admitted  <\/p>\n
        power to tax a person on his own income might often be made infructuous  <\/p>\n
        by ingenious  contrivances.  Experience  has shown that  attempts  to evade <\/p>\n
        the tax are often made.”\n<\/p><\/blockquote>\n
                                                                             (emphasis supplied)<\/p>\n<\/blockquote>\n
27.     In   this   context,   we   may   also   consider   the   decision   of   this   Court   in <\/p>\n
Union of India vs. A. Sanyasi Rao and others<\/a> – 1996 (3) SCC 465, this Court <\/p>\n
considered   the   constitutionality   of   the   provisions   for   presumptive   tax   in <\/p>\n
sections 44-AC and 206-C of the Income Tax Act, 1961 for collecting tax on <\/p>\n
profits   and   gains   from   trading   in   alcoholic   liquor   for   human   consumption  <\/p>\n
(and other goods specified therein) at the stage of purchase on a presumptive <\/p>\n
basis.   The   respondents   therein   contended   that   the   said   sections   lacked <\/p>\n
legislative competence  as income tax was a tax on income,  while the levy <\/p>\n
under   section   44-AC   was   one   on   purchase   when   no   income   had   occurred <\/p>\n
                                                29<\/span><\/p>\n
and   that   the   tax   was   on   a   hypothetical   income   and   not   real   income.   This <\/p>\n
Court   held   that   the   object   in   enacting   sections   44-AC   and   206-C   was   to <\/p>\n
enable   the   Revenue   to   collect   the   legitimate   dues   of   the   State   from   the <\/p>\n
persons   carrying   on   particular   trades,   in   view   of   the   peculiar   difficulties  <\/p>\n
experienced in the past and the measure was so enacted to check evasion of <\/p>\n
substantial revenue due to the state.  Trade or business, results in or produce <\/p>\n
income,   which   can   be   brought   to   tax.   In   order   to   prevent   evasion   of   tax <\/p>\n
legitimately due on such `income’, section 44-AC and section 206-C were <\/p>\n
enacted,   so   as   to   facilitate   the   collection   of   tax   on   that   income   which   is <\/p>\n
bound to arise or accrue, at the very inception itself or at an anterior stage  <\/p>\n
and   therefore   one   cannot   contend   that   the   aforesaid   statutory   provisions <\/p>\n
lacked legislative competence.  After all, statutory provisions obliging to pay <\/p>\n
`advance   tax’   were   not   new   and   sections   44-AC   and   206-C   were   similar. <\/p>\n<\/blockquote>\n
The standard by which the amount of tax was measured, being the purchase <\/p>\n
price,   would not in   any way alter the nature and basis of   the   levy   viz.,  <\/p>\n
that  the tax  imposed  was  a tax  on income  and  it  could not  be labelled <\/p>\n
as  a  tax  on  purchase of goods.  The  charge for the  levy of the income that  <\/p>\n
accrued or arose is laid  by the charging  sections viz., sections  5 to 9  and  <\/p>\n
not  by  virtue of section  44-AC or section 206-C.  The fact  that the  income  <\/p>\n
was  levied  at  a  flat  rate  or  at  an  earlier  stage  will  not   in  any way  <\/p>\n
                                                    30<\/span><\/p>\n
alter the nature or character of the levy since such matters are completely in  <\/p>\n
the realm of legislative wisdom.  What is brought to tax, though levied with <\/p>\n
reference to the purchase price and at an earlier point is nonetheless income  <\/p>\n
liable   to   be   taxed   under   the   Income   Tax   Act.   This   Court   referring   to   the <\/p>\n
argument about absence of legislative competence to levy tax before accrual <\/p>\n
of  income,   referred  to   Entry   82   of  List   I  of  Seventh   Schedule   (“Taxes  on <\/p>\n
income other than agricultural income”) and held as under :   <\/p>\n
        “…the   word   `income   occurring   in   Entry   82   in   List   I   of   the   Seventh <\/p>\n
        Schedule should be construed liberally and in a very wide manner and the <\/p>\n
        power to legislate will take in all incidental and ancillary matters including <\/p>\n
        the   authorization   to   make   provision   to   prevent   evasion   of   tax,   in   any <\/p>\n
        suitable manner.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
28.     To ensure that there is no evasion of excise duty in regard to any beer <\/p>\n
manufactured, the State is entitled to make a provision to prevent evasion of <\/p>\n
excise duty being evaded, though it is leviable at the stage of issue from the <\/p>\n
brewery.   The   beer   brewing   process   shows   once   the   wort   ferments,   it <\/p>\n
becomes consumable, though the manufacturing process to have a finished <\/p>\n
product   may   in   some   cases   require   filtration,   aging   carbonization   etc.   To <\/p>\n
ensure that there is no evasion of excise duty by diversion of beer (excisable <\/p>\n
article)   before   it   becomes   a   finished   product,   section   28A   of   the   Act   has <\/p>\n
been enacted and that is implemented by Rule 53 of the Brewery Rules, and <\/p>\n
                                                      31<\/span><\/p>\n
Rule 7 of the Bottling Rules. The Excise Inspector in-charge is required to <\/p>\n
take physical stock of the beer in hand in the brewery periodically (once a <\/p>\n
quarter prior to the amendment of 1975 and once in a month from July 1975) <\/p>\n
by   dip   and   gravity   of   the   quantities   in   the   fermentation   vessels.   We   may <\/p>\n
illustrate   the   method   adopted   to   ascertain   whether   there   is   any   excess <\/p>\n
manufacturing   wastage   (or   illegal   siphoning   of  beer)   before   it   reaches   the <\/p>\n
bottling tanks :\n<\/p>\n
\na.          The opening balance (actual quantity)                                          1000 Litres<\/p>\n
b.          Quantity brewed during the month under survey                                  2600 Litres<\/p>\n
c.          Total stock of beer        (a + b) in the brewery                              3600 Litres<\/p>\n
d.          Quantity of beer issued during the month                                       2600   Litres<\/p>\n
e.          Balance quantity in hand as per stock account (c – d)                          1000 Litres<\/p>\n
f.          Actual balance found on physical examination                                   600 Litres <\/p>\n
g.          Wastage in manufacture (difference between quantity shown<\/p>\n
            in stock account and actual quantity in the brewery)                           400 Litres<\/p>\n
h.          Wastage allowable at 9%* of the total stock of <\/p>\n
            beer in the month(3600 litres) under Rule 53 of Brewery                        324 Litres<\/p>\n
            *(9%   is   the   allowance   towards   losses   due   to   evaporation,   sullage   and   other  <\/p>\n
            contingencies within the brewery).\n<\/p>\n
      i.        Excess wastage chargeable to duty & addl. duty (g + h)                              76 <\/p>\n
                Litres <\/p>\n
                                             32<\/span><\/p>\n
29.    It should be noted that recourse to section 28A of the Act will be held <\/p>\n
only when there is abnormal deficiency or shortage in the actual quantity in <\/p>\n
the brewery when compared to the quantity mentioned in the stock account, <\/p>\n
that   is   more   than   9%,   which   would   show   evasion   of   excise   duty.  The <\/p>\n
standard procedure of levying excise duty is not on the quantity of excisable <\/p>\n
article in the fermentation vessels. The standard procedure is to levy excise <\/p>\n
duty   when   the   beer   is   removed   from   the   brewery.   The   State   was   thus <\/p>\n
collecting excise duty in the usual course with reference to the beer after the <\/p>\n
entire   manufacturing   process   was   completed   when   it   is  removed   from  the <\/p>\n
brewery. It resorted to section 28A, Rule 53 of Brewery Rules and Rule 7 of <\/p>\n
Bottling Rules and levied double the amount of excise duty (excise duty plus <\/p>\n
equal   amount   as   additional   duty)   only   in   those   months   when   the   periodic <\/p>\n
examination   showed   excessive   manufacturing   `wastage’.   The   procedure <\/p>\n
adopted was the most logical process to ensure that excisable articles were <\/p>\n
not clandestinely removed  and to ensure that there is no evasion of excise <\/p>\n
duty having regard to the brewing procedure. If the actual stock assessed is <\/p>\n
less than the stock as per Stock Account and the difference is less than 9%, <\/p>\n
the difference was ignored. Only if the difference exceeded 9%, the quantity <\/p>\n
in excess of 9% was treated as the excess wastage and excise duty and an <\/p>\n
equal amount as additional duty was charged in regard to such excess. For <\/p>\n
                                               33<\/span><\/p>\n
this purpose  necessarily  the quantity  in the fermentation  vessels had to be <\/p>\n
considered. If the quantity in the bottling tanks are to be taken as the basis, <\/p>\n
then there will be no way of finding out whether there was any siphoning off <\/p>\n
from the fermentation vessel or during filtration process. Fermented wort is <\/p>\n
beer and it could be removed from fermenting vessels or during storage or <\/p>\n
filtration.   Therefore,   the   base   measurement   is   taken   in   the   fermentation <\/p>\n
vessel and 9% standard allowance is provided to cover losses on account of <\/p>\n
sullage etc. <\/p>\n
30.     The Act provides that levy of excise duty on beer can not only be with <\/p>\n
reference to the quantity produced and issued from a brewery, but can also <\/p>\n
be   by   calculating   the   quantity   of   materials   used   or   by   the   degree   of <\/p>\n
attenuation of the wash or wort, as the case may be, as the State Government  <\/p>\n
may prescribe. This means the excise duty on the beer manufactured can be <\/p>\n
levied not only with reference to the actual quantity issued or removed, but <\/p>\n
can   also   be   by   a   rate   charged   in   accordance   with   a   scale   of   equivalent, <\/p>\n
calculated on the quantity of materials used or by the degree of attenuation <\/p>\n
of the wash or wort prescribed by the State Government. The said alternative <\/p>\n
method   of   levying   excise   duty   does   not   depend   upon   the   actual   quantity <\/p>\n
manufactured   or   issued.   It   is   with   reference   to   the   deemed   quantity <\/p>\n
                                                    34<\/span><\/p>\n
manufactured   rather   than   the   actual   quantity   manufactured.   Such   a <\/p>\n
procedure has been in vogue in England and it is permissible in India. Rule <\/p>\n
42 of Chapter XI of the Excise Manual (Vol. 5) gives a detailed description <\/p>\n
of the attenuation method of charging duty on beer and it is extracted below:<\/p>\n
      “42.  The   attenuation   method   of   charging   duty   on   beer.   –   In   the   United <\/p>\n
      Kingdom, the duty is levied on beer in proportion to the original gravity of <\/p>\n
      the wort. Really speaking, the Excise   control of breweries  is much less <\/p>\n
      stringent   than   in   the   case   of   distilleries.   No   excise   locks   are   used.   The <\/p>\n
      constant presence of an officer is only considered necessary in the case of <\/p>\n
      every   large   breweries   working   continuously.   The   safety   of   the   revenue <\/p>\n
      depends   on   notices   of   all   essential   operations   which   are   required   to   be <\/p>\n
      given   to   the   Excise.   The   length   of   notice   to   be   given   depends   on   the <\/p>\n
      importance of the particular operation and on the facility with which the <\/p>\n
      local officer can attend. One officer is, in general, in charge of a group of <\/p>\n
      the smaller breweries.\n<\/p><\/blockquote>\n
\n      A brewer must give timely notice of –\n<\/p><\/blockquote>\n
<\/blockquote>\n
          (1)  his attention to brew;\n<\/p><\/blockquote>\n
          (2)  the nature and amount of materials to be used; <\/p>\n
          (3)  the time at which he expects his mash-tun to be drained (this is to <\/p>\n
               enable the officer to take a dip of the drained grains which must lie  <\/p>\n
               for two hours after draining or until the officer arrives). <\/p>\n
          (4)  his intention to mix the products of one or more brewings;<\/p>\n
          (5)  any modification in his routine methods of brewing;<\/p>\n
          (6)   any   alterations   he   proposes   to   make   in   the   position   etc.,   of   his <\/p>\n
               brewing vessel;\n<\/p><\/blockquote>\n
          (7)  Finally and  most   important   of all,   the  brewer  is  required  to  give <\/p>\n
               notice to the officer of his intention to `collect beer’, ie., he must <\/p>\n
               intimate as closely as possible the time when the wort will be ready <\/p>\n
               for   pitching   with   yeast.   When   the   wort   is   collected   for <\/p>\n
               fermentation   the   brewer   must   forthwith   take   the   specific   gravity <\/p>\n
               with his saccharometer and also the dip, in order that the density <\/p>\n
               and gallonage may be recorded in case the officer does not attend. <\/p>\n
               In   cases   where   the   officer   attends   before   fermentation   has <\/p>\n
               materially affected the gravity he is able to verify these figures and <\/p>\n
               above   all   to   see   that   they   have   been   recorded   properly   by   the <\/p>\n
               brewer.\n<\/p><\/blockquote>\n
\n                                                     35<\/span><\/p>\n<\/blockquote>\n<\/blockquote>\n
       In order that his control may be effective, the officer must time his visits <\/p>\n
       to the brewery so as to arrive when fermentation has not advanced too far <\/p>\n
       for   check   and   so   that   the   brewer   has   had   reasonable   time   to   make   his <\/p>\n
       entries of gravity and gallonage. If having had reasonable time, the brewer <\/p>\n
       has   failed   to   make   his   entry  this   omission   is   treated   as   a  serious   excise <\/p>\n
       offence.\n<\/p><\/blockquote>\n
\n       It may be asked why stress is not laid on the necessity for the attendance <\/p>\n
       of the officer at the time of pitching the wort. This, bowever, is generally <\/p>\n
       impracticable  seeing  that  usually brewers  `collect’  at the  same  hour and <\/p>\n
       that the presence   of the officer at more than one brewery is impossible.  <\/p>\n
       This being so, his visits must be unexpected, the responsibility for honest <\/p>\n
       declaration of gravity and dip being imposed on the brewer. The brewer’s <\/p>\n
       records, if confirmed by the officer, are thus the basis on which the duty is <\/p>\n
       levied.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
31.    This Court in Haryana Brewery Ltd. (supra) recognized the alternative <\/p>\n
method   of   calculating   the   quantity   of   beer   manufactured   to   be   valid.   This <\/p>\n
Court held:\n<\/p>\n<\/p>\n
       “The proviso to Section 32 uses the expression “provided that duty may be <\/p>\n
       levied…..” Clause (b) of the proviso state that the calculation of the  beer  <\/p>\n
       manufactured  would be according to such scale or equivalents calculated <\/p>\n
       on  the   quantity  of  materials   used  or  by  the  degree  of  attenuation  of  the <\/p>\n
       wash or wort. The opening part of Clause (b) of the proviso indicates as to  <\/p>\n
       how   the   beer   manufactured   is   to   be   determined.   The   proviso   is   only   a <\/p>\n
       manner of computing the end-product with reference tot he raw material <\/p>\n
       which has been used in the input. The tax is on the end-product and not on  <\/p>\n
       the   raw   material.   What   this   proviso   read   with   Rule   35   indicates   that   in <\/p>\n
       order to determine what is the quantity of beer manufactured which is fit <\/p>\n
       for human consumption,  after all the processes have been gone through, <\/p>\n
       you seen what is the quantity of raw material which has been utilised for <\/p>\n
       the   manufacture   of   beer   and   in   the   process   of   manufacturing   give   an <\/p>\n
       allowance for wastage of 7 per cent. After doing this, you determine the  <\/p>\n
       quantity of beer manufactured. An example which has been given is that a <\/p>\n
       1000 kgs. Of malt should ordinary yield 6500 litres of beer. By giving an <\/p>\n
       allowance   of   wastage   which   must   occur   during   the   process   of   the <\/p>\n
       manufacture of the end-product and limiting that allowance to 7 per cent, <\/p>\n
       the quantity of beer manufactured on which excise duty would be levied  <\/p>\n
       would be 6500 litres less 7 per cent.\n<\/p><\/blockquote>\n
\n                                                    36<\/span><\/p>\n<\/blockquote>\n
       14. It appears to us that the proviso to Section 32 read with Rule 35 does <\/p>\n
       nothing   more   than   to  give   a  rough   and   ready   method   of  calculating   the <\/p>\n
       quantum   of   beer   which   should   have   been   manufactured   in   the   normal <\/p>\n
       process   which   is   calculated   on   the   basis   of   the   raw   material   used.   The <\/p>\n
       idea,   perhaps,   is   that   full   quantity   of   beer   which   is   manufactured   is <\/p>\n
       accounted   for.   It   will   be   seen   that   registers   are   maintained   by   the <\/p>\n
       manufacturer and the figures are taken from there. From the records of the <\/p>\n
       manufacturer, excise authorities  will be able to ascertain the quantum of <\/p>\n
       raw material used. It is open to the excise authorities to accept the figure  <\/p>\n
       indicated in the records of the manufacturer of the total quantity of beer <\/p>\n
       manufactured. Duty can be levied on this and this would be inconsonance <\/p>\n
       with the first part of Section 32. It is, perhaps, only to cross-check whether <\/p>\n
       the figure which is indicated in the books of the manufacturer is correct <\/p>\n
       that a formula can be used for determining the amount of beer which could <\/p>\n
       or should or must have been manufactured. This is by taking into account  <\/p>\n
       the quantity of raw material used, the quantity which is in the process and <\/p>\n
       as entered in the brewing book and from there giving an allowance of 7 <\/p>\n
       per cent for wastage. It appears to us that the allowance of 7 per cent has <\/p>\n
       to be in arriving at the figure of the manufactured beer as loss of quantity <\/p>\n
       during   the   process   of   manufacture.   It   cannot   be   that   on   the   figure   of <\/p>\n
       manufactured beer, arrived at on the basis of the books of the respondent, <\/p>\n
       an allowance of 7 per cent has then to be given. If the figure taken for the  <\/p>\n
       purpose of calculating the excise duty is only of the end-product, viz., the <\/p>\n
       beer   produced,   and   not   the   quantity   of   raw   material   used   in   the <\/p>\n
       manufacture of beer during which loss of some quantity as wastage would <\/p>\n
       have occurred, there cannot  be a deduction of any sum or proportion as <\/p>\n
       wastage from the quantity of end-product in order to arrive at the quantity. <\/p>\n
       The excisable product is the quantity of beer produced and not the quantity <\/p>\n
       produced, and thus excisable, minus 7 per cent.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
Therefore   there   is   nothing   wrong   in   adopting   the   procedure   prescribed   in <\/p>\n
section   28A   and   Rule   53   of   Brewery   Rules   to   determine   the   excess <\/p>\n
manufacturing wastage.\n<\/p>\n<\/p>\n
32.    The   Brewery   wants   the   wastage   allowance   to   be   given,   not   with <\/p>\n
reference to the quantity in the fermentation tank, but with reference to the <\/p>\n
quantity in the storage\/bottling tanks (after completion of fermentation and <\/p>\n
                                                    37<\/span><\/p>\n
filtration   process)   when   the   manufacturing   process   is   complete   and   only <\/p>\n
bottling remains.  The argument   of  the respondent  is that  the  measurement <\/p>\n
should be taken only when the manufacture is complete and not when it is <\/p>\n
still in the process of manufacture; and the manufacture process is completed <\/p>\n
not when the wort is in the fermentation  tank but only when the filtration  <\/p>\n
process   is   finished.   But   this   contention   ignores   the   fact   that   when <\/p>\n
manufacturing process is complete and the beer has reached storage\/bottling <\/p>\n
tanks, there is no question of any manufacturing loss. The allowance of 9% <\/p>\n
is   made   to   cover   loss   due   to   evaporation,   sullage   and   other   contingencies <\/p>\n
within the brewery. 9% is allowed as loss in quantity because the quantity in <\/p>\n
fermentation   tank   is   measured   and   taken   as   the   base   and   thereafter   the <\/p>\n
sullage\/yeast heads are removed as sediment in the fermentation vessels or <\/p>\n
by the filtration process and there will also be certain amount of evaporation <\/p>\n
during the process of filtration, racking and storage etc. In fact, the Brewery <\/p>\n
specifically   admits   this   position   in   Annexure-I   to   the   writ   petition   while  <\/p>\n
describing the process of manufacturing beer :\n<\/p>\n<\/p>\n
       “From   the   above   brief   description   of   manufacturing   process,   it   will   be <\/p>\n
       observed   that   the   deficiency   between   the   quantity   of   wort   to   the   point <\/p>\n
       when   beer   is   ready   for   bottling,   occurs   because   of   elimination   of <\/p>\n
       impurities” viz., yeast cells and dirty heads brought up in fermentation at <\/p>\n
       top,   evaporation   taking   place;   carbon   dioxide   evolved   out;   and   sullage <\/p>\n
       settled at the bottom. The quantity of these impurities accounting for the <\/p>\n
       said deficiency in the process of manufacture cannot be taken as beer and <\/p>\n
       excisable   article   for   purposes   of   levy   of   duty.   For   culmination   of   these <\/p>\n
                                                38<\/span><\/p>\n
        impurities and other contingencies mentioned of in rule 912, an allowance <\/p>\n
        of 10% is fixed.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
33.     If   the   quantity   measured  after   the   fermentation   and   filtration  <\/p>\n
processes  should be the base figure, for purpose of allowance to cover loss <\/p>\n
on account  of sullage,  evaporation etc., there will be no need for granting <\/p>\n
any   allowance   because   once   it   have   passed   the   filtration   stage   the   sullage <\/p>\n
and other impurities has been removed and the beer is ready for being filled <\/p>\n
in barrels, casks or bottles. The 9% allowance is for the wastages occurring <\/p>\n
during   the   stages   of   fermentation   and   filtration   and   not   in   regard   to   the <\/p>\n
stages   between   storage   after   filtration   and   removal.   The   Brewery   has <\/p>\n
virtually   mixed   up   the   issue   relating   to   the   question   as   to   when   beer   is <\/p>\n
exigible   to   excise   duty   with   the   question   as   to   the   quantity   on   which   the <\/p>\n
allowance of 9% should be granted. As noticed above, a combined reading <\/p>\n
of rules 37 and 53 of Breweries Rules, with or without section 28A make it <\/p>\n
clear that the allowance of 9% as losses in the brewery (10% as losses in the <\/p>\n
course of manufacture in the brewery prior to 1975) is with reference to the <\/p>\n
quantity in the fermentation tank and not with reference to the quantity of <\/p>\n
beer in the storage\/bottling tanks after filtration. <\/p>\n
                                                       39<\/span><\/p>\n
34.     We may now consider the contention on behalf of brewery  that they <\/p>\n
are entitled to allowance upto 9% towards such wastage from the quantity <\/p>\n
measured in the storage\/bottling tanks after fermentation and filtration. We <\/p>\n
extract   below   the   contention   of   the  Brewery   in   this   behalf   from   its   writ <\/p>\n
petition:\n<\/p>\n<\/p>\n
        “(X)     That   section   28A(2)   in   so   far   as   it   purports   to   provide   for <\/p>\n
        permissible   wastage   could   operate   only   from   the   stage   the   State <\/p>\n
        Government became competent to impose excise duty\/additional duty and <\/p>\n
        till   beer   is   brought   to   such   a   stage   that   it   is   rendered   fit   for   human  <\/p>\n
        consumption, the State Legislature has no legislative competence to levy <\/p>\n
        excise   duty\/additional   duty   and   hence   the   State   Legislature   cannot   take <\/p>\n
        into consideration for the purposes of levy of excise duty\/additional duty <\/p>\n
        any wastage prior to the stage when the liquor\/beer becomes fit for human  <\/p>\n
        consumption.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
A   large   allowance   up   to   9%   of   the   total   stock   of   beer   has   been   provided <\/p>\n
towards wastage, only to cover the loss occurring from fermentation stage to <\/p>\n
post-filtration stage, as the quantity has been calculated with reference to the <\/p>\n
fermentation vats and there will be considerable wastage due to sullage and <\/p>\n
evaporation. Rules 37 and 53 of the Breweries Rules (paras 896 and 912 of <\/p>\n
the Excise Manual) also proceeded on that basis that the measurement would <\/p>\n
be with reference to the quantities in the fermentation vessels taken by dip <\/p>\n
and gravity method.\n<\/p>\n
\n                                                          40<\/span><\/p>\n
35.          In fact, the brewery describes the nature of these losses in the brewery <\/p>\n
in Annexure I to the writ petition (in the connected WP No.1375\/1978) as <\/p>\n
under:\n<\/p>\n<\/p>\n
         “MANUFACTURING LOSSES<\/p>\n
(i)               Varying constituents of Malt viz. percentage of proteins etc. produced <\/p>\n
sludge or sullage in more or less quantity. Thus sullage to be removed will have  <\/p>\n
differing percentages.\n<\/p>\n<\/p>\n
(ii)              Depending   on   the   process   –   top   and   bottom   fermentation   etc.   there <\/p>\n
may be more or less of scum and dirty heads containing yeast cells to be removed, <\/p>\n
thus losses will be variable at this stage.\n<\/p>\n<\/p>\n
(iii)             The removal of solids is continuously carried on at different stages in <\/p>\n
the   manufacturing   process.   With   frequency   of   the   centrifugal   machines   or   the <\/p>\n
Filtration Plants having to be opened depending upon the quantity and turbidity of <\/p>\n
the   fermented   wort   or   green   beer   to   be   cleared   off   to   be   sparklingly   clear,   the  <\/p>\n
losses will be more or less. With the banking of import of quality filter sheets, the <\/p>\n
indigenously made filter sheets have to be used which are to be more frequently <\/p>\n
changed then the imported ones. There are losses in absorption in filter sheets and <\/p>\n
leakage at ends of plates.\n<\/p>\n<\/p>\n
(iv)              Some quantity of fermenting wort is lost in removal of scum and dirty <\/p>\n
heads and in removal of sullage from the bottom of the tanks.<\/p>\n
(v)               Every   time   the   fermenting   or   fermented   wort   or   green   beer   is <\/p>\n
transferred   by means  of  pipes, what  is   left  over  in  pipes  has   to  be drained   off, <\/p>\n
water   and   steam   is   run   in   pipes   to   sterilize   them,   so   that   there   may   be   no <\/p>\n
contamination to spoil beer.\n<\/p>\n<\/p>\n
         The varying losses at each stage in the manufacturing process are natural and <\/p>\n
         unavoidable. With the above mentioned variable losses, accidental, off chance <\/p>\n
         occurrence or those losses which are incidental to the process of manufacture <\/p>\n
         are provided for in rule 912 under “Contingencies”.\n<\/p>\n
\n         The   contingent   losses,  a   few   of  which   are   given   below,   make   the   losses   in <\/p>\n
         manufacturing process vary and erratic.\n<\/p>\n
\n                                                   41<\/span><\/p>\n
(a)         Due   to   failure   of   electricity   and   refrigeration,   there   may   be   brisk <\/p>\n
fermentation  and wild bacterial  infection,  which may make  it sour to be turned <\/p>\n
into vinegar, or if more spoilt, may have to be destroyed.<\/p>\n
(b)         By sudden leakage of brine coiled pipes, the fermenting wort may be <\/p>\n
mixed up with brine which becomes unpalatable and has to be destroyed. <\/p>\n
(c)         With haziness persisting after filtration once, it may have to be treated <\/p>\n
with approved chemicals and refiltered.\n<\/p>\n<\/p>\n
(d)         Bursting of transfer pipes, leakage of valves etc.”<\/p>\n
36.     If the quantity measured in the storage\/bottling tanks (after filtration) <\/p>\n
should   form   the   basis,   there   was   no   occasion   or   need   for   making   a   huge <\/p>\n
allowance   of 9%  for  sullage,   evaporation  and  other  contingences,   as there <\/p>\n
would be no sullage, evaporation or other wastages after that stage (that is <\/p>\n
completion of manufacture) and the allowance under Section 28A of the Act <\/p>\n
will become redundant, except for the small percentage provided for wastage <\/p>\n
during bottling and storage.\n<\/p>\n<\/p>\n
37.     The Brewery  placed strong reliance upon the decision of this Court in <\/p>\n
State   of   U.P.   vs.   Modi   Distillery   &   Ors.<\/a>   –   1995   (5)   SCC   753.     In   that <\/p>\n
decision, this Court was considering the validity of demand for excise duty <\/p>\n
on the wastage of high strength spirit (80% to 85%) during transportation in <\/p>\n
containers   from   distillery   to   warehouse   (referred   to   as   `Group   B’   cases). <\/p>\n
This Court held :\n<\/p>\n
\n                                                      42<\/span><\/p>\n
       “In other words, ethyl alcohol (95 per cent) was not an alcoholic liquor for <\/p>\n
       human   consumption   but   could   be   used   as   a   raw   material   or   input,   after <\/p>\n
       processing   and   substantial   dilution   in   the   production   of   whiskey,   gin, <\/p>\n
       country  liquor  etc. In  the light of  experience  and  development,  it  was <\/p>\n
       necessary to state that `intoxicating liquor’ meant only that liquor which <\/p>\n
       was consumable by human beings as it was.\n<\/p><\/blockquote>\n
\n       What the State seeks to levy excise duty upon in the Group ‘B’ cases is the  <\/p>\n
       wastage of liquor after distillation, but before dilution; and, in the Group <\/p>\n
       ‘D’   cases,   the   pipeline   loss   of   liquor   during   the   process   of   manufacture, <\/p>\n
       before   dilution.   It   is   clear,   therefore,   that   what   the   State   seeks   to   levy <\/p>\n
       excise  duty upon is not alcoholic  liquor  for human  consumption  but the <\/p>\n
       raw material or input still in process of being rendered fit for consumption  <\/p>\n
       by human beings. The State is not empowered to levy excise duty on the <\/p>\n
       raw material or input that is in the process of being made into alcoholic <\/p>\n
       liquor for human consumption.”\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
The said decision will not assist the first respondent – brewery as that was a  <\/p>\n
case   of  levy  of  excise  duty  on  raw materials  or inputs  which  were  still  in <\/p>\n
process. That matter related to distilled alcohol and not fermented beer. The <\/p>\n
wastage considered by this Court was all with reference to alcohol that had <\/p>\n
not   been   diluted   and   therefore   was   not   `alcoholic   liquor   for   human <\/p>\n
consumption’. This Court held that the State is not empowered to levy duty <\/p>\n
on the raw material  or inputs that is in the process of being made  into an <\/p>\n
alcoholic   liquor   for   human   consumption.   The   position   is   different   here. <\/p>\n
When the quantity of the liquid in the fermentation vessels were measured, <\/p>\n
on   account   of   fermentation,   the   liquid   was   already   in   the   process   of <\/p>\n
                                           43<\/span><\/p>\n
conversion   into   an   `alcoholic   liquor   for   human   consumption’,   though   had <\/p>\n
not become a finished product of beer. Therefore, the principles in  Baldev  <\/p>\n
Singh and A. Sanyasi Rao, will apply and not the decision in Modi Distillery. <\/p>\n
Therefore we hold that there is no infirmity  in the method  adopted by the  <\/p>\n
excise department to arrive at the excess wastage or in making a demand for <\/p>\n
excise duty and additional duty in regard to such excess wastage.<\/p>\n
Re : CA No.4709 of 2002 :\n<\/p>\n<\/p>\n
38.    The question arising in this appeal is the same as in CA No.4708 of <\/p>\n
2002 and the facts are also similar to the facts of CA Nos.4708 of 2002. The <\/p>\n
only difference in facts is that the demand in this case related to the period <\/p>\n
3.6.1970   to   5.9.1972   and   the   amount   of   duty\/additional   duty   that   was <\/p>\n
demanded was Rs.1,40,596.89. For the reasons stated in CA No.4708\/2002, <\/p>\n
this appeal is also allowed.\n<\/p>\n
Re : CA Nos.4710, 4711, 4712, 4713 of 2002<\/p>\n
39.    All these four appeals relate to demands made upon the breweries for <\/p>\n
duty on excess wastage in bottling and storage of beer. The first appellant <\/p>\n
brewery has described the process of bottling of beer thus (in Annexure P2 <\/p>\n
to the writ petition – WP No.1375\/1978):\n<\/p>\n
\n                                                   44<\/span><\/p>\n
       “Before   carbonated   beer   is   conveyed   to   the   automatic   bottling   machine <\/p>\n
       through pipes, the whole line is cleaned and sterilized to ensure that there <\/p>\n
       are no wild bacteria which may spoil the beer passed through these pipes.<\/p>\n
       Bottles   which   are   cleaned   and   sterilized   in   Automatic   Bottle   Washing <\/p>\n
       Plant, are fed by conveyors to the beer bottling machine. While the bottles  <\/p>\n
       are filled, some quantity of beer is spilt by foaming which takes place and <\/p>\n
       with pressure of Co  gas bottles burst in the process of bottling. The beer
\n                               2<\/span><\/p>\n
       which is spilt is mixed with broken glass pieces, oil etc. on the conveyor <\/p>\n
       belts. It is contaminated and has to go waste.\n<\/p><\/blockquote>\n
\n       To   increase   the   shelf   life   of   beer,   the   filled   bottles   are   placed   in <\/p>\n
       pasteurization tanks and the water in which these bottles are immersed is <\/p>\n
       gradually raised to temperature of 65O and after keeping these bottles for a <\/p>\n
       fixed time in hot water, these are cooled down.\n<\/p><\/blockquote>\n
\n       With the expansion of Co  gas during this process some bottles burst and
\n                                       2<\/span><\/p>\n
       the beer contained therein gets mixed up with water. <\/p>\n
       Leaky bottles are also taken out from the pasteurization tanks, which are <\/p>\n
       decanted  for  reprocessing  of their  contents.   Some   wastage   occurs  in  the <\/p>\n
       process of decanting.\n<\/p><\/blockquote>\n
\n       After   pasteurization   of   filled   bottles,   capsuling,   labeling   and   packing   is <\/p>\n
       done,   in   which   some   bottles   break.   During   the   process   of   bottling   what <\/p>\n
       goes   waste   in   spilling   as   mentioned   above,   in   unavoidable.   It   does   not <\/p>\n
       exist in the form of goods for sale and human consumption. Thus being <\/p>\n
       not an excisable article is not leviable with duty.”<\/p>\n<\/blockquote>\n
The Breweries have also described the various instances of bottling wastages <\/p>\n
in the writ petition as under :\n<\/p>\n<\/p>\n
       “BOTTLING WASTAGES<\/p>\n
       The wastages occur at different stages in bottling process as under: <\/p>\n<\/blockquote>\n
       (a)      Loss   of   beer   in   transfer   pipe   from   Bottling   Tank   to   bottling <\/p>\n
       machine,  which has to be washed away to sterilize  pipes before bottling <\/p>\n
       operations are began every day.\n<\/p><\/blockquote>\n
\n                                                     45<\/span><\/p>\n<\/blockquote>\n
        (b)        There being pressure of CO gas in beer there is loss by bursting of
\n                                                    2  <\/span><\/p>\n
        bottles in filling and capping machines. With the pressure of gas foaming  <\/p>\n
        takes place and there is spillage of beer between the bottling and capping <\/p>\n
        machines. The spilt beer cannot be recovered as it gets mixed up with oil <\/p>\n
        on the conveyor belts and is contaminated.\n<\/p><\/blockquote>\n
<\/blockquote>\n
        (c)        There are some breakages on conveyors between capping machine <\/p>\n
        and pasteurization tanks.\n<\/p><\/blockquote>\n
<\/blockquote>\n
        (d)        During pasteurization the filled bottles are immersed in water and <\/p>\n
        the temperature  of water is gradually raised to about 650C after keeping <\/p>\n
        for a fixed time, it is gradually colled, with the expansion of gas the bottles <\/p>\n
        burst to a varying percentage depending on the varying quality of bottles <\/p>\n
        from mould to mould and batch to batch and beer is mixed with water in <\/p>\n
        the tanks.\n<\/p><\/blockquote>\n
<\/blockquote>\n
        (e)        Some   breakages   do   occur   in   capsuling,   labelling   and   packing   of <\/p>\n
        filled bottles.\n<\/p><\/blockquote>\n
<\/blockquote>\n
        (f)        Sometimes rebottling may have to be done and loss on this account <\/p>\n
        may occur.\n<\/p><\/blockquote>\n
\n<\/blockquote>\n
40.     The appellant breweries are holding bottling licences in form No.FL3 <\/p>\n
to bottle beer, governed by the U.P. Bottling of Foreign Liquor Rules, 1969  <\/p>\n
(`Bottling   Rules’   for   short).   Rule   6   provides   that   every   licence   granted   in <\/p>\n
Form No. FL3 shall be subject to the conditions enumerated therein. Rule 7  <\/p>\n
enumerates the additional special conditions applicable to bottling of India <\/p>\n
made liquor in bond under FL3 licence. Sub-rules (10) and (11) of Rule 7 <\/p>\n
are relevant for our purpose and they are extracted below :<\/p>\n
                 “7.   Following   additional   special   conditions   will   be   applicable   to <\/p>\n
               bottling of Indian Made Foreign liquor in bond under F.I.-3 licence:<\/p>\n
               (1) to (9)  x x x x x  omitted as not relevant <\/p>\n
               (10)  On  the  last  working,  day of  every  calendar   month,   after  all   the <\/p>\n
               transactions for that day are made, the Excise Inspector Incharge shall <\/p>\n
                                                      46<\/span><\/p>\n
            take   the   stock   of   unbottled   and   bottled   spirit   3rd   beer\/stored   in   the <\/p>\n
            bottling warehouse, enter into the prescribed registers and ascertain the <\/p>\n
            wastage of spirit in the bottling operations and storage in the bonded <\/p>\n
            warehouse.\n<\/p><\/blockquote>\n
\n            (11)  (a)  An  allowance   up to  one  per cent   may  be  made   on the  total <\/p>\n
            quantity   of   spirit   and   beer   stored   during   a   month   for   actual   loss   in <\/p>\n
            bottling and storage. The licensee shall be responsible for the payment <\/p>\n
            of duty on wastage in excess of one per cent,<\/p>\n<\/blockquote>\n
            (b) when the wastage does not exceed the prescribed limit, no action <\/p>\n
            need   be   taken   by   the   Excise   Inspector   Incharge   but   if   an   excess   is <\/p>\n
            found at the time  of monthly stock taking  the Excise Inspector shall <\/p>\n
            submit  a statement  to the  Collector  by the  fifth  day of the month  in <\/p>\n
            Form F.L.B. 10 showing the quantity of actual wastage and the duty to <\/p>\n
            be   paid   by   the   licensee   on   the   excess   wastage.   On   receipt   of   the <\/p>\n
            statement the Collector shall recover the duty from the licensee at the <\/p>\n
            full rate of duty leviable on Indian made foreign spirit and beer.”<\/p>\n<\/blockquote>\n
41.     The appellants contended that section 28A provides for an allowance <\/p>\n
of 10% to cover losses due to evaporation, sullage and other contingencies <\/p>\n
within the brewery and also to cover losses in bottling and storage. Rule 53 <\/p>\n
of   the   Brewery   Rules   as   amended   on   19.7.1975   (Rule   912   of   the   Excise <\/p>\n
Manual) provides for an allowance of 9% of the total stock  of beer in the <\/p>\n
month   to  cover  losses   due  to   evaporation,  sullage   and   other  contingencies <\/p>\n
within   the   brewery.   Rule   7(11)(a)   of   the   Bottling   Rules   provides   for   an <\/p>\n
allowance up to one per cent of the total stock of spirit during a month, for <\/p>\n
actual loss in bottling and storage. The appellants submitted that section 28A <\/p>\n
did   not   make   such   a   division   of   10%   allowance,   into   9%   for   loss   in   the <\/p>\n
brewery     and   one   percent   for   loss   in   bottling;   and   that   therefore   it   is <\/p>\n
                                                47<\/span><\/p>\n
impermissible   to   divide   the   wastage   under   two   separate   heads   of     9% <\/p>\n
wastage to cover losses due to evaporation, sullage and other contingencies <\/p>\n
within the brewery under rule 53 of the Brewery Rules, (para 912 of U.P. <\/p>\n
Excise Manual) and only one percent for losses in bottling and storage under <\/p>\n
the Bottling Rules. According to them the wastage in bottling can itself go to <\/p>\n
an   extent   of   10%.   At   all   events,   if   the   total   wastage   due   to   evaporation, <\/p>\n
sullage   and   other   contingencies   in   the   brewery   and   the   total   wastage   in <\/p>\n
bottling and storage, together did not exceed 10%, no duty or additional duty <\/p>\n
could be levied on the assumption that the losses in bottling and storage was <\/p>\n
restricted only to one percent, as such division would be contrary to section <\/p>\n
28A of the Act.\n<\/p>\n<\/p>\n
42.     Rule   53   of   Brewery   Rules   made   in   1961   (para   912   of   the   Excise <\/p>\n
manual)   before   the   amendment   on   19.7.1975   provided   for   allowance   of   a <\/p>\n
deficiency   not   exceeding   10%   to   cover   losses   in   bulk   due   to   evaporation, <\/p>\n
sullage and other contingencies within the brewery. At that time a separate <\/p>\n
licence for bottling was not contemplated. The Bottling Rules made in 1969 <\/p>\n
provided  for   an   allowance   of  one   percent   loss   in   bottling  and   storage.   On <\/p>\n
19.7.1975,   Rule   53   (para   912   of   Excise   manual)   was   substituted   and   the <\/p>\n
allowance   to   cover   losses   due   to   evaporation,   sullage   and   other <\/p>\n
                                                48<\/span><\/p>\n
contingencies   within   the   brewery   was   reduced   to   9%   in   view   of   the <\/p>\n
provision in the Bottling Rules providing for an allowance of one percent for <\/p>\n
losses  in  bottling  and  storage. Section  28A  was  inserted  by  U.P. Act  9  of <\/p>\n
1978 (with a provision that the section shall be deemed always to have been  <\/p>\n
inserted)   providing   for  an   allowance   to  a   total  extent   of  10%  in   regard   to <\/p>\n
losses within the brewery and the losses in bottling and storage. It is not in <\/p>\n
dispute that the process of brewing beer and the process of bottling beer are <\/p>\n
considered to be distinct and separate processes governed respectively by the <\/p>\n
Brewery Rules and Bottling Rules. The operations connected with bottling <\/p>\n
are required to be conducted in a separate premises under a different licence. <\/p>\n
The   process   of   bottling   begins   with   the   transfer   of   bulk   beer   from   the <\/p>\n
brewery for bottling. Sub-section (2) of section 28A refers to an allowance <\/p>\n
to an extent of 10% not only in regard to losses within the brewery but also  <\/p>\n
to   cover   losses   in   bottling   and   storage.   As   noticed   above,   Rule   53   of   the <\/p>\n
Brewery Rules and Rule 7(11) of the Bottling Rules when read conjointly <\/p>\n
show   that   the   said   rules   are   supplementary   to   each   other   and   together <\/p>\n
implement section 28A of the Act.  At all events, the validity of neither Rule  <\/p>\n
53 of Brewery Rules nor Rule 7(11) of Bottling Rules is under challenge. Be <\/p>\n
that as it may.\n<\/p>\n
\n                                               49<\/span><\/p>\n
43.     The brewery having obtained the bottling licence subject to the special <\/p>\n
conditions which include the condition in Rule 7(11) of the Bottling Rules, <\/p>\n
cannot   ignore   the   said   Rule   and   contend   that   the   allowance   for   losses   in <\/p>\n
bottling could be more than one percent, that is upto ten per cent. In view of  <\/p>\n
the above there is no merit in the contention of the breweries that they are <\/p>\n
entitled to allowance of ten per cent towards losses in bottling and storage <\/p>\n
after   the   excisable   article   has   left   the   Brewery.   The   appeals   are   therefore <\/p>\n
liable to be dismissed.\n<\/p>\n
Conclusion :\n<\/p>\n<\/p>\n
44.     CA Nos.4708-4709\/2002 are allowed and the order of the High Court <\/p>\n
in Civil Misc. WP Nos.3968\/1978 and 4043\/2008 are set aside and the said <\/p>\n
writ petitions are dismissed.\n<\/p>\n<\/p>\n
45.     CA Nos.4710, 4711, 4712 & 4713\/2002 are dismissed affirming the <\/p>\n
decision   of   the   High   Court   dismissing   C.M.   W.P.   Nos.1375\/1978, <\/p>\n
3690\/1979,   4136\/1978   and   4157\/1978,   though   for   reasons,   somewhat <\/p>\n
different from the reasoning of the High Court.\n<\/p>\n<\/p>\n
                                                                  ………………………..J<\/p>\n
                                                                        (R. V. Raveendran)<\/p>\n
                          50<\/span><\/p>\n
                                ………………………..J<\/p>\n
                                    (P. Sathasivam)<\/p>\n
New Delhi;\n<\/p>\n
September 23, 2011.\n<\/p><\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011 Author: R V Raveendran Bench: R.V. Raveendran, P. Sathasivam Reportable IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NOs. 4708-4709 OF 2002 State of U.P. & Ors. … Appellants Vs. M\/s […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-191584","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nState Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\" \/>\n<meta property=\"og:site_name\" content=\"Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/LegalindiaCom\/\" \/>\n<meta property=\"article:published_time\" content=\"2011-09-22T18:30:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2016-07-07T06:11:11+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1\" \/>\n\t<meta property=\"og:image:width\" content=\"512\" \/>\n\t<meta property=\"og:image:height\" content=\"512\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Legal India Admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@legaliadmin\" \/>\n<meta name=\"twitter:site\" content=\"@Legal_india\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Legal India Admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"70 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\"},\"author\":{\"name\":\"Legal India Admin\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\"},\"headline\":\"State Of U.P. & Ors vs M\\\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011\",\"datePublished\":\"2011-09-22T18:30:00+00:00\",\"dateModified\":\"2016-07-07T06:11:11+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\"},\"wordCount\":13984,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"articleSection\":[\"Supreme Court of India\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\",\"name\":\"State Of U.P. & Ors vs M\\\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\"},\"datePublished\":\"2011-09-22T18:30:00+00:00\",\"dateModified\":\"2016-07-07T06:11:11+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"State Of U.P. & Ors vs M\\\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"name\":\"Free Judgements of Supreme Court & High Court | Legal India\",\"description\":\"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"alternateName\":\"Free judgements of Supreme Court & High Court of India | Legal India\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\",\"name\":\"Judgements of Supreme Court & High Court | Legal India\",\"alternateName\":\"Legal India\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"contentUrl\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"width\":512,\"height\":512,\"caption\":\"Judgements of Supreme Court & High Court | Legal India\"},\"image\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/LegalindiaCom\\\/\",\"https:\\\/\\\/x.com\\\/Legal_india\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\",\"name\":\"Legal India Admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"caption\":\"Legal India Admin\"},\"sameAs\":[\"https:\\\/\\\/www.legalindia.com\",\"https:\\\/\\\/x.com\\\/legaliadmin\"],\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/author\\\/legal-india-admin\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","og_locale":"en_US","og_type":"article","og_title":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India","og_url":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","og_site_name":"Free Judgements of Supreme Court & High Court | Legal India","article_publisher":"https:\/\/www.facebook.com\/LegalindiaCom\/","article_published_time":"2011-09-22T18:30:00+00:00","article_modified_time":"2016-07-07T06:11:11+00:00","og_image":[{"width":512,"height":512,"url":"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1","type":"image\/jpeg"}],"author":"Legal India Admin","twitter_card":"summary_large_image","twitter_creator":"@legaliadmin","twitter_site":"@Legal_india","twitter_misc":{"Written by":"Legal India Admin","Est. reading time":"70 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#article","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011"},"author":{"name":"Legal India Admin","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea"},"headline":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011","datePublished":"2011-09-22T18:30:00+00:00","dateModified":"2016-07-07T06:11:11+00:00","mainEntityOfPage":{"@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011"},"wordCount":13984,"commentCount":0,"publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"articleSection":["Supreme Court of India"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","url":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011","name":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & ... on 23 September, 2011 - Free Judgements of Supreme Court & High Court | Legal India","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/#website"},"datePublished":"2011-09-22T18:30:00+00:00","dateModified":"2016-07-07T06:11:11+00:00","breadcrumb":{"@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.legalindia.com\/judgments\/state-of-u-p-ors-vs-ms-mohan-meakin-breweries-ltd-on-23-september-2011#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.legalindia.com\/judgments\/"},{"@type":"ListItem","position":2,"name":"State Of U.P. & Ors vs M\/S. Mohan Meakin Breweries Ltd. & … on 23 September, 2011"}]},{"@type":"WebSite","@id":"https:\/\/www.legalindia.com\/judgments\/#website","url":"https:\/\/www.legalindia.com\/judgments\/","name":"Free Judgements of Supreme Court & High Court | Legal India","description":"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.","publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"alternateName":"Free judgements of Supreme Court & High Court of India | Legal India","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.legalindia.com\/judgments\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.legalindia.com\/judgments\/#organization","name":"Judgements of Supreme Court & High Court | Legal India","alternateName":"Legal India","url":"https:\/\/www.legalindia.com\/judgments\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/","url":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","contentUrl":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","width":512,"height":512,"caption":"Judgements of Supreme Court & High Court | Legal India"},"image":{"@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/LegalindiaCom\/","https:\/\/x.com\/Legal_india"]},{"@type":"Person","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea","name":"Legal India Admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","caption":"Legal India Admin"},"sameAs":["https:\/\/www.legalindia.com","https:\/\/x.com\/legaliadmin"],"url":"https:\/\/www.legalindia.com\/judgments\/author\/legal-india-admin"}]}},"modified_by":null,"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/191584","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/comments?post=191584"}],"version-history":[{"count":0,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/191584\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/media?parent=191584"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/categories?post=191584"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/tags?post=191584"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}