V S NARAYANASWAMY Vs. STATE OF MYSORE

JUDGEMENT

(1.) In this petition under Art.226 of the Constitution, the petitioner has prayed for- (i) striking down Clause,(d) of Sec.23 of the Karnataka Excise Act, 1965, (hereinafter referred to as 'the Act') as ultra vires of the State Legislature; (ii) striking down sub-rule (1) of Rule 8 of the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968, (hereinafter referred to as 'the Rules') as ultra vires of the powers of the State Govt. and " (iii) directing the respondents (the State of Karnataka and the Excise Authorities in Karnataka) to refund to the petitioner the amounts collected from it as license fee under Rule 8(1) of the Rules.

(2.) The petitioner is a partnership firm. Though it has not been expressly stated so in the petition, Mr N. Santhosh Hegde, learned Counsel for the petitioner, submitted that the petitioner has obtained licences for selling liquors in retail at certain places, on payment of licence fee under Item 2 of Rule 8(1) of the Rules.

(3.) On behalf of the State Government and the Excise Authorities, no counter affidavit or statement of objections has been filed. However, the learned Government Advocate sought to justify the validity of Clause(d) of S.23 of the Act and sub-rule(1) of Rule 8 of the Rules. He put forth an alternative contention that even if licence fee under Rule 8 (1) of the Rules should be held to be not an excise duty, the levy of such licence fee could be justified as a tax on luxuries.