MODI INDUSTRIES LIMITED Vs. LT GOVERNOR OF DELHI

JUDGEMENT

(1.) By public notice dated 2nd March 1978 the Commissioner of Excise, Delhi, invited applications from only the working distilleries for the grant of licences in Forms CLW1 and L-9, for running the bonded wharehouses in Delhi for supply of ordinary spiced country liquor during the period from 1.4.1978 to 31.3.1979. The terms and conditions for grant of licences, inter-alia, were that the licencee shall be bound to observe Delhi Country Liquor Bonded Warehouses Rules 1976, as amended from time to time (for short 'the Rules') the Punjab Excise Act, 1914 (I of 1914) as enforced in the Union Territory of Delhi (forhort "the Act' and other rules and) regulations framed under the Act and instructions issued by the Excise Commissioner, Delhi, from time to time. The terms also provided that the licencee shall be allowed to import country liquor into Delhi only on execution of a bond for payment of the excise duty on the consignment.

(2.) M/s.Modi Industries Ltd (Petitioner in C.W.No. 1189/80) and M/s. Co-operative Company Limited (Petitioner in C.W. 1634/80) filed applications for grant of the licences. By letter of the Collector of Delhi dated 29th March 1978 the petitioners were informed that the Lt. Governor of Delhi had accepted their tenders subject to petitioners executing bonds as required under Section 16 of the Act and on complying with other formalities by the petitioners in terms of the letter of acceptance of tender. The petitioners executed the necessary bonds and completed the other formalities and thus the requisite licences were issued.

(3.) During the licence period certain quantity of consignment of country liquor imported into Delhi by the petitioners was not issued from the licenced bonded warehouses as the said quantity was found in leaked and broken bottles. There is no dispute about the quantity of such consignment of country liquor which was not issued from the bonded warehouse on account of it having been contained in leaked and broken bottles. The only dispute is whether excise duty is payable or not on such quantity of liquor which was not issued from the bonded warehouses but was part of consignment of country liquor imported into Delhi.