IDR Act Represents Union's Intention To Exclusively Occupy The Field Of Industrial Alcohol : SG Tells Supreme Court [DAY 5]

The Supreme Court's 9-judge Constitution bench on Tuesday (April 16) resumed its 5th day of hearing the issue of interpretation of 'Intoxicating Liquor'. The underlying issue is whether 'intoxicating liquor' over which the States have power, includes 'industrial alcohol'. The Solicitor General (SG) Mr Tushar Mehta contended that the the Industries (Development and Regulation) Act, 1951(IDR Act) occupied the complete field of the alcohol industry. In contending so, he placed reliance on the test of repugnancy, stressing that when a Parliamentary Legislation holistically covers all aspects of a subject matter, it established the intention of the Union to occupy the complete field.The SG submitted that since various provisions of the IDR Act establish that it was the Parliament's intention to occupy the complete field of alcohol including industrial alcohol in all three stages - pre-production, production and post-production, any state legislation on the same subject would become repugnant and void. The CJI recalled his decision in Forum for People's Collective Efforts (FPCE) vs. State of West Bengal, where the court had rejected the argument that the state in the absence of an express prohibition could make a law identical to an existing central law. The CJI noted that only because S.18G provides that the central government may regulate through a notified order and that there is an absence of such notified order, such an argument alone does not negate other factors showing Parliament's intent to occupy the complete field. “ We overruled it and set aside the State Law, we said that once the Central Law - RERA has held the field, the state cannot enact a law even on all fours of the Central law. So repugnancy in the sense, that they both cannot stand together in one aspect of repugnancy….with respect to S.18G, it says that the government by notified order provide XYZ. Now the issuance of a notified order is an administrative act. This cannot be determinative of the field which is occupied by the Parliament.” S.18 G of the IDR Act provides that the Union may by notification regulate post-production processes (supply, distribution, trade, commerce) of the alcohol industry. 18G. Power to control supply, distribution, price, etc., of certain articles - (1) The Central Government, so far as it appears to it to be necessary or expedient for securing the equitable distribution and availability at fair prices of any article or class of articles relatable to any scheduled industry, may, notwithstanding anything contained in any other provisions of this Act, by notified order, provide for regulating the supply and distribution thereof and trade and commerce therein.'Should The Correctness of 'Tika Ramji Be Looked Into? The Bench Mulls During the hearings, a key contention was raised by SG on the incorrectness of the decision in Tika Ramji. It was the case of the Union to interpret 'industry' as incorporate of all 3 processes - (1) pre-production (including raw materials); (2) production/manufacturing and (3) post production which includes sale, trade, commerce, distribution etc. In Tikaramji, there existed a clash of law-making powers over the subject matter. The question over the validity of the 1953 UP Sugarcane (Regulation of Supply and Purchase) Act, which serves as the basis for the 1954 UP Sugarcane Supply and Purchase Order, was brought to the fore. The critiques of the act's legitimacy hinged on the viewpoint that it encompasses the 'industry' field, an area the Union is considered to occupy in oversight for the want of public interest, under the Parliament's directive in Entry 52 of List I ( Industries controlled by the Union in Public Interest). In response, the Industries (Development and Regulation) Act was enacted by Parliament in 1951. This legislation underscored the Union's crucial role in regulating specific industries for the common good, enumerating these industries in the First Schedule, which includes those that deal with the manufacturing or production of sugar.The Court interpreted that the concept of "industry" includes three primary elements: essential raw materials for industrial activities, the actual process of manufacturing or production, and the distribution process of the end products. It was explained that issues pertaining to the manufacturing process are covered by Entry 24 of List II (Industries subject to the provisions of [entries 7 and 52] of List I). Unless the industry is under the jurisdiction of the central government, at which point, it is governed by Entry 52 of List I.Contrary to the argument that Entry 52 of List I mentions of "industries" is wide-ranging enough to encompass laws regarding raw materials or the distribution of industrial goods, the Court clarified that such components do not fall within Entry 52 of List I domain. However, the CJI, considering the long-standing law laid down in Tika Ramji on the definition of 'industry', pondered whether it is essential for ...

IDR Act Represents Union's Intention To Exclusively Occupy The Field Of Industrial Alcohol : SG Tells Supreme Court [DAY 5]

Anmol Kaur Bawa

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