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has evinced to exclude the State Legislature from making a law on a similar subject by virtue of an Entry in List III? 16.4 In order to answer this question, the provisions of the Act made by the Parliament have to be examined threadbare in order to ascertain a clear intention of the Parliament to occupy the field so as to negate the Legislature of the States to have the competence to make a similar law. Thus, while a direct conflict of a Parliamentary law and a State law could be resolved on the touchstone of a harmonious interpretation of the two laws (vide second part of article 254(1)), a potential conflict between a Parliamentary law which has been enacted and a potential or future law by a State Legislature is avoided on the touchstone of the doctrine of occupied field. 16.5 While applying the occupied field doctrine, Courts must delicately balance the legislative competence of the Parliament and the State Legislatures in making laws on a particular subject under the Concurrent List and apply the doctrine of occupied field only having regard to the intention of the Parliament to occupy the field and the Parliament defining the contours of the field sought to be occupied by a comparative and coherent reading of the other Entries in List I and List II, having bearing on the concerned Entry in List III of the Constitution. Such balancing need to be done by Courts in order to ascertain whether despite legislative competence being provided to the State Legislatures under a particular Entry in the Concurrent List but owing to what has been stated in any law made under Entry in List I (Union List) having a bearing on an Entry in the Concurrent List being made subject to any Entry in the Union List, would result in the State Legislatures being denuded of legislative competence to make laws on a similar subject under an Entry in List III such as Entry 33(a) – List III which is under consideration. 16.6 The application of the doctrine of occupied field is a technique adopted by the constitutional courts in order to ensure that there is no potential conflict that could arise between the State laws and the existing Parliamentary law having regard to the nature of the legislative powers, their importance in the socio-economic sphere of governance in the country and such other considerations.

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16.7 Applying the aforesaid principles to the cases at hand, the question is whether by virtue of insertion of Section 18G to the IDRA, the legislative competence of the State Legislatures under Entry 33(a) – List III vis-à-vis products of the scheduled industry namely, “Fermentation Industries” would be governed within the scope and ambit of Section 18G of the IDRA and consequently, the State Legislatures would have no competence to make a law in regard to the products of a scheduled industry in respect of which Section 18G applies. This is by bearing in mind the twin tests referred to above namely, the intention of the Parliament to occupy the field and the demarcation of the areas in which the field is sought to be occupied. In other words, in the instant case, whether Item 26 which speaks of “Fermentation Industries” to include “industrial alcohol” or non-potable alcohol as a product of such industry which has been taken control of by the Union under the provisions of IDRA (and which is excluded from the scope and ambit of Entry 8 – List II), falls within the scope and ambit of a scheduled industry, and thereby Section 18G would apply the aspects referred to above. 16.8 The answer is in the affirmative for the following reasons: firstly, insofar as the potable or “intoxicating liquors” is concerned, the legislative field is exclusively with the State Legislature. However, in respect of the scheduled industry which is “Fermentation Industries” (which does not take within its scope and ambit potable alcohol) vide Item 26 of the First Schedule, all other types of alcohol including “industrial alcohol” can be regulated only by the Parliamentary law and the Central Government. Any other interpretation would imply that even in the face of Section 18G being incorporated into the IDRA and in the absence of any notified order being issued, the States Legislatures and the State Governments would have the legislative competence to make laws on what is the subject matter of Section 18G of IDRA under Entry 33(a) – List III. Then, each State could make its own law on the said subject matter covered under Section 18G of IDRA pertaining to a scheduled industry. If in respect of the products of a scheduled industry, the States make laws and there are a variety of laws made by the individual States which are in force in respect of the subject under Section 18G of IDRA then when a notified order

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is issued, the Central Government’s notified order would apply if there is a direct conflict between the State laws or legal regime in place and the notified order that is issued. This would result in a legal quagmire vis-à-vis a scheduled industry. It cannot then be said that it is necessary to ascertain whether there is a direct conflict between the State law and the notified order made by the Central Government at every instance such an order is issued and if there is such a direct conflict then, the Parliamentary law would apply on the strength of Article 254 of the Constitution. Such a legal confusion and conundrum would not be conducive to a scheduled industry such as “Fermentation Industries” dealing with “industrial alcohol” which is a commodity of critical and significant importance in the Indian economy. 16.9 Sub-section (4) of Section 18G also states that no order in exercise of power conferred by the Section shall be called in question in any court. Thus, the question of repugnancy between an existing State law and the notified order of the Central Government cannot be raised before a court of law. Then, whether both the State law as well as the notified order can be simultaneously obeyed. If not, what would be the remedy. Sub-section (4) of Section 18G also indicates that the Parliament has intended to occupy the field as demarcated under Section 18G. Such an interpretation has to be given in order to avoid a legal uncertainty and quandary in the economy in the context of Section 18G of the IDRA. 16.10 Thus, the question, whether, under Entry 33(a) – List III, the States have been denuded of their powers by virtue of insertion of Section 18G to the IDRA, i.e., Section 18G having occupied the field to the extent of control as above mentioned and the States would not have the competence to pass any law relating to Entry 33(a) – List III, in my view, has to be answered in the affirmative. This is because Section 18G has been inserted by Parliament to the IDRA which is an enactment made pursuant to Entry 52 – List I. Entry 52 – List I speaks of the Union by declaration made by Parliament by law taking control of such scheduled industry (Section 2 of the IDRA) such as the “Fermentation Industries” herein. The industries which are controlled of by the Union are specified in the First Schedule to the IDRA. “Fermentation Industries” is a scheduled industry. Therefore, the Union has taken control

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of “Fermentation Industries”. For the sake of clarification, in the year 2016 an amendment was made to expressly exclude potable alcohol from “Fermentation Industries” and it includes only non-potable alcohol such as “industrial alcohol”. The detailed discussion made above is in regard to only “industrial alcohol” being non-potable alcohol. “Intoxicating liquors” being potable alcohol is not within the scheduled industry. Therefore, the said products of “Fermentation Industries” which have been taken control of by the Union by virtue of insertion of the Section 18G of the IDRA would come within the scope and ambit of the said Section. 16.11 In this context, by way of analogy, it would be of relevance to refer to my dissenting opinion dated 25.07.2024 in Mineral Area Development Authority Etc. vs. M/s. Steel Authority of India & Others (Civil Appeal Nos.4056-4064 of 1999) (“Mineral Area Development Authority”) wherein the interpretation of Entry 50 – List II vis-à-vis Entry 54 – List I came up for consideration and it was observed by me that even a taxation Entry i.e. Entry 50 – List II was subject to the limitation imposed by Parliament by law relating to mineral development in terms of the Entry 54 – List I. Thus, the doctrine of parliamentary supremacy in the context of an Entry in List II (State List) with an Entry in List I (Union List) was considered. For immediate reference the following passage from said opinion could be extracted: “8.6 However, what is pertinent to be considered in this case is, Entry 50 - List II in juxtaposition with Entry 54 - List I. As already noted, Entry 50 - List II is a taxation Entry which empowers a State Legislature to impose tax on mineral rights. However, this power of the State Government is not an absolute power inasmuch as Entry 50 - List II itself states that the power of the State Legislature to impose tax on mineral right is “subject to any limitations imposed by Parliament by law relating to mineral development”. In other words, if there is any limitation imposed by the Parliament by law relating to mineral development then that would have an impact on the legislative competence of the State Legislature to impose a tax on mineral

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rights. The key expressions of Entry 50 - List II are “taxes on mineral rights” and “subject to any limitations imposed by the Parliament by any law on mineral development”. Thus, the Parliament can impose any limitation on the State’s right to impose a tax on mineral rights by way of a law relating to mineral development. Thus, while Entry 50 - List II speaks of taxes on mineral rights and is a taxation Entry empowering States to impose taxes on mineral rights, the same is not unbridled or absolute but is subject to any limitation to be imposed by Parliament by law relating to mineral development. In other words, if Parliament intends to regulate mineral development in the country, it can do so by a law made as per Entry 54 - List I and to that extent the taxation Entry in Entry 50 - List II could be limited and the State’s right to impose a tax on mineral rights by a law would be affected. Thus, a taxation Entry in Entry 50 - List II can be affected by Entry 54 - List I in the interest of mineral development by Parliament imposing a limitation on the State’s right to tax mineral rights. In other words, if the Union has by a law taken control of, inter alia, mineral development with the Parliament passing a law, then the State’s power to impose any tax on mineral rights would, to that extent, be denuded, if the Parliamentary or Central law creates a limitation to impose such a tax, if it relates to mineral development. It is in the above backdrop that the controversy must be considered. 8.7 Exercise of mineral rights have to be consistent with mineral development in the country, which would embrace, inter alia, uniformity in mineral development throughout the country having regard to several factors which would otherwise come in the way of such development. Hence, the framers of the Constitution introduced Entry 50 - List I enabling a limitation being imposed on Entry 50 - List II although that is a taxation Entry giving powers to the States to impose taxes on mineral rights. It is subject to

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any limitation imposed by Parliament under Entry 54 - List I. 8.8 The golden thread which runs through Entry 54 - List I and Entry 23 - List II is that the Entries deal with regulation of mines and mineral development. Thus, any aspect of regulation of mines and mineral development taken under the control of the Union by a declaration made by the Parliament by a law, denudes the State Legislature of its legislative competence to pass any law to that extent. If a Parliamentary law such as MMDR Act, 1957 is enacted and deals with certain aspects of mineral development, to that extent the State Legislature would be denuded of its competence to pass any law on the said aspect. The legislative competence vested with the State Legislature is, therefore, not an absolute one but is subject to a Parliamentary law enacted as per Entry 54 - List I dealing with mineral development. In the circumstance, the aforesaid observations made in Synthetics and Chemicals (7J) are in consonance with the constitutional framework of Article 246 read with the Entries in Lists I and III and the doctrine of occupied field applies in the context of Section 18G of IDRA enacted under Entry 52 – List I and Entry 33(a) – List III.

17. One of the contentions raised was that so long as the notified order has not been issued by the Central Government which triggers the exercise of powers under Section 18G of the IDRA, the States would have the legislative competence to pass laws under Entry 33(a) – List III. In my view, the issuance of a notified order under Section 18G is only a ministerial act to be performed and to be complied with by the Central Government by a publication in the official gazette. The object of publication of a notified order in the official gazette is to inform the world at large about the contents of the said order. This could happen at any point of time having regard to the situations and conditions which emerge in the Indian economy with regard to a product of a scheduled industry which is also described as an article or class of articles relatable to any scheduled industry under Section 18G of IDRA. Thus, when the field is occupied by Section 18G of the IDRA which is an enactment made pursuant to Entry 52 – List I and the State Legislatures are

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denuded of legislative competence for passing any law under Entry 33(a) – List III in respect of a product of a scheduled industry which is read within the definition of article or class of articles relatable to any scheduled industry as per the Explanation to Section 18G, the issuance of a notified order pales into insignificance in the context of repugnancy. The issuance of a notified order has relevance only for the purpose of intimation of action being taken on any particular article or class of article of a scheduled industry by the Central Government in an occupied field. 17.1 As far as the controversy whether “Fermentation Industries” being under the control of the Union could enable the State Legislature to pass a law by virtue of Entry 33 (a) - List III of the Constitution, in the context of a product of “Fermentation Industries” and in the context of Section 18G of the IDRA, there has been a cleavage of opinion of this Court in the aforesaid judgments. While in Synthetics and Chemicals (7J), it was held that mere insertion of Section 18G into the statute of the IDRA, would imply that the field has been occupied by the Union and, therefore, the State has no jurisdiction to exercise its powers under the said Entry and therefore, has been denuded of all its powers, the subsequent decisions in Bihar Distillery etc., have opined that the said position may not be correct. In other words, unless action is taken under Section 18G of the IDRA by the actual issuance of a notified order and if such a notified order is repugnant to an existing State legislation or action being initiated thereto, the question of repugnancy would arise. The judgment of this Court in Tika Ramji has been referred to and how far the said judgment would have an application in the present controversy is a matter to be analysed. 17.2 In Tika Ramji, the vires of the Uttar Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1953 (hereinafter referred to as “UP Act”) was assailed by the petitioners therein. It was contented that the State of Uttar Pradesh had no power to enact the said Act as the same was with respect to the subject of industries, the control of which by the Union was declared by Parliament by law to be expedient in the public interest within the meaning of Entry 52 – List I and was, therefore, within the exclusive province of Parliament. It was further contended that the Act was ultra vires the powers of the State Legislature and

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was a colorable exercise of legislative power by the State. It was further contended that it was repugnant to the IDRA and the Essential Commodities Act, 1955 (Act 10 of 1955) also a Central Act. That in the event of this Court were to hold that the impugned Act was within the legislative competence of the State Legislature, it was void by reason of such repugnancy. It was also contended that the impugned Act stood repealed to the extent that it had been repealed by Section 16 of Act 10 of 1955 and by clause (7) of the Sugarcane (Control) Order, 1955, made in exercise of the powers conferred by Section 3 of Act 10 of 1955 (a Central Act). 17.3 It was observed that even if it was assumed that sugarcane was an article or class of articles relatable to the sugar industry within the meaning of Section 18G of the IDRA, since no order was issued by the Central Government in exercise of the powers vested in it under that section, no question of repugnancy could ever arise because repugnancy must exist in fact and not depend merely on a possibility. The possibility of an order under Section 18G being issued by the Central Government would not be enough. The existence of such an order would be an essential prerequisite before any repugnancy could ever arise. 17.4 Without going into the other aspects of the case, in my view, this Court was not right in holding that since no order was issued by the Central Government under Section 18G of the IDRA, the legislative field was open to both the Central as well as the State Governments to take action. That portion of the judgment in Tika Ramji in my view is not correct. 17.5 The judgments of this Court including that of the Constitution Bench in Tika Ramji; Indian Aluminium company Limited vs. Karnataka Electricity Board (1992) 3 SCC 580 (“Indian Aluminium company”); Shree Krishna Gyanoday Sugar Ltd.; Belsund Sugar Co. Ltd. vs. State of Bihar (1999) 9 SCC 620 (“Belsund Sugar Co. Ltd.”) and SIEL Ltd. vs. Union of India (1998) 7 SCC 26 (“SIEL Ltd.”) have lost sight of the fact that when a notified order is issued under Section 18G of the IDRA it is pursuant to a Central enactment made by virtue of Entry 52 – List I and it is not an exercise of power under Entry 33(a) – List III. When once Section 18G has been

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inserted to the IDRA in respect of a scheduled industry, the control being taken over by the Union in respect of the very same scheduled industry, legislative competence cannot remain with the State Legislature also under Entry 33(a) – List III in respect of the aspects or field covered under Section 18G of IDRA which is a Parliamentary enactment.

18. There is another angle to the matter. Article 254 in the normal course would apply when there is a direct conflict between the laws made by the Parliament and the State Legislature under an Entry in the Concurrent List. But in the instant case, it can also be held that the conflict is not between a law or an action taken by the Parliament or the Central Government under Entry 33(a) – List III versus a State law that could be made or action taken under the very same Entry. Here, the conflict arises between action that could be taken by the Central Government under Section 18G of IDRA made by virtue of Entry 52 – List I as opposed to a State law or action which could be made under Entry 33(a) – List III. In such case, the doctrine of repugnancy would arise as per the first part of Article 254(1) between Entry 52 – List I and Entry 33(a) – List III and not in respect of the second part of Article 254(1). Thus, when the Central Government seeks to exercise power in respect of a scheduled industry under Section 18G of the IDRA it is pursuant to the said Act being made under Entry 52 – List I. Hence, any action to be taken by the Central Government under Section 18G is not really an action that would be taken under Entry 33(a) – List III. 18.1 On this aspect, reference must be made to judgment of this Court in State of Kerala vs. Mar Appraem Kuri Company Limited (2012) 7 SCC 106 (“Mar Appraem Kuri Company”). The Constitution Bench of this Court speaking through Kapadia, C.J., considered the question - when does repugnancy arise in the context of whether Kerala Chitties Act 23 of 1975 becoming repugnant to the (Central) Chit Funds Act 40 of 1982 under Article 254(1) upon making of the Central Act (i.e. 19.08.1982 when the President gave his assent) or whether the Kerala Chitties Act 23 of 1975 would become repugnant to the Central Act as and when the notification under Section 1(3) of the Central Act bringing the Central Act into force in the State of Kerala is issued. In other words, the question raised was whether making of the law or its commencement brings about repugnancy or inconsistency as envisaged in Article 254(1) of

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the Constitution. In this context, reference was made to Deep Chand vs. State of UP, AIR 1959 SC 648 (“Deep Chand”) and it was observed as under: “30. That, in Deep Chand v. State of U.P., three principles were laid down as indicative of repugnancy between a State law and a Central law, which have to be borne in mind by the State Legislature whenever it seeks to enact a law under any entry in the Concurrent List. Thus, where there is a Central law which intends to override a State law or where there is a Central law intending to occupy the field hitherto occupied by the State law or where the Central law collides with the State law in actual terms, then the State Legislature would have to take into account the possibility of repugnancy within the meaning of Article 254 of the Constitution. In this connection, it was submitted that Tests 1 and 2 enumerated in Deep Chand do not require the Central law to be actually brought into force for repugnancy between two competing legislations to arise in the context of Article 254 of the Constitution.” 18.2 In paragraph 40, it was observed that the expression “subject to” in clauses (2) and (3) of Article 246 denotes supremacy of Parliament and the same is extracted as under: “40. However, the principle of federal supremacy in Article 246(1) cannot be resorted to unless there is an “irreconcilable” conflict between the entries in the Union and State Lists. The said conflict has to be a “real” conflict. The non obstante clause in Article 246(1) operates only if reconciliation is impossible. As stated, the parliamentary legislation has supremacy as provided in Articles 246(1) and (2). This is of relevance when the field of legislation is in the Concurrent List. The Union and the State Legislatures have concurrent power with respect to the subjects enumerated in List III. [See Article 246(2).] Hence, the State Legislature has full power to legislate regarding subjects in the Concurrent List, subject to Article 254(2) i.e. provided the provisions of the State Act do not come in conflict with those of the Central Act on the subject. [See Amalgamated Electricity Co.

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(Belgaum) Ltd. v. Municipal Committee, Ajmer [AIR 1969 SC 227 : (1969) 1 SCR 430 ]. Thus, the expression “subject to” in clauses (2) and (3) of Article 246 denotes supremacy of Parliament.” 18.3 In paragraph 43, it was observed as under: “43. Our Constitution gives supremacy to Parliament in the matter of making of the laws or legislating with respect to matters delineated in the three Lists. The principle of supremacy of Parliament, the distribution of legislative powers, the principle of exhaustive enumeration of matters in the three Lists are all to be seen in the context of making of laws and not in the context of commencement of the laws.” 18.4 Dealing with the question of repugnancy and the ways in which it would arise between Parliamentary legislation and States’ legislation, it was observed in paragraph 47 as under: “47. The question of repugnancy between parliamentary legislation and State legislation arises in two ways. First, where the legislations, though enacted with respect to matters in their allotted spheres, overlap and conflict. Second, where the two legislations are with respect to matters in the Concurrent List and there is a conflict. In both the situations, the parliamentary legislation will predominate, in the first, by virtue of non obstante clause in Article 246(1); in the second, by reason of Article 254(1).” 18.5 Ultimately, in paragraph 61, it was stated as under: “61. The entire above discussion on Articles 245, 246, 250, 251 is only to indicate that the word “made” has to be read in the context of the law-making process and, if so read, it is clear that to test repugnancy one has to go by the making of law and not by its commencement.” 18.6 On the facts of the said case, this Court held that on the enactment of the (Central) Chit Funds Act, 1982 on 19.08.1982, intending to occupy the entire field of chits under Entry 7 - List III, the State Legislature was denuded of its power to enact the Kerala Finance Act 7 of 2002.

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18.7 Thus, when the State of Kerala intended to amend the State Act in 2002, it was bound to keep in mind the fact that there is already a Central law on the same subject made by Parliament in 1982, though not in force in Kerala, whereunder there is a pro tanto repeal of the State Act. Therefore, the State Legislature ought to have followed the procedure in Article 254(2) and ought to have obtained the assent of the President. 18.8 Ultimately, in paragraph 78, issue was summed up as under: “78. To sum up, Articles 246(1), (2) and 254(1) provide that to the extent to which a State law is in conflict with or repugnant to the Central law, which Parliament is competent to make, the Central law shall prevail and the State law shall be void to the extent of its repugnancy. This general rule of repugnancy is subject to Article 254(2) which inter alia provides that if a law made by a State Legislature in respect of matters in the Concurrent List is reserved for consideration by the President and receives his/her assent, then the State law shall prevail in that State over an existing law or a law made by Parliament, notwithstanding its repugnancy.”

19. Further, reference could also be made to the Food Safety and Standards Act, 2006 (“FSSA, 2006”) which has been enacted pursuant to Entry 52 – List I where the Parliament by a declaration made under Section 2 of the said Act has declared that it is expedient in the public interest that the Union should take under its control the food industry. Consequently, clause (b) of Entry 33 – List III which speaks of food stuffs, including edible oils seeds, and oils would be impacted on account of the FSSA, 2006 and the declaration made therein pursuant to Entry 52 – List I to the extent of the control under the said Act.

20. The reason for the aforesaid view would have to be also considered from the point of view of the fact that when an “industry” is taken control of by the Union by specifying it in the First Schedule of the IDRA, it becomes a scheduled industry and to the extent of control envisaged as per the Schedule and as per the provisions of IDRA. It is only those industries which are critical and of vital significance to the Indian economy which are taken control of by the Union and one such industry is “Fermentation Industries”, which inter alia comprises

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of “industrial alcohol” both as a product and as a raw material for other industries.

21. Conversely, if any industry is not a scheduled industry and does not come within the scope and ambit of First Schedule of the IDRA, in such an event, not only Entry 24 - List II but also Entries 26 and 27 - List II would fully operate. Then, Entries 26 and 27 - List II would not be subject to the restriction under Entry 33(a) - List III nor to Entry 52 - List I. The States would have the liberty to pass laws with regard to trade and commerce, production supply and distribution of goods of any industry under Entries 26 and/or 27 - List II without there being any restriction in terms of Entry 33(a) - List III. In other words, insofar as a non-scheduled industry is concerned, Entry 33(a) - List III would not at all apply and Entries 26 and/or 27 - List II would apply in the matter of production, supply and distribution of goods or trade and commerce of the products of any industry or any other specific Entry in List II, as the case may be.

22. In the above context, the intention of the Constitution makers in the matter of division of legislative subjects between the Parliament and the States have to be clearly understood. In order to achieve consistency of dividing the subjects of legislation not only within the particular Lists, namely, the Union List, State List and Concurrent List but also, inter se, between the three Lists so as to have a clarity in the matter of the Parliament or the State Legislature having competence to make laws, the prescription under Article 246 and the mandate thereof would give a clue regarding interpretation of the Entries in the three Lists. To reiterate, Articles 246 (1) and (2) of the Constitution begins with a non-obstante clause and Article 24(3) begins with a “subject to” clause. On a conspectus reading of aforesaid clauses of Article 246, it is evident that the Legislature of a State has the power to make laws with respect to any matter enumerated in List III, i.e., Concurrent List, subject to List I which deals with Parliament’s exclusive powers to make laws in respect of any matter enumerated in List I. Therefore, a subject placed in List III, i.e., the Concurrent List can also be subject to the exclusive power of Parliament to make laws with respect to any matter enumerated in List I (vide first part of Article 254(1)). Thus, the intention of the Constitution makers was to preserve parliamentary supremacy while at the same time maintaining a federal balance in the matter of distribution of the fields of legislation vis-à-vis various Entries in the three Lists. This is also evident on a reading of Article 246(3) which deals with the

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exclusive powers to make laws by State Legislatures in respect of matters enumerated in List II being subject to clauses (1) and (2) of Article 246, i.e., subject to the Union List and the Concurrent List is in a case of conflict of laws which is irreconcilable.

23. Any other view would result in a situation wherein the State Legislatures on the strength of Entry 33(a) – List III would have their own legislations on the premise that there is no notified order issued by the Central Government in respect of the scheduled industry under Section 18G of the IDRA, and if subsequently in respect of a product of a scheduled industry, the Central Government is to issue a notification under Section 18G of the IDRA, the laws that are in operation in the various States would become repugnant if there is a direct conflict between the said State laws with the notified order issued by the Central Government under Section 18G of the IDRA. This would result in a legal quagmire and uncertainty leading to confusion. Therefore, for this reason also States cannot have legislative competence to pass laws or take any action in respect of any product of a scheduled industry from the moment Section 18G has been inserted to the IDRA which has been enacted pursuant to Entry 52 – List I. As a result, time of insertion of Section 18G to the IDRA, the intention of the Union is to occupy the field insofar as an article or articles of scheduled industry is concerned which will also include a product of a scheduled industry. Consequently, the States are denuded of their powers to pass any law insofar as the said subject-matter is concerned.

24. In State of W.B. vs. Union of India, AIR 1963 SC 1241 (“State of W.B.”), this Court on a comparative analysis of List I in Seventh Schedule to the Constitution with the Seventh Schedule to the 1935 Act noted that the powers of the Union have been enlarged particularly in the field of economic unity and that this was done as it was felt that there should be centralised control and administration in certain fields of common interest if rapid economic and industrial progress had to be achieved by the nation. Reference in this regard was also made, inter alia, to the transfer of new Entry 33 – List III in the Constitution from List II of the 1935 Act. It was observed that the result of ensuring such economic unity was a departure from any traditional pattern of federation and a conscious decision for the common good. Furthermore, in identifying deviations from traditional features of federations, this Court noted a notable feature that is true of the Indian constitutional framework:

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“26. … (c) Distribution of powers between the Union and the regional units each in its sphere coordinate and independent of the other. The basis of such distribution of power is that in matters of national importance in which a uniform policy is desirable in the interest of the units, authority is entrusted to the Union, and matters of local concern remain with the States. …”

Importance of “Industrial Alcohol” to the Indian Economy:

25. It is necessary to note the importance of “industrial alcohol” in the Indian economy. “Industrial alcohol” is important to the Indian economy for it is used in at least two sectors: i) as a key feedstock for production of various chemicals in the chemicals industry; and ii) as liquid fuel to be blended with petrol. 25.1 As regards the chemical industry, the XIIth five-year plan (2012- 2017) of the Planning Commission (“PC Report”) notes that “alcohol-based chemical industry occupies an important place in the Indian chemical industry and is a key contributor to the growth of the sector”. It also notes that several alcohol-based chemicals are made using “industrial alcohol” and are used as building blocks for various downstream industries such as “synthetic fibres and synthetic yarn, drugs and pharmaceuticals, agrochemicals, personal care products, dyestuffs, pigments, flavours & fragrances etc.” Further, the PC Report notes that alcohol based chemical industry “contributes to green chemistry” as chemicals are manufactured using ethanol instead of being manufactured through the petro-chemical route. It also notes that they contribute to foreign exchange reserves. 25.2 As regards blending of ethanol with petrol, the contribution of Ethanol Blended with Petrol (EBP) programme of the Government of India appears significant. In this programme, fuel-grade ethanol is blended with petrol and is sold by Oil Marketing Companies (OMCs) for use as a fuel in automobiles. In response to an Unstarred Question No.2764 answered on 20th December, 2023, the Minister of State for Ministry of Consumer Affairs, Food & Public Distribution had answered that: i) The Government of India has been implementing EBP programme and has fixed the target of 20% blending of ethanol with petrol by 2025;

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ii) The supply of ethanol to OMCs has increased by more than 13 times from 38 crore litres in ESY 2013-13 to 502 crore litres in ESY 2022-23; iii) To achieve the target of 20% blending by 2025, about 1016 crore litres of ethanol would be required and for this, about 1700 crore litres of ethanol producing capacity is required. 25.3 Further, a report of the Ministry of Petroleum and Natural Gas, Government of India titled “Ethanol Growth Story” suggests that the EBP programme has at least three benefits: first, it raises income of farmers which is evident from the observation that OMCs have paid sugar mills nearly Rs.81,796 crore for ethanol supplies up to 2022. Second, it reduces import bills and improves India’s energy security. The report suggests that the cumulative foreign exchange impact is estimated to be over Rs.53,894 crore between 2014 and 2022. Third, it lowers CO2 emissions and promotes a cleaner environment. The report estimates that Greenhouse gas emissions were reduced by 318.2 lac tonnes due to the EBP programme between 2014 and 2022.

26. Thus, insofar as “Fermentation Industries” (other than potable alcohol) is concerned, both alcohol and other products of “Fermentation Industries” being a scheduled industry under the IDRA passed under Entry 52 – List I it would clearly be within the scope of Union legislation. It is clarified that as far as the concept of “intoxicating liquors” versus “industrial alcohol” is concerned, it is clear that Entry 33(a) – List III does not deal with “intoxicating liquors” which is a State subject under Entry 8 – List II. “Fermentation Industries” is a controlled industry and is a scheduled industry under the IDRA. It has been clarified by the 2016 Amendment that Item 26 dealing with “Fermentation Industries” does not include potable alcohol. Therefore, insofar as “intoxicating liquors” which is “potable liquors” is concerned, only the State Legislatures have the legal competence to enact laws concerning the said subject. Therefore, other types of liquor (i.e. excluding “intoxicating liquors”) comes within the nomenclature of “Fermentation Industries” which is a scheduled industry under IDRA.

27. Since qua State Legislatures, Article 246(2) is also subject to Article 246(1), the legislation which could have been made under List III (Concurrent List) can also be subject to legislation made under Entry 52 – List I. This is expressly so having regard to Entry 33(a) – List

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III as any law regarding trade and commerce in, and the production, supply and distribution of the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as such products, would be subject to a law made as per Entry 52 – List I i.e., IDRA. This is because a Parliamentary law which is made by virtue of an Entry under List I has supremacy over any other law in List II or List III when they are irreconcilable or when the doctrine of occupied field applies respectively.

28. In Mineral Area Development Authority, I have voiced similar concerns as in the present case in the following words: “36.3 The Government of India Act, 1935 was the first comprehensive blueprint for legislative division of power in India between federal, provincial and concurrent spheres which resolved residuary powers to rest with the Federal Government. Though there are apparent similarities between the Government of India Act, 1935 and the Indian Constitution, yet factors, such as, regulation of economic competition and the development of twentieth century welfare States guided the constitutional blueprint for a model of federalism in which provincial initiative should not preclude national coordination, particularly, in the fields of socio-economic spheres. 36.4 According to Tillin, “in the case of India, political economy considerations intersect with the accommodation of diversity in shaping the resulting forms of federalism”. The question of a desirable balance between Central and the State Governments has to be viewed in the context of the country continuing to confront the need to promote economic growth while upholding and expanding social rights. Sarkaria Commission Report on Centre-State Relations:

37. Resolved to study and reform the existing arrangements between the Union and the States in an evolving socio- economic scenario, the Ministry of Home Affairs vide Order dated 09.06.1983 constituted a Commission under the Chairmanship of Justice R.S. Sarkaria with Shri B. Sivaraman and Dr. S.R. Sen having due regard to the

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framework of the Constitution. At this stage, reference to Section 5, Chapter II – Legislative Relations of the Report of the Sarkaria Commission (“Sarkaria Commission Report”) may be of assistance: “2.5.21 In every Constitutional system having two levels of government with demarcated jurisdiction, contents respecting power are inevitable. A law passed by a State legislature on a matter assigned to it under the Constitution though otherwise valid, may impinge upon the competence of the Union or vice versa. Simultaneous operation side-by-side of two inconsistent laws, each of equal validity, will be an absurdity. The rule of Federal Supremacy is a technique to avoid such absurdity, resolve conflicts and ensure harmony between the Union and State laws. This principle, therefore, is indispensable for the successful functioning of any federal or quasi-federal Constitution. It is indeed the kingpin of the federal; system. “Draw it out, the entire system falls to pieces” 2.5.22 If the principles of Union Supremacy are excluded from Articles 246 and 254, it is not difficult to imagine its deleterious results. There will be every possibility of our two-tier political system being stultified by internecine strife, legal chaos and confusion caused by a host of conflicting laws, much to the bewilderment of the common citizen. Integrated legislative policy and uniformity on basic issues of common Union-State concern will be stymied. The federal principle of unity in diversity will be very much a casualty. The extreme proposal that the power of Parliament to legislate on a Concurrent topic should be subject to the prior concurrence of the States, would, in effect, invert the principle of Union Supremacy and convert it into one of State Supremacy in the Concurrent sphere. The very object of putting

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certain matters in the Concurrent List is to enable the Union Legislature to ensure uniformity in laws on their main aspects throughout the country. The proposal in question will, in effect, frustrate that object. The State Legislatures because of their territorially limited jurisdictions, are inherently incapable of ensuring such uniformity. It is only the Union, whose legislative jurisdiction extends throughout the territory of India, which can perform this pre-eminent role. The argument that the States should have legislative paramountcy over the Union is basically unsound. It involves a negation of the elementary truth that the ‘whole’ is greater than the ‘part’.” (emphasis supplied)

As the paragraphs extracted above elucidate, the Commission was of the firm view that the principles of Union Supremacy cannot be undermined from Articles 246 and 254. While the immediate paragraph is concerned with legislative actions taken under the List III - Concurrent List, they provide us a beneficial lens to both the importance of Union supremacy in matters that demand national uniformity and the Commission’s following discussion on “Mines and Minerals” in Chapter XIII.”

29. Constitutional law is mainly concerned with the basic features or the framework of distribution of powers between the different organs of the State; between the Union and its units and between the State and the citizens. But there is something in a Constitution that is even more primordial than the structure and the features. These are the ideals on which the founding parents, in their wisdom and sagacity, built the entire edifice of the Constitution itself. It is all important that this edifice is not dislodged while attempting to dynamically interpret the Constitution. These Constitutional ideals are irreducible and underpin the survival and success of constitutional order and a concordial society. Federalism is one such ideal where the Constitution defines a federal structure with a unitary spirit in Article 246 read with the three Lists of the Seventh Schedule of the Constitution.

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Conclusions on interplay of legislative Entries:

30. In view of the aforesaid discussion, my conclusions on the interplay of the legislative Entries under consideration are as under: I. The field of legislation comprised in Entry 8 – List II is carved out of Entry 24 – List II. Thus, the subject relating to “intoxicating liquors”, that is to say, the production, manufacture, possession, transport, purchase and sale of “intoxicating liquors” being a specific subject is taken out of the general subject of “industries” under Entry 24 – List II. II. As a result, Entry 52 – List I or any law made under that Entry by the Parliament cannot intrude or trench upon any law made by the State Legislatures under Entry 8 – List II. Thus, the Parliament cannot take under its control the subject pertaining to “intoxicating liquors” under any law, such as, IDRA made under Entry 52 – List I. Therefore, the subject “intoxicating liquors” falls exclusively within the domain of the State Legislatures which also have the obligation to prevent “industrial alcohol” being converted into “intoxicating liquors” as an abuse and, therefore, pass legislations or take State action in that regard having regard to Article 47 of the Constitution of India. III. Entry 33(a) – List III (Concurrent List) and any law made or to be made by the State Legislatures under the said Entry is subject to Parliamentary law made either under Entry 52 – List I or under Entry 33(a) – List III in terms of the first part and second part of Article 254(1) respectively. Thus, if any law has been made by the Parliament by virtue of Entry 52 – List I, such as, the IDRA and there is an intention to occupy the field, the State law would be subject to the doctrine of occupied field. Thus, Section 18G of the IDRA which has been made by virtue of Entry 52 – List I thereof would prevail on the basis of the aforesaid doctrine. Consequently, it is held that issuance of a notified order under Section 18G of the IDRA is neither a sine qua non nor is it a condition precedent for the State Legislatures to restrain exercise of powers under Entry 33(a) – List III. In other words, the mere insertion of Section 18G to the IDRA implies that the Parliament has intended to

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occupy the field demarcated under the aforesaid provision. Also, a notified order when issued by the Central Government under Section 18G of the IDRA cannot be questioned in any Court of law. This also indicates that the doctrine of occupied field applies to the said Section vis-à-vis a scheduled industry under the IDRA. IV. If the Parliament has made a law under Entry 52 – List I and intends to occupy the whole field then the State Legislatures are denuded of their powers and therefore, they would lack legislative competence to enact a law under Entry 33(a) – List III. In the context of “industrial alcohol” and in terms of Item 26 of the First Schedule of the IDRA i.e. “Fermentation Industries”, it is only the Central Government which has the powers to act under Section 18G of the said Act. So long as an industry is a scheduled industry under the IDRA and Section 18G of the said Act remains on the statute book, the State Legislatures are denuded of their powers to pass a legislation or to take any action in respect of the products of a scheduled industry under Entry 33(a) – List III.

Effect of overruling Synthetics and Chemicals (7J):

31. The judgment of this Court in Synthetics and Chemicals (7J) has held the field since 1989 for three and a half decades. The doubts which have arisen regarding the said judgment subsequently have led to the reference to a larger Bench. On re-considering the judgment in Synthetics and Chemicals (7J) in light of the arguments advanced before this nine-Judge bench and in the backdrop of the constitutional Entries in the three Lists, I find that except for a clarification and deletion of the words “both potable and ” in paragraph 84 of AIR version of the Report, the said judgment would not call for any intervention. The reasons for saying so can be stated as under: Firstly, the judgment has held the field for three and a half decades on certain concrete ideas pertaining to liquors as part of “Fermentation Industries”, which is a scheduled industry, and that part which is excluded from the aforesaid scheduled industry. This is based on the interplay of Entries in Lists I and II.

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The judgment in Synthetics and Chemicals (7J) has crystallised the concepts of “intoxicating liquors” and “industrial alcohol” which are clearly distinguished in legislations of the State and in administration or governance for several decades on the basis of constitutional demarcation of legislative entries. Consequently, it held that “Fermentation Industries” is a controlled industry and I have now clarified that it does not take within its ambit “intoxicating liquors” or potable alcohol. The judgment in Synthetics and Chemicals (7J) correctly held on a conspectus reading of Entry 8 – List II, Entry 6 - List II and Article 47 that State Legislatures have the competence to ensure that “industrial alcohol” or non- potable alcohol is not diverted and misused as a substitute for potable alcohol. Secondly, the judgment has correctly considered the significance of insertion of Section 18G to the IDRA which is a Parliamentary Law made under Entry 52 – List I and the consequences that follow in light of the doctrine of occupied field in the context of “Fermentation Industries”, a scheduled industry, by bearing in mind the first part of Article 254(1) of the Constitution. Thirdly, the reasons assigned in Synthetics and Chemicals (7J) for invoking the doctrine of occupied field in the context of “Fermentation Industries” and in the context of Section 18G of the IDRA would equally apply to all other scheduled industries under the said Act. Any interference with the said legal position would have a cascading effect on other scheduled industries thereby giving legislative competence in respect of all scheduled industries to the States under Entry 33(a) – List III. This would result in multiple States as well as the Union having powers to make laws which would lead to the scheduled industries under IDRA pale into insignificance. This would defeat the purpose of Entry 52 – List I and the laws made thereunder; such as IDRA. Fourthly, the critical importance of scheduled industries in the Indian economy must not be lost sight of. The object and purpose of Entry 52 – List I and passing of laws on

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the strength of the said Entry by the Parliament taking over control of certain industries by a declaration made by law as expedient in the public interest, is a factor which cannot be lost sight of while answering the reference made to this Bench in the form of various questions raised. This aspect has been borne in mind in Synthetics and Chemicals (7J) while deciding the issues raised therein. Fifthly, if the judgment in Synthetics and Chemicals (7J) is overruled then all State legislatures can also make laws under Entry 33(a) – List III in respect of scheduled industries. This would result in IDRA made under Entry 52 – List I and Entry 52 – List I itself losing significance as the object and purpose of taking control of certain industries by insertion of the said industries as scheduled industries under the said Act would be defeated. Sixthly, if industries of critical importance to the Indian economy which are scheduled industries under the IDRA which are under the control of the Union by a declaration made by Parliament by law are allowed to be legislated upon by the State legislatures, the whole object of taking control of such industries by the Union for ensuring uniformity in their development and for ensuring the object and purpose of the IDRA would be defeated. This would result in a haphazard development of such scheduled industries in the country. For instance, if “industrial alcohol” is read as coming within the scope and ambit of Entry 8 – List II then it would be excluded from the scheduled industry. Such a state of affairs would not be conducive to the economy as the scheduled industries such as “Fermentation Industries”, minus potable alcohol play a significant role in the Indian economy. Seventhly, the interpretation of the constitutional Entries and the provisions of the Constitution must be so made bearing in mind the intentions of the framers of the Constitution and the nature and structure of the Indian economy and the need for a uniform development throughout the country of certain industries which have been taken control of by the Union. This approach has been adopted in Synthetics and Chemicals (7J).

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Eighthly, the principle of federal balance must yield to the doctrine of Parliamentary supremacy in certain areas such as when laws are made under Entry 52 or Entry 54 or Entry 7 – List I such as in the present cases. This is because of the unique manner in which Article 246 of the Constitution is worded and the division of legislative subjects between the Parliament and the State legislatures, having regard to the unique federal structure in India with the balance tipping in favour of the Union in certain niche areas of legislation and governance. Ninthly, the Amendment Act, 2016 has brought much needed clarity on the issue and is the correct position of law compatible with the scheme of legislative competence as under our Constitution. I have already held that merely because “industrial alcohol” can be easily manufactured into or misused to become “intoxicating liquors” would not grant States the competence to wholly regulate “industrial alcohol”. State legislatures only have legislative competence over what is “intoxicating liquors” as a beverage. Therefore, the judgment in Synthetics and Chemicals (7J) is good law and was most correct in postulating that State legislatures will only have the competence to prevent misuse in interest of public health. For the aforesaid reasons, I am of the view that although the judgment in Synthetics and Chemicals (7J) calls for only a clarification, it does not require any overruling.

My answers to the questions formulated:

32. Consequently, the questions formulated are accordingly answered as under: Ques. 1. Does Section 2 of the Industries (Development and Regulation) Act, 1951, have any impact on the field covered by Section 18G of the said Act or Entry 33(a) of List III of the Seventh Schedule of the Constitution? Ans.: Entry 33(a) – List III has to be read in the context of Entry 52 – List I. IDRA is relatable to Entry 52 – List I. Section 2 of the IDRA has a nexus and is connected with Section 18G of the said Act. Therefore, Entry 33(a) – List III is impacted by Section 2 read with Section 18G of the IDRA.

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Ques. 2. Does Section 18G of the aforesaid Act fall under Entry 52 of List I of the Seventh Schedule of the Constitution, or is it covered by Entry 33(a) of List III thereof? Ans.: Section 18G of the IDRA is directly relatable to Entry 52 – List I which has to be read in the context of Section 2 of IDRA. The doctrine of occupied field applies and the legislative field under Entry 33(a) – List III is covered by the said provision on the basis of doctrine of occupied field under first part of Article 254 of the Constitution. Ques. 3. In the absence of any notified order by the Central Government under Section 18G of the above Act, is the power of the State to legislate in respect of matters enumerated in Entry 33 of List III ousted? Ans.: Yes, even in the absence of any notified order by the Central Government under Section 18G of the IDRA, the power of the States to legislate in respect of matters enumerated in Entry 33(a) – List III is ousted on the basis of the doctrine of occupied field as aforestated. On this aspect, the judgment of this Court in Synthetics and Chemicals (7J) is correct. Ques. Does the mere enactment of Section 18G of the above Act, give rise to a presumption that it was the intention of the Central Government to cover the entire field in respect of Entry 33(a) - List III so as to oust the States’ competence to legislate in respect of matters relating thereto? Ans.: Yes, the mere enactment of section 18G of the IDRA gives rise to a presumption that it was the intention of the Parliament and Central Government to cover the entire field in respect of Entry 33(a) - List III so as to oust the States’ competence to legislate in respect of matters relating thereto. Answer given to question (3) above is reiterated here. Ques. 5. Does the mere presence of Section 18G of the above Act, oust the State’s power to legislate in regard to matters falling under Entry 33(a) of List III? Ans.: Yes, the mere presence of Section 18G of the IDRA would oust the State’s power to legislate in regard to matters falling under Entry 33(a) - List III. The doctrine of occupied field applies.

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Ques. 6. Does the interpretation given in Synthetics and Chemicals case (1990) 1 SCC 109 in respect of Section 18G of the Industries (Development and Regulation) Act, 1951, correctly state the law regarding the States’ power to regulate “industrial alcohol” as a product of the scheduled industry under Entry 33(a) of List III of the Seventh Schedule of the Constitution in view of Clause (a) thereof? Ans.: Yes, the interpretation given in Synthetics and Chemicals case (1990) 1 SCC 109 in respect of Section 18G of the IDRA correctly states the law. Even with regard to “industrial alcohol” as a product which falls within “Fermentation Industries” in respect of which the Union has assumed control, in the absence of a notified order, the competence of the State to act under Entry 33 - List III is denuded.

My answers to the conclusions of learned Chief Justice:

33. His Lordship, the Chief Justice of India has overruled the judgment in Synthetics and Chemicals (7J) and has come to the following conclusions and my answers to the same are in a tabular form as under: Point(s) Conclusions arrived at My Conclusions by Hon’ble the CJI a. Entry 8 of List II of the In my view, Entry 8 – List II deals Seventh Schedule to the with “intoxicating liquors”. The Constitution is both an misuse, diversion or abuse industry-based entry and of “industrial alcohol” as a product-based entry. “intoxicating liquors” can also The words that follow the be controlled and prevented expression “that is to say” in under Entry 8 – List II by the the Entry are not exhaustive State Legislatures having of its contents. It includes regard to Article 47 of the the regulation of everything Constitution. It is also made from the raw materials to the clear that the IDRA which has consumption of ‘intoxicating been enacted by the Parliament liquor’; by virtue of Entry 52 – List I has taken control of “Fermentation Industries” as a scheduled industry. Such “Fermentation Industries” would exclude “intoxicating liquors”.

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b. Parliament cannot occupy Parliament can occupy the the field of the entire field of the entire industry by industry merely by issuing merely issuing a declaration a declaration under Entry under Entry 52 – List I and 52 of List I. The State t h e S t a t e L e g i s l a t u r e ’s Legislature’s competence competence under Entry 24 under Entry 24 of List II is – List II is denuded to the denuded only to the extent field of the entire industry of the field covered by the and specifically to the extent law of Parliament under of the field covered by the Entry 52 of List I; law of Parliament under Entry 52 – List I. c. Parliament does not have I agree. the legislative competence to enact a law taking control of the industry of intoxicating liquor covered by Entry 8 of List II in exercise of the power under Article 246 read with Entry 52 of List I; d. The judgments of the The context of the controversy Bombay High Court in must be borne in mind in the FN Balsara v. State of said cases. The aforesaid Bombay (supra), this decisions in substance Court in FN Balsara limited the meaning of the (su pra) a nd So u th e r n expression “intoxicating Pharmaceuticals (supra) liquors” to its popular meaning did not limit the meaning of i.e. “alcoholic beverages” the expression ‘intoxicating that produce intoxication. liquor’ to its popular Therefore, in the context of meaning, that is, alcoholic prohibition of “intoxicating beverages that produce liquor” as a beverage, intoxication. All the three there could not have been judgments interpreted the prohibition of production of expression to cover alcohol alcohol used for medicinal that could be noxiously and toilet preparation as well used to the detriment of as “industrial alcohol” or non- health; potable alcohol.

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e. The expression ‘intoxicating The expression “intoxicating liquor’ in Entry 8 has not liquor” in Entry 8 has acquired acquired a legislative a legislative and judicial meaning on an application meaning over the decades as of the test laid down in per the discussion above. Ganon Dunkerley (supra); f. The study of the evolution The members of the of the legislative entries Constituent Assembly were on alcohol indicates that clear in what they envisaged the use of the expressions within the scope and ambit of “intoxicating liquor” and the expression “intoxicating “alcoholic liquor for human liquors” in Entry 8 – List II. consumption” in the Seventh This is also evident from Schedule was a matter well- Item 26 of the First Schedule thought of. It also indicates of the IDRA. “Intoxicating that the members of the liquors” is only a segment of Constituent Assembly were the “Fermentation Industries”, aware of use of the variants n a m e l y, p o t a b l e a l c o h o l . of alcohol as a raw material There was no intention on in the production of multiple the part of the members of products; the Constituent Assembly to read within the expression “intoxicating liquors” non-potable or “industrial alcohol”. Further, in order to have a consistency between what was envisaged under Entry 84 – List I and Entry 51 – List II in the context of alcoholic liquors for human consumption, the taxing Entry in List II which is within the legislative competence of the States follows the regulatory Entry in Entry 8 – List II. Therefore, the use of the expression “industrial alcohol” or non-potable alcohol in Synthetics and Chemicals (7J)

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was only to crystallise all variants of alcohol which were non-potable and to distinguish the same from potable alcohol meant only for human consumption as a beverage. g. Entry 8 of List II is based The entire controversy cannot on public interest. It be viewed from the point of view seeks to enhance the of alcohol being used as a raw scope of the entry beyond material and final product such potable alcohol. This is as hand sanitizer containing inferable from the use of alcohol. The potential misuse the phrase ‘intoxicating’ of alcohol cannot be the basis and other accompanying for interpreting an Entry such words in the Entry. Alcohol as Entry 8 – List II. Ultimately, is inherently a noxious the “Fermentation Industries” substance that is prone have to be borne in mind to misuse affecting public which takes within its canvas health at large. Entry 8 only non-potable / “industrial covers alcohol that could alcohol”. The aspect of public be used noxiously to the health having a corelation to detriment of public health. Entry 8 – List II dealing with This includes alcohol “intoxicating liquor” and the such as rectified spirit, misuse of alcohol cannot be ENA and denatured spirit a guide while interpreting the which are used as raw content of the said Entry and materials in the production therefore, its scope and ambit of potable alcohol and being amplified beyond what other products. However, it really envisages as a field it does not include the of legislation for the States to final product (such as legislate upon. a hand sanitiser) that contains alcohol since such an interpretation will substantially diminish the scope of multiple other legislative entries;

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h. The judgment in Synthetics The judgment in Synthetics (7J) (supra) is overruled in and Chemicals (7J) need not terms of this judgment; be overruled in relation to Section 18G of the IDRA and it continues to be good law in the context of what is comprised in the expression “industrial alcohol” and “intoxicating liquors” except what has been clarified above in Entry 8 – List II. i. Item 26 of the First Item 26 of the First Schedule Schedule to the IDRA of the IDRA must be read must be read as excluding excluding only what is the industry “intoxicating contained in the expression liquor”, as interpreted in this “intoxicating liquors” as judgement; interpreted above in Entry 8 – List II. j. The correctness of the In my opinion, Tika Ramji judgment in Tika Ramji is held to be not good law (supra) on the interpretation insofar as the requirement of of word ‘industry’ as it issuance of a notified order as occurs in the Legislative a condition precedent for the entries does not fall for field to be occupied, has been determination in this mandated therein. reference; and k. The issue of whether Denatured alcohol belongs Section 18G of the IDRA to the family of “industrial covers the field under Entry alcohol” and therefore, Section 33(a) of List III does not 18G of the IDRA has a bearing arise for adjudication in view on the said product. Section of the finding that denatured 18G occupies the field under alcohol is covered by Entry Entry 33(a) – List III and, 8 of List II.” thereby, only Parliament is competent to legislate on all articles or class of articles related to a scheduled industry i.e. “Fermentation Industries”.

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34. Reference is answered in the above terms.

35. The Registry to place the matters before Hon’ble the Chief Justice of India for seeking orders for being listed before the appropriate Bench.

36. I must place on record my sincere appreciation to the learned Attorney General, learned Solicitor General and their teams, learned senior counsel appearing for the respective parties, learned instructing counsel and learned counsel for the respective parties for their valuable assistance to this Bench.

Result of the Case: Reference answered in above terms.

† Headnotes prepared by: Ankit Gyan