M/s. K. Raj and Co. vs State of Maharashtra

Ashok Agarwal, J.—Whether the product Ethanol AR can be classified as intoxicant or liquor as defined under the Bombay Prohibition Act, 1949, is a short question which arises for consideration in the present petition.

The petitioners are a firm engaged in the business of importing and dealing in diverse laboratory chemicals for the past 30 years. One such product with which the petitioners deal is Ethanol AR, where AR stands for analytical reagent. The said product consists of alcohol of a very high purity i.e. 99.9%. The petitioners supply the said product to various parties which are :-

(a) Government of India, Department of Atomic Energy.

(b) Department of Chemical Technology, University of Bombay.

(c) Indian Institute of Technology.

(d) Institute of Immunohaematology.

(e) Maharashtra Pollution Control Board, Central Laboratory.

(f) National Chemical Laboratories, Pune.

(g) University of Pune, Biology/Chemistry Department.

(h) Indian Association for Cultivation of Science, Calcutta.

(i) Serum Institute of India Ltd., Pune.

(j) Defence Research and Department Establishment, Kanpur.

On 22nd June, 1993 another concern Unique Biochemicals imported 4994 bottles each of 500 ml. Ethanol AR from abroad. On 20th July, 1993 the petitioner purchased the aforesaid bottles for being distributed to various customers. On 27th July, 1993 the respondent the State of Maharashtra through its State Excise Department carries out a raid on the premises of the petitioners and seized the aforesaid stock. One Shri Tolani, a partner of the petitioner firm as was arrested in connection with offences under Sections 65(a)(e), 66(1)(b), 80, 86 and 103(1) of the Bombay Prohibition Act. The said Tolani was produced before the Magistrate at 5 p.m. on 27th July, 1993 and was remanded to the custody. In the remand application it was alleged that the accused was arrested while in possession of absolute alcohol which is a restricted item under the said Act and the Rules. According to the prosecution, the accused has purchased 4994 x 500 ml. bottles of absolute alcohol AR. Quality Ethyl Alcohol 99.9% v/v from M/s. Unique Biochemicals without a licence or authorisation granted by the State of Maharashtra. As per the prosecution ''liquor'' is defined under the Prohibition Act under S. 2, sub-section (24) to mean all liquids consisting of or containing alcohol or any other intoxicating substances which the Government may declare for the purpose of the Act. Thus any liquid containing alcohol whether fit or unfit for use as intoxicant liquor are covered by this definition. The definition liquor is coined in such a way that it should include alcohol which is not potable. Any addict neither cares for the consequences of the drinking nor he cares to know whether the alcohol he drinks is potable or denatured or harmful to his health. Therefore, there is no alternative before the Legislature but to control all types of alcohols, within the power vested in the Constitution. Therefore, it is incumbent on the firm/marginal noted accused to avail himself of a licence in Form R.S. VI i.e. licence authorising him to buy, possess and sell rectified spirit including absolute alcohol. The State Government has, therefore, endeavoured to bring a prohibition on all intoxicants which are injurious to health. It is, therefore, well within its meaning to include all alcoholic liquids as intoxicants. The marginal noted accused has failed to obtain necessary licence and therefore, has committed an offence under the Bombay Prohibition Act, 1949. It is also imperative to mention that such huge stock of alcohol if allowed to move without restriction, could have caused injury and also resulted in bottling of spurious potable liquor. Therefore, it is requested that the marginal noted accused be remanded to jail custody till investigations are completed. As already stated, on the aforesaid remand application being presented, the Metropolitan Magistrate remanded Shri Tolani, who is one of the partners of the petitioners, to jail custody till 3rd August, 1993. On 28th July, 1993 an application for bail was presented and Shri Tolani was released.

The present petition seeks to quash the prosecution which is sought to be lodged by the respondent against the petitioners. It further claims the return of the seized stock of 4564 bottles of Ethanol AR. It is inter alia contended by the petitioners that the seizure, arrest and investigation initiated by the respondents are without jurisdiction as the product Ethanol AR is not and cannot be held to be an intoxicant under the Bombay Prohibition Act, 1949.

In this context the relevant provisions of the Bombay prohibition Act may be quoted.

"65. Whoever, in contravention of the provisions of this Act, or of any rule, regulation or order made or of any licence, pass, permit or authorization granted thereunder -

(a) imports or exports any intoxicant other than opium or hemp,

x x x x

(c) sells or buys any intoxicant other than opium or hemp, shall, on conviction, be punished for each such offence with imprisonment for a term which may extend to three years and also with fine."

"66. (1) Whoever in contravention of the provisions of this Act, or of any rule, regulation or order made or of any licence, permit, pass or authorization issued, thereunder -

(b) consumes, uses, possesses or transports any intoxicant other than opium or hemp,

shall on conviction be punished ...."

It would thus appear that the aforesaid provisions of Sections 65 and 66 in so far they relate to the petitioners make possessions and sale of intoxicant as an offence. The term ''intoxicant'' is defined in S. 2(22) as under :-

"2(22). "intoxicant" means any liquor, intoxicating drug, opium or any other substance, which the State Government may, be notification in the Official Gazette, declare to be an intoxicant."

"The term ''liquor'' has been defined in Section 2(24) as follows :-

2(24). "Liquor" includes -

(a) spirits, denatured spirits, wine, beer, toddy and all liquids consisting of or containing alcohol; and

(b) any other intoxicating substance which the State Government may, by notification in the Official Gazette, declare to be liquor for the purposes of this Act."

It is nobody''s case that the product Ethanol AR is a potable drink. According to the prosecution, the said product can be utilised for manufacturing a potable alcoholic drink and is, therefore, covered within the mischief of the Prohibition Act. In this context a reference can usually be made to the case of Synthetic & Chemicals Ltd. v. State of U.P., . Where the Supreme Court was concerned with industrial alcohol of 95% purity and were considering the question whether it is an intoxicating liquor. The Supreme Court observed to the following effect :-

"Industrial alcohol as it is, incapable of being consumed by a normal human being. The expression ''consumption'' must also be understood in the sense of direct physical intake by human beings in this context. It is true that utilisation in some form or the other is consumption for the benefit of human beings if industrial alcohol is utilised for production or rubber, tyres used, the utilisation of those tyres in the vehicle of man cannot in the context in which the expression has been used in the Constitution, be understood to mean that the alcohol has been for human consumption. The expression ''alcoholic liquor for human consumption'' means that liquor which as it is consumable in the sense capable of being taken by human being as such as beverage or drinks."

The Supreme Court has further observed that it has to be borne in mind that by common standards ethyl alcohol (which has 95%) is an industrial alcohol and is not fit for human consumption. ...... Rectified spirit for industrial purposes is defined as ''spirit purified by distillation having a strength not less than 95% of volume of ethyl alcohol". Dictionaries and technical books would show that rectified spirit (95%) is an industrial alcohol and is not potable as such. It appears, therefore, that industrial alcohol which is ethyl alcohol (95%) by itself is not only non potable but is highly toxic. The range of spirits of potable alcohol is from country spirit to Whisky and the Ethyl Alcohol content varies between 19 to about 43 per cent. These standards are according to the ISI specification. In other words, ethyl alcohol (95%) is not alcoholic liquor for human consumption but can be used as raw material in-put after possessing and substantial dilution in the production of Whisky, Gin, Country Liquor, etc. In many decisions, it was held that rectified spirit is not alcohol fit for human consumption ...... The meaning of the expression "intoxicating liquor" has been rightly interpreted by the Bombay High Court in the Balasara''s case, AIR 1951 SC 318 : 1951 (52) Cri LJ 1361. In that light perhaps, the observations of Fazal Ali, J. in the very same case requires consideration. It appears that in the light of the new experience and development, it is necessary that "intoxicating liquor" must mean liquor which is consumable by human being as it is and as such when the word "liquor" was used by Fazal Ali, J. they did not have the awareness of full use of alcohol as industrial alcohol. It is true that alcohol was used for industrial purpose then also, but the full potentiality of that user was not then comprehended or understood. With the passage of time, meanings do not change but now experiences give new colour to the meaning.

Applying the ratio of the aforesaid case it is abundantly clear that as far as the product Ethanol AR is concerned, the same cannot be equated with intoxicating liquor. Merely because the product can be used for the purpose of manufacturing intoxicating liquor would not ipso facto make it intoxicating liquor. The product in fact is used for several industrial, chemical purpose and it is an analytical reagent used by various Government and semi-Government and other institutions for various other purposes. Hence the product as it is cannot be termed an intoxicant liquor so as to attract the provisions of the Bombay Prohibition Act.

Shri Nalawade, the learned Additional Public Prosecutor, has drawn our attention to the Bombay Prosecutor, has drawn our attention to the Bombay Rectified Spirit Rules, 1951. He has pointed out that Rule 4 provides that any person desiring to posses and use rectified spirit for any bona fide medicinal, industrial, scientific, educational, pathological purposes requires a licence. The petitioner have not applied and do not possess a licence as required under Rule 4 and are, therefore, liable to be prosecuted under sections 65 and 66 of the Bombay Prohibition Act. It will, therefore, be necessary to find out whether the product Ethanol AR can be classified as rectified spirit. "Rectification" has been defined under S. 2(37) as under :-

"(37) ''rectification'' includes every process whereby liquor is purified or refined."

It is nobody''s case that Ethanol AR has been prepared by process of purifying or refining liquor. The product Ethanol AR cannot be termed as rectified spirit. The same cannot be said to have been prepared by any process whereby liquor is purified or refined. It is not liquor as it is not a spirit, denatured spirit, wine, beer, today or a liquid consisting or containing alcohol. It is just alcohol in its purest form. It is not an intoxicant as it is not liquor and hence we are constrained to hold that the provisions of the Bombay Prohibition Act are not attracted and hence the prosecution sought to be launched against the petitioner is misconceived. Similarly, the seizure in respect of the 4564 bottles each of 500 ml. of Ethanol AR is without the authority of law. Hence the said prosecution is quashed and the said bottles are directed to be delivered back to the petitioners. Rule absolute.

At this stage Shri Nalawade prays for stay of our order. Since we have merely followed the Supreme Court decision in the case of Synthetic & Chemicals Ltd. v. State of U.P., , the prayer is rejected.

Issue of certified copy is expedited.

Ordered accordingly.