State of Tamil Nadu and Ors. v. TVL. South Indian Sugar Mills Assn. and Ors. - (Supreme Court) (12 Aug 2015)
Fee collected by State from industry must bear reasonable nexus to curbing illegal activity in the same industry
MANU/SC/0853/2015
Excise
Fee and excise duty collected from an industry to prevent illegal activities which have no causal connection with that industry will 'metamorphose into a tax'. In a case where producers of industrial alcohol questioned the legality of a Re.1 per bulk litre fee charged by the state, the Court upheld the imposition of the fee. Recovery of the fee would be permissible, so long as expenses incurred by the state government are for ensuring that industrial alcohol is not used as potable alcohol.
Relevant : State of U.P. v. Vam Organic Chemicals Ltd. MANU/SC/0833/2003 B.S.E. Brokers' Forum, Bombay and Ors. v. Securities and Exchange Board of India and Ors. MANU/SC/0069/2001 Synthetics and Chemicals Ltd. v. State of U.P. MANU/SC/0595/1989
Tags : FEE TAX CAUSAL RELATIONSHIP QUID PRO QUO
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