KALYANI STORES vs THE STATE OF ORISSA AND OTHERS

The Supreme Court ruled that the enhancement of the excise duty on foreign liquor imported into the State, as per the notification dated March 31, 1961, was invalid under Article 301 of the Constitution, as it imposed a restriction on the freedom of trade without justification under Article 304. The Court held that countervailing duties can only be levied if similar goods are produced within the State, which was not the case here. However, the original duty of Rs. 40 per gallon, established by the 1937 notification under Section 27 of the Bihar and Orissa Excise Act, 1915, was upheld as it constituted existing law protected by Articles 305 and 372 of the Constitution.