State Of U.P. & Ors vs M/S Lalta Prasad Vaish

The Supreme Court upheld the Allahabad High Court's decision declaring the licence fee levied on the sale of specially denatured spirit under the Uttar Pradesh Excise Act, 1910 as illegal. The Court emphasized that the fee was neither regulatory nor compensatory, as no services were rendered to justify its imposition. The ruling referenced the case of State of U.P. Vs. Vam Organic Chemicals Ltd (2004 (1) SCC 225), establishing that the State lacks legislative power over denatured spirit, thus invalidating the fee and ordering its refund with interest.