State Of M.P & Ors vs Lalit Jaggi

The Supreme Court upheld the High Court's decision declaring Clauses 13.3 and 13.4 of the Liquor Policy ultra vires Article 14 of the Constitution and Section 25 of the M.P. Excise Act, 1915. The Court clarified that the licence fee, payable in advance in instalments, is essentially a rent for the privilege of manufacturing and vending liquor, not a consideration for the sale of liquor. The Court distinguished between excise duty and licence fee, affirming that the State cannot impose duty in advance on undrawn liquor.