STATE OF M.P 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 established that the licence fee, payable in advance in 24 instalments, is essentially a rent for the privilege of manufacturing and vending liquor, not a consideration for the sale of liquor. The Court clarified that the State cannot impose excise duty in advance on undrawn liquor, distinguishing between excise duty and licence fee.