M/S Kesar Enterprises Ltd vs State Of U.P. & Ors

The Supreme Court held that the State Government lacked authority to levy Excise duty under Section 28 of the U.P. Excise Act, 1910 on rectified spirit but could impose penalties under Rule 633(7) of the Uttar Pradesh Excise Manual for non-delivery. The Court emphasized that the indemnity bond executed by the appellant created a liability to pay duty for short delivery, thus upholding the Excise Commissioner's demand for payment. The appeal was dismissed, affirming the High Court's decision.