Sat. Sep 19th, 2020

Amendment in the Industries (Development and Regulation) Act, 1951 to transfer authority to regulate ‘potable alcohol’ to States, receives Cabinet approval

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The Union
Cabinet has given its approval to the Amendment in the First Schedule of
Industries (Development and Regulation) Act, 1951 to transfer the authority to
regulate ‘potable alcohol’ to States as recommended by the Law Commission in
its 158th Report. The existing heading “26 Fermentation Industries”
in the First Schedule of the Act shall be substituted with the heading “26
Fermentation Industries (other than potable alcohol)”. A bill to this effect
will be introduced in the Parliament.

The amendment is
proposed to resolve a long standing confusion between jurisdiction of Central
and State Government on Alcohol, Potable Alcohol and Industrial Alcohol. The
amendment will ensure that the industries engaged in manufacturing alcohol
meant for potable purposes shall be under the total and exclusive control of
State Governments in all respects. This will also assign accountability to
State for manufacture of potable alcohol.

The Supreme Court
in Distillery v. Union of India, (1997)
2 SCC 727 has held that industries engaged in manufacturing alcohol meant for
potable purposes shall be under the control of the State and controls
concerning Industrial Alcohol shall be under the jurisdiction of the Central
Government. This resulted in certain problems regarding interpretation of
constitutional provisions. Thus, the law commission taking suo-moto cognizance
of the emerging confusion recommended substituting Item 26 of the First
Schedule of Industries (Development and Regulation) Act, 1951 as “Fermentation
Industries (not including alcohol)”.    

-Ministry
of Commerce and Industry
Source: Legal news India

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