vil Appeal No 1845 N of 1974
From the Judgment and Decree dated 6731974 of the Bombay High Court in First Appeal No 586 of 1969
133 SK Dholakia and HS Parihar for the Appellant
AK Ganguli AM Khanwilkar A Subba Rao CV Subba Rao and AS Bhasme for the Respondents
The appellant is a Limited Company registered under the Companies Act having its registered office situate at Ahmed nagar within the State of Maharashtra
The appellant carries on business inter alia as manufacturers of Ayurvedic preparations including Asavas Aristhas
At all times material to this appeal the appellant was manufacturing and selling an Ayurvedic product called Ashvagandhaarist which is a medicinal preparation containing self generated alcohol but not capable of being consumed as ordinary alcoholic beverage
Under the provisions of the Medicinal and Toilet Prepara tions 
Excise Duties Act 1955 hereinafter referred to as the Act which came into force on 1st April 1957 excise duties were levied on medicinal and toilet prepara tions specified in the Schedule to the Act hereinafter referred to as the Schedule
The Act as originally stood in 1955 inter alia contained two items in the Schedule respectively specifying medicinal and toilet preparations containing alcohol which are prepared by distillation or to which alcohol has been added and which are capable of being consumed as ordinary alcoholic beverage and medicinal and toilet preparations not otherwise specified containing alcohol being the commodities excisable under the provi sions of the Act
The said Ashvagandhaarist was treated and accepted by the Excise Authorities as being exempt from the payment of any excise duty upon the basis and the foot ing that the same was an Ayurvedic preparation containing self generated alcohol which was not capable of being con sumed as ordinary alcoholic beverage and which fell under item 2i Of the Schedule in respect of which the rate of excise duty postulated in the Schedule was Nil
The Act was amended by the Amendment Act 19 of 1961
The amendment inter alia introduced the concept of patent and pro 134 prietary medicine in the Schedule
The amendment Act however by an Explanation introduced in the Schedule the definition of the patent and proprietary medicine con tained in the Drugs Act 1940
Even after the introduction of the said amendment the appellant s aforesaid product continued to be treated as exempt from the liability to pay any excise duty on the self same ground namely that it was covered under item 2i of the Schedule which item 2i was renumbered as item 3i of the Schedule as amended by the Amendment Act of 1961
By Section 18 of the Finance Act 1962 the Act was further amended by substitution of an Explanation No 1 to the Schedule of the Act
By virtue of and under the said Explanation a patent and proprietary medicine was defined as a medicinal preparation of the description and the type specified in the Explanation
The Explanation which was brought in by the Finance Act was given retrospective effect from April 23 1962
In purported pursuance of the said Explanation andor upon the basis thereof a circular dated May 31 1962 was issued by the then Director of Prohibition and Central Excise Government of Maharashtra Bombay which inter alia directed that the medicinal preparations containing self generated alcohol but not capable of being consumed as alcoholic beverage were to be treated as products falling under item 1 and not item 3 of the Schedule
consequent thereupon the respondents levied and recovered from the appellant diverse sums aggregating to Rs2 1828216 being the alleged amount of the excise duty payable in respect of the product Ashvagandharist
The amounts were paid by the appellant under protest
With a view to enforcing their rights in respect thereof andor recovering the said amount illegally recovered by the respondents on July 14 1965 the appellant filed a suit being Special Suit No 23 of 1965 in the Court of Civil Judge Senior Division Ahmednagar
On March 4 1966 the respondent No 4 filed its written statement and similarly on the 4th April 1966 the respond ent Nos 1 to 3 filed written statements
In the written statements filed on behalf of the respondents it was inter alia contended that the said product of the appellant was the unrestricted ayurvedic preparations manufactured by the plaintiff appellant labelled and marked by the 135 plaintiff appellant under their brand name and trade mark
This therefore fell within the scope of patent or proprie tary medicine as given in Explanation 1 below the Schedule annexed to the Act as inserted from April 23 1962 by Finance Act No 2 1962
By his Judgment and Decree dated March 27 1969 the learned Civil Judge was pleased to decree the appellant s suit for Rs22258207 together with future interest at 6 per cent per annum from the date of the suit till realisa tion
Aggrieved by the Judgment and Order dated March 27 1969 the respondents being the defendants therein pre ferred an appeal to the High Court of Judicature at Bombay which was registered as First Appeal No 586 of 1969
The said appeal was heard by the High Court alongwith other appeals being First Appeals Nos
136 of 1968 and 93 of 1970 as also suits being Suit Nos 230 of 1965 and 319 of 1965
The appeals and the suits were heard together having regard to the common questions of law involved therein
By its judgment and decree the High Court was pleased to allow the said first appeal of the respondents reversing the judgment and decree of the Trial Court and to dismiss the appellant s special suit
Hence this appeal by special leave
Mr SK Dholakia the learned counsel for the appellant submits inter alia that the findings of the High Court are repugnant to the relevant provisions of the Act andor the rules framed thereunder andor the scheme intendments and purposes thereof
It is contended that the appellant s product Ashvagandhaarist fell squarely within item 3i of the Schedule and as such wholly exempt from the payment of excise duty that in view of the admitted position that until 1962 Ashvagandhaarist was exempt from the payment of excise duty as being a commodity falling under item No 2i of the Schedule simply by reason of the Explanation which was introduced in the Act by the Finance Act of 1962 as the explanation could never be considered to be or in any event in the scheme of the provision of the Act was not a substantive provision of the Act and the explanation was not intended to and it did not seek to disturb the enumeration of the categories or the respective fields assigned to the various items of the schedule in existence prior thereto
It is submitted that item 3 of the amended Schedule was a specific item and enumerated categories of Ayurvedic medici nal preparations covered thereby and that being so all commodities answering description set out therein fell within the 136 ambit thereof and was excluded from the purview of the other items contained in the said schedule and that the express language of item 3i namely of Ayurvedic preparations containing self generated alcohol which were not capable of being consumed as ordinary alcoholic beverages were exempt ed and that the appellant s product Ashvagandhaarist was admittedly and obviously an Ayurvedic preparation containing self generated alcohol which was not capable of being con sumed as ordinary alcoholic beverage and as such it could not be made excisable on the ground that it fell within any other item of the schedule but it constituted residuary clause of the schedule in so far as the medicinal and toilet preparations containing alcohol were concerned
Counsel further submits that the expression not otherwise speci fied occurring in item 3 of the schedule did not restrict the scope of the enumerated categories under item 3 but was merely a marginal note showing that the said item 3 was residuary item and comprised of three sub groups of commodi ties specified therein and that item No 1 was not a speci fied item
Mr Dholakia further submits that the interpreta tion that ashvagandhaarist fell within item No 1 rendered the provisions of item No 3 wholly nugatory inasmuch as if an Ayurvedic preparation containing self generated alcohol but incapable of being used as ordinary alcoholic beverage is treated as failing under item 1 there would be no Ayurvedic medicine which would factually fail under item 3 of the schedule and that the Explanation newly introduced by the Finance Act 1962 could not add to amend or alter or vary the classification of the goods existing prior thereto as covered by the various items of the said schedule nor could it otherwise nullify or add to amend or alter or vary the substantive provisions of the schedule and it could not be considered to be a substantive provision of the Act nor could it be allowed to abrogate the substantive provisions of the Act
In other words the submission is that in view of the fact that the product of the appellant was exempt from payment of duty because the duty against item No 3i in the amended Schedule of 1961 was mentioned to be nil  the High Court ought to have held that the said legal and factual position could not be transformed to the detriment of the appellant by shifting the said commodity from the field covered by item 3i to that covered by item 1 of the Act merely on the basis of the Explanation which was intro duced by the Finance Act of 1962
Counsel argues that this was more so because ashvagandhaarist was not a name within the contemplation of the explanation but was merely a de scriptive appellation of the medicine manufactured and sold by the appellant and it being a standard preparation accord ing to the Ayurvedic system could be manufactured by any one conversant with the said system and it did 137 not have a brand name in the hands of the appellant and the High Court s interpretation that a mere description is a name is inconsistent with the scheme of the definition of patent and proprietary medicines in the Explanation
This was the reason it is argued why Asavas and Aristhas were expressly made non dutiable after 25964
by subsequent amendment by the Government
Mr AK Ganguli learned counsel appearing for the respondents demurring submits that there can be no doubt that Asavas and Aristhas fall under item 1 of the sched ule to the Act as substituted by Finance Act 2 of 1962 and hence taxable at 10 ad valorem and those being Ayurvedic preparations are specified preparations and they could never fail under item 3 or any part thereof which deals with medicinal preparations not otherwise specified containing alcohol
Item 1 Mr Ganguli submits specifically describes that medicinal and toilet preparation which has alcoholic contents and which alcohol comes to be present in those medicines by use of one of the two methods described in that item
First of such methods contemplates alcohol contents in the medicine which is prepared by distillation and the second method is addition of alcohol to the medicine
The medicinal preparation which is prepared by distillation and which contains alcohol and other medicinal preparations to which alcohol is added fall in category I and such medicines would cover medicinal preparations belonging either to Allopathic or Ayurvedic system or I any other system of medicines
For every system of medicines counsel argues item No 1 is not general item but it is a specific item in the sense it covers only those medicines which are prepared by distillation and contain alcohol and others to which alcohol has been added
According to counsel such medicines belonging to any system whether indigenous or foreign are covered by item 1 and would be taxable as per that item and the disputed goods are undoubtedly medicinal preparations and they are also patent and proprietary medicines in view of the Explanation 1 and these Ayurvedic preparations are medicinal preparations being patent or proprietary medicines containing alcohol which are not capable of being consumed as alcoholic beverages and as such they squarely fall under item 1 of the Schedule and the main Act and the Explanation is a self contained provision which eliminates the reference either to Drugs Act or to the Rules made under the Act and one has to read only the provision of the Schedule as a whole including the Explanation and their meaning being simple and plain they must be given their full effect
138 To appreciate the rival contentions we can appropriately refer to the provisions and the Schedule of the Act and the legislative changes thereof
The Act was meant to provide for the levy and collection of duty of excise on medicinal and toilet preparations containing alcohol opium Indian hemp or other narcotic drug or narcotic
The statement of objects and reasons as notified in Gazette of India of 1691954 Part II section 2 Ext page 596 said that by virtue of entry 40 in List II in the Seventh Schedule to the Gov ernment of India Act 1935 medicinal and toilet prepara tions containing alcohol etc were subjected to Provincial excise duties
In order to secure uniformity the entry relating to excise duty on medicinal and toilet preparations containing alcohol etc were transferred under the Consti tution from the State list to the Union List
The Act was intended to implement this provision in the Constitution and proposed uniform rates of excise duty and a uniform proce dure for the collection thereof
The Act came in force on 1457
The Act in Section 2a defined alcohol to mean ethyl alcohol of any strength and purity having the chemical composition C2H5OH and it defined medicinal preparation in Section 2g to include all drugs which are a remedy or prescription prepared for internal or external use of human beings or animals and all substances intended to be used for or in the treatment mitigation or prevention of disease in human beings or animals
It did not define drug
The Drugs Act 1940 as it was substituted by the Drugs Amend ment Act 1955 16455 had defined drug in Section 2b to include i all medicines for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis treatment mitigation or prevention of disease in human beings or animals other than medicines and substances exclusively used or prepared for use in accordance with the Ayurvedic or Unani systems of medicine and ii such substances other than food intend ed to affect the structure or any function of the human body or intended to be used for the destruction of vermins or insects which cause disease in human beings or animals as may be specified from time to time by the Central Government by notification in the Official Gazette Emphasis supplied Section 3i of the Act provides that there shall be levied duties of excise at the rates specified in the Schedule on all dutiable goods manufactured in India
 The original Schedule to the Act in 1955 read 139 THE SCHEDULE See section 3 Item Description of dutiable Rate of No goods
Medicinal and toilet preparations Rupees seven containing alcohol which are prepared and annas eig which are prepared by distilation or ht per gallon to which alcohol has been added and of strength which are capable of being consumed as of London ordinary alcoholic beverages
proof spirit
Medicinal and toilet preparations not otherwise specified containing alcohol i Ayurvedic preparations containing Nil self generated alcohol which are not capable of being consumed as ordinary alcoholic beverages
ii Ayurvedic preparations containing Rupees three self generated alcohol which are per gallon
capable of being consumed as ordinary alcoholic beverages
iii All others
Rupees five per gallon of the strength of London proof spirit 3
Medical and toilet preparations Nil not containing alcohol but containing opium Indian hemp or other narcotic drug or narcotic
It would thus be clear that medicinal and toilet prepara tions were classified into those which were capable of being consumed as ordinary alcoholic beverages and those which were not capable of being consumed as ordinary alcoholic beverages
Again medicinal and toilet preparations contain ing alcohol prepared by distillation or adding alcohol is differentiated from medicinal and toilet preparations not otherwise specified containing alcohol 
Further under this not 140 otherwise specified  category Ayurvedic preparations have been classified into three groups namely Ayurvedic prepa rations containing self generated alcohol not capable of being consumed as ordinary alcoholic beverages those capa ble of being consumed as ordinary alcoholic beverages and others
These three divisions were not drugs as defined in Drugs Act then
The first category of Ayurvedic preparations had not been subjected to duty while the other two catego ries had been
Admittedly under the above Schedule the product of the appellant ashvagandhaarist  was not dutiable which meant that it was included in item 2i
It would also be clear that Ayurvedic preparations containing self generated alcohol which were capable of being consumed as ordinary alcoholic beverages  were dutiable at the rate of Rupees 3 per gallon and the third category of others was also dutia ble at the rate of Rupees 5 per gallon on the strength of London proof spirit
Alcohol and self generated alcohol were treated differently
The Schedule was amended by the Amending Act No 19 of 1961 and the amended Schedule stood as follows Item No Description of dutiable goods Rate of duty 1
Medicinal preparations being patent Ten per cent or proprietary medicines contain ad valorem
ing alcohol and which are not capable of being consumed as ordinary alcoholic beverages
Medicinal preparations containing Rupees three alcohol which are and eight prepared by distillation or to which five naye alcohol has been added paise per and which are capable of being litre of consumed as ordinary alcoholic the streng beverages
th of Londo n proof spi rit
Medicinal preparations not otherwise specified containing alcohol i Ayurvedic preparations containing Nil self generated alcohol which are not capable of being consumed as ordinary alcoholic beverages
141 ii Ayurvedic preparations contain Thirty eight ing self generated alcohol which naye paise per are capable of being consumed as litre
ordinary alcoholic beverages
iii All others
Rupee one and ten naye paise per litre of the strength of London proof spirit
Explanation I Patent or proprietary medicines has the same meaning as in clause h of Section 3 of the Drugs Act 1940 23 of 1940
The statement of objects and reasons of the Amendment Bill as published in Gazette of India 831961 Pt
II section 2 Ext page 106 said Consequent on the decision to adopt metric units from the 1st April 1961 in the sale of alcohol and collection of duty thereon it is proposed to provide for the levy and collec tion of excise duty on medicinal and toilet preparations in terms of metric units       
Under existing item 2ii of the Schedule to the Act Ayurvedic preparations containing self generated alcohol which are capable of being consumed as ordinary alcohol ic beverages are subjected to duty at the rate of Rs3 per gallon
However by virtue of the provision contained in section 192xix of the Act read with Rule 8 of the Medicinal and Toilet Preparations Excise Duties Rules 1956 the rate of duty with respect to such preparations has been reduced to Rs 175 per gallon with effect from the 10th September 1960 and it is this reduced rate that is proposed to be expressed in terms of metric units in the Bill
 It would thus be clear that the main purpose was the levy and collection of excise duty on medicinal and toilet preparations in terms of metric unit
while there was refer ence to them existing item 2ii of the Schedule of the Act namely Ayurvedic preparations containing 142 self generated alcohol which were capable of being consumed as ordinary alcoholic beverages the duty whereof was reduced to Rs 175 per gallon from Rs3 per gallon there was no mention that item No 2i of the Schedule namely Ayurved ic preparations containing self generated alcohol which were not capable of being consumed as ordinary alcoholic bever ages was subjected to tax
The statement of object and reasons was silent about item No 2i
In the amended Schedule we find that item 1 for the first time mentioned medicinal preparations being patent or proprietary medicines containing alcohol and which are not capable of being consumed as ordinary alcoholic beverages and the earlier item No 1 has been re numbered as item No 2 and the earlier item No 2i ii and iii remained as they were as 3i 3ii and 3iii
As regards levy of duty item 2i of the old Schedule was kept duty free in item 3i of the Schedule
Thus there has been no fresh charging of duty on what was 2i and is now 3i under which catego ry the appellant s product ashvagandhaarist  was exempted from duty before the amendment of the Schedule
There is therefore no doubt that item 1  2i remained mutually exclusive or in other words they would not be overlapping
Item 1 in the amended Schedule deals with medicinal prepara tions being patent or proprietary medicines and not medici nal preparations not otherwise specified  The Explanation I says that patent or proprietary medi cines has the same meaning as in clause h of Section 3 of the Drugs Act 1940
The High Court has found that re num bered definition 3h was earlier 3d and read as follows 3d Patent or proprietary medicine  means a drug which is a remedy or prescription pre pared for internal or external use of human beings or animals and which is not for the time being recognised by the Permanent Commis sion on Biological Standardisation of the World Health Organisation or in the latest edition of the British Pharmacopoeia or the British Pharmaceutical Codex or any other Pharmacopoeia authorised in this behalf by the Central Government after consultation with the Board Thus patent or proprietary medicines meant a drug which was defined in the Drugs Act and not in the Act
The High Court rightly held that Ayurvedic medicine was not a drug at all
The definition of drug expressly excluded them
So the definition of patent or proprietary medicine 143 was exclusive of Ayurvedic medicinal preparations those being excluded from the definition of drug
The definition of patent and proprietary medicines till then did not apply to Ayurvedic preparations
This position continued indeed till the amendment of Drugs Act by the Drugs and Cosmetics Amendment Act 1964
Several amendments were effected by that Amendment Act of 1964
Section 33A and Chapter IV A were inserted
Section 33A said that Chapter IV was not to apply to Ayurvedic including Siddha or Unani drugs
Save as otherwise provided in this Act nothing contained in this Chapter shall apply to Ayurvedic including Siddha or Unani drugs
Chapter IVA madeprovisions relating to Ayurvedic including Siddha and Unani drugs
This shows that prior to this amendment of 1964 Ayurvedic preparations were expressly not drugs under the Drugs Act
The Drugs and Cosmetics Act in the amendment First Schedule after the amendment Act of 1964 included Ayurvedic including Siddha and Unani system drugs prepared under Section 3a which contains the definition Ayurvedic including Siddha or Unani drugs includes all medicines intended for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis treatment mitigation or prevention of disease in human beings and animals mentioned and process and manufac ture exclusively in accordance with the formula prescribed in the authoritative book on Ayurvedic Siddha Unani system of medicines specified in the first schedule
 This defini tion was also inserted by Drugs and Cosmetics Amendment Act 1964 13 of 1964 Section 2ai with effect from 1591964
The same exclusion remained in the related Central Acts
For example the Drugs Control Act 1950 Act 26 of 1950 replaced the Drugs Control Ordinance 1949 6 of 1949 which was promulgated on 310
1949 in order to ensure that cer tain essential imported drugs and medicines were sold in the reasonable price in the Chief Commissioner s provinces
Similar ordinances were issued by all the provinces
The necessity for continuing price control of these essential drugs continued
That was an Act to provide for the control of sale supply and distribution of drugs
Drug meant any drug as defined in clause b of Section 3 of Drugs Act 1940 in respect of which a declaration had been made under Section 3 which defined drug
It may be noted that Pharmaco poeia authorised for the purpose of Section 3h of the Drugs Act 1940 were The Indian Pharmacopoeia the Pharma copoeia of the United States the National formulary of the United States the International Pharmacopoeia and the State Pharmacopoeia 144 of the Union of Soviet Socialist Republics vide SO 701 Gazette of India 1961 Pt
II section 3ii p 725
There was thus no Ayurvedic Pharmacopoeia prescribed for the purpose of that Act
Pharmacopoeia is a book containing the list of drugs with directions for use
The fact that no Ayurvedic Pharmacopoeia had been notified at the relevant time was because Ayurvedic preparations were not drugs for the pur pose of Drugs Act and for that matter of  at the relevant time
It could be for this reason that in the original Schedule the expression medicinal and toilet preparations not otherwise specified  was used and Ayurvedic prepara tions of different categories were put under item 2
In the Schedule as amended by the 1962 Act this expression contin ued in item 3 The same definition of drug  also continued in the Drugs Act
From the Explanation I of the Schedule of the Act as substituted by Act 5 of 1964 also it is clear that patent or proprietary medicine means any medicinal preparation which is not specified in a monograph in a Pharmacopoeia Formu lary or other publications notified in this behalf by the Central Government in the Official Gazette
To be a patent medicine one would be required to have a patent
A patented article means an article in respect of which a patent is in force
Patent means a patent granted under the Indian Patent and  and now the Patent Act 1970
A patent medicine will therefore mean medicine in respect of which a patent is in force
Proprie tary means of a proprietor that is holding proprietary rights
Patent means a grant of some privilege property or authority made by the Government or sovereign of a country to one or more individuals
A proprietor is one who has the legal right or exclusive title to anything
It is synonymous with owner
A person entitled to a trade mark or a design under the acts for the registration or patenting of trade mark or design is called a proprietor of the trade mark or design
Under the  trade mark means i in relation to Chapter X other than section 81 a registered trade mark or a mark used in relation to goods for the purpose of indicating or so as to indicate a connection in the course of trade between the goods and some person having the right as proprietor to use the mark and ii in relation to the other provisions of this Act a mark used or proposed to be used in relation to goods for the 145 purpose of indicating or so as to indicate a connection in the course of trade between the goods and some person having the right either as proprietor or as registered user to use the mark whether with or without any indica tion of the identity of that person and includes a certification trade mark registered as such under the provisions of Chap
 As defined in section 2a registered proprietor in relation to a trade mark means a person for a time being entered in the register as proprietor of the trade mark
A registered trade mark means a trade mark which is actually on the register
By section 18 of the Finance No  the Schedule to the Act was further amended substituting the Explanation 1 by the following Explanation 1 Patent or proprietary medi cines means any medicinal preparation which bears either on itself or on its container or both a name which is not specified in a mono graph in a Pharmacopoeia Formulary or other Publications notified in this behalf by the Central Government in the Official Gazette or which is a brand name that is a name or a registered trade mark under the Trade and Merchandise Mark Act 1958 43 of 1958 or any other mark such as a symbol monogram label signature or invented words or any writing which is used m relation to that medicinal preparation for the purpose of indicating or so as to indicate a connection in the course of trade between as preparation and some person having the right either as proprietor or otherwise to use the name or mark with or without any indication of the identity of that person
 This amendment of the Explanation came into force in June 1962 with retrospective effect from 23rd April 1962
The Director of Prohibition and Excise for Maharashtra State Bombay thereafter issued the circular dated 315
1962 Ext 44
It said that the patent or proprietary medicines as defined in clause d of section 3 of the Drugs Act of 1940 23 of 1940 and falling under items No 1 and No 4 of the Act as substituted by the Amendment Act 1961 were prior to 23rd April 1962 subject to levy of duty at 10 per cent ad 146 valorem by virtue of the Explanation I below the Schedule to the Act which has now been deleted from 23rd April 1962
According to new definition of Patent and Proprietary Medicines  as given in the new Explanation as amended by Finance No medicinal preparations containing alcohol opium Indian hemp or other narcotic drugs or narcotic falling under item 3i 3iii and 3v of the said Schedule were with effect from 23rd April 1962 liable to duty not under the said items but under item No 1 or item No 4 of the said Schedule at 10 per cent ad valorem if such preparations are patent or proprietary medicines as defined in the Explanation
Excise duty on all patent or proprietary medicinal preparations  Alopathic Ayurvedic Unani and Homoeopathic preparations containing alcohol opium Indian hemp or other narcotic drug or narcotic which fall within the purview of the new definition of patent or proprietary medicines  given in the Explanation should therefore be recovered at the rate of 10 per cent ad valo rem from the holders of the licences granted under the said Act and the rules thereunder in accordance with the instruc tions contained in their Circular No DQ 64 3161 dated 22nd July 1961
A note received from the Government of India explaining the scope of the new definition of patent or proprietary medicines  was also enclosed along with the circular
It is in evidence in the instant case that two bottles containing Asavas were produced in the Court as Exhibit 421 and Exhibit 422
Both the bottles contained the same kind of Asavas
The ingredients of the two were the same and the preparation of the two was also the same
When the Asavas were sold during the period beginning from June 1962 to February 1964 no excise duty was levied because on the label there was no trade mark of patent and proprietary right printed
If the Asavas were sold in the bottle having a label with no trade mark as at Exhibit 421 no duty was recovered from the plaintiff
These Asavas were supplied to Employees  State Insurance as per their tender without the trade mark on the label to see that the plaintiffcompany were not taxed the excise duty which would have been charged had they put the patent mark on the label
But in order to fight for blemish of cheating the plaintiff thought it necessary to have the trade mark on such bottles without any difference
As soon as the goods were sought to be sold in the above manner the excise duty was levied and was sought to be recovered from the plaintiff s fund
No excise duty was recovered after February 1964 even though Asavas were sold with their trade mark
It is also in evidence that there were two sub groups in the group of Asavas and Aris thas known as restricted  and unrestricted 
Restricted means preparations which 147 could be used as alcoholic beverages
In this case the period from 26762 to 29264 is alone material inasmuch as by the Finance Act of 1964 with reference to item No 1 the Ayurvedic and Unani medicines containing self generated alcohol and which were not capable of being consumed as ordinary alcoholic beverages were exempted from the levy of excise duty
In other words the position prior to Finance Act of 1962 was continued and thereafter the medicinal preparations namely Asavas and Aristhas ceased to be taxed from 1964
It would be noted that the Explanation itself did not specifically mention Allopathic Ayurvedic Unani and Homoeopathic preparations as was done in the Director s Circular
On a comparison of the earlier Explanation and the substituted Explanation one would notice that earlier patent and proprietary medicines meant a drug
In the substituted Explanation it means any medicinal preparation
However it can not be lost sight of that the words medici nal preparation as continued to be defined in section 2g of the Act includes all drugs which are a remedy or prescrip tion prepared for internal or external use of human beings or animals and all substances intended to be used for or in treatment mitigation or prevention of diseases in human beings or animals
 We have already noticed that the Drugs Act continued to exclude Ayurvedic preparations till its amendment in 1964
It has been stated that even after amend ment of the Schedule after 1961 amendment the appellant s product was exempted from duty till the Director s Circular disturbed the position
This brings us to the question of interpretation of the Act and the Schedule with the Explanation
in view of the submission that the Explanation could not have rendered item 3i of the Schedule redundant
Was there any change of intention of the Legislature in this regard A Schedule in an Act of Parliament is a mere question of drafting
It is the legislative intent that is material
An Explanation to the Schedule amounts to an Explanation in the Act itself
As we read in Halsbury s Laws of England Third Edition Vol 36 para 551 To simplify the presentation of statutes it is the practice for their subject matter to be divided where appropriate between sections and schedules the former setting out matters of principle and introducing the latter and the latter containing all matters of detail
This is purely a matter of arrangement and a schedule is as much a part of the statute and as much an enactment as is the section by which it is introduced
 The schedule may be used in construing provisions in the 148 body of the Act
It is as much an act of Legislature as the Act itself and it must be read together with the Act for all purposes of construction
Expressions in the Schedule cannot control or prevail against the express enactment and in case of any inconsistency between the schedule and the enactment the enactment is to prevail and if any part of the schedule cannot be made to correspond it must yield to the Act
Lord Sterndale in Inland Revenue Commissioners vs Gittus said It seems to me there are two principles of rules of interpretation which ought to be applied to the combination of Act and Sched ule
If the Act says that the Schedule is to be used for a certain purpose and the heading of the part of the Schedule in question shows that it is prima facie at any rate devoted to that purpose then you must read the Act and the Schedule as though the Schedule were operating for the purpose and if you can satisfy the language of the section without extending it beyond that purpose you ought to do it
But if in spite of that you find in the language of the Schedule words and terms that go clearly outside that purpose then you must give effect to them and you must not consider them as limited by the heading of that part of the Schedule or by the purpose mentioned in the Act for which the Schedule is prima facie to be used
You cannot refuse to give effect to clear words simply because prima facie they seem to be limited by the heading of the Schedule and the definition of the purpose of the Schedule contained in the Act
 The above observation was not disapproved in appeal However the basic principle is that in case of a conflict between the body of the Act and the Schedule the former prevails
In the instant case we do not find any such conflict
An Explanation as was found in Bihta Marketing Union vs Bank of Bihar   may only explain and may not expand or add to the scope of the original section
In State of Bombay vs United Motors  it was found that an Explana tion could introduce a finction or settle a matter of controversy
Explanation may not be made to operate as exception or proviso
The construction of an Explana tion as was held in Collector of Customs vs G Dass  Co AIR 1966 SC 1577 must depend upon its terms and no theory of its purpose can be entertained 149 unless it is to be inferred from the language used
It was said in Burmah Shell Oil Ltd vs Commercial Tax Officer AIR 1961 SC 3 15  that the explanation was meant to explain the Article and must be interpreted accord ing to its own tenor and it was an error to explain the Explanation with the aid of the Article to which it was annexed
We have to remember what was held in Dattatraya Govind Mahajan vs State of Maharashtra  928   that mere description of a certain provision such as Explanation is not decisive of its true meaning
It is true that the orthodox function of an expla nation is to explain the meaning and effect of the main provision to which it is an explanation and to clear up any doubt or ambiguity in it but ultimately it is the intention of the legislature which is paramount and mere use of a label cannot control or deflect such intention
State of Bombay vs United Motors supra laid down that the inter pretation must obviously depend upon the words used therein but this must be borne in mind that when the provision is capable of two interpretations that should be adopted which fits the description
An explanation is different in nature from a proviso for a proviso excepts excludes or restricts while an explanation explains or clarifies
Such explanation or clarification may be in respect of matters whose meaning is implicit and not explicit in the main section itself
In Hiralal Ratanlal vs State of UP  225 it was ruled that if on a true reading of an Explanation it appears that it has widened the scope of the main section effect be given to legislative intent notwithstanding the fact that the Legislature named that provision as an Expla nation
In all these matters courts have to find out the true intention of the Legislature
In DG Mahajan vs State of Maharashtra supra xx this Court said that legislature has different ways of expressing itself and in the last analysis the words used alone are repository of legislative intent and that if necessary an Explanation must be con strued according to its plain language and not on any a priori consideration 
Applying the above principles we do not find any differ ence between the Schedule and the Explanation I the latter has not amended the Schedule by either deleting item 3i or by adding or including Ayurvedic preparations in item 1
No change of legislative intent is indicated
In the Medicinal and Toilet Preparations Excise Duties Rules 1956 Section C Medicinal and Toilet preparations Allopathic preparations Homoeopathic preparations and Ayurvedic preparations are dealt with separately
So far as Ayurvedic preparations are concerned 150 Rule 64 dealing with types of preparations said Asavas and Aristhas are the principal types of Ayurvedic preparations in which alcoholic content is self generated and not added as such
 Rule 65 on Pharmacopoeia for Ayurvedic prepara tions said Until a standard Ayurvedic pharmacopoeia has been evolved by the Central Government the pharmacopoeias that are in vogue in the various States shall be recognised as standard Ayurvedic pharmacopoeias Rule 66 classified the preparations containing self generated alcohol for purposes of levy of duty
It said No duty shall be levied on Ayurvedic preparations containing self generated alcohol in which the alcohol content does not exceed 2 per cent
Where the percentage of proof spirit is in excess of 2 per cent duty will be leviable under item 2ii or 2i of the Schedule to Act the according as the preparations are capa ble of being consumed as ordinary alcoholic beverage or not Thus Ayurvedic preparations containing self generated alcohol which are not capable of being used as alcoholic beverages fall under original 2i and now 3i
The above Rules which have not been shown to have been amended clearly say that where the percentage of proof spirit is in excess of 2 the preparation would be dutiable under item 2 which became item No 3 in the amended Sched ule
This Rule is consistent with the Schedule but is wholly inconsistent with the Director s circular
Mr Ganguli relies on  Baidyanath Ayurved Bhawan Pvt Ltd vs The Excise Commis sioner of UP The question there was whether medicinal preparation containing tincture spirit etc
was dutiable
The tincture and spirit in their turn contained alcohol
It was contended that alcohol was not directly added but was component of the tincture or spirit
It was however conced ed that the preparations were medicinal preparations and that tincture was a component of that preparation and alco hol was a component of tincture
Therefore this Court held that it was difficult to see how it could be urged that the preparation did not contain alcohol
All that the plain language of the provision required was that the preparation should contain alcohol
The question whether Ayurvedic preparation was a drug to be included in the definition of medicinal preparation was not involved
Whether self gener ated alcohol was to be treated differently was also not there
In Mohanlal Maganlal Bhavsar vs Union of India
it was held that before a medicinal preparation can fall under Item 151 1 of the Schedule three conditions are required to be satis fied A the preparation must be a patent or proprietary medicine 2 it must contain alcohol and 3 it must not be capable of being consumed as an ordinary alcoholic bever age
The fact that ointments and liniments were medicinal preparations containing alcohol in semi liquid form did not make any difference
However it was not in dispute that the articles were medicinal preparations for the purposes of the Act and that they were patent and proprietary medicines
In the instant case the question is whether Ayurvedic prepara tions in view of the definition of medicinal preparations in the Act could be regarded as drugs and could be dutiable under Item 3 and not Item 1
In Commissioner of Sales Tax vs The Modi Sugar Mills Ltd  it was held that a taxing statute must be interpreted in the light of what is clearly expressed therein and nothing can be implied nor can provisions be imported into them so as to supply an assumed deficiency
In Baidyanath Ayurved Bhawan supra this Court quoted the observation of Rowlatt J in Cape Brandy Syndi cate vs Commissioners of Inland Revenue that in a taxing Act one has to look at what is clearly said
There is no room for any intendment
There is no equity about a tax
There is no presumption as to tax
Nothing is to be read in nothing is to be implied
One can only look fairly at the language used
 The question in the instant case however is whether the appellant s product being an Ayurvedic preparation could be a drug for being included in the definition of medicinal preparation for the purpose of the Act
This question was not raised in the above cases
As Mr Dholakia points out the Circular would render item 3i of the Schedule wholly redundant
It has been the consistent policy of legislature to exempt item 3i hither to 2i from duty
The legislature has not in any way changed it
The Explanation has not in any way altered the classification in the Schedule
The substituted Explanation no doubt stressed on patents and trade marks
But it has not expressly envisaged in item I patented trade marked Ayurvedic preparations contrary to the classification in the Schedule
Ex praecedentibus et consequentibus optima fit interpretatio
The best interpretation is made from the context
Injustum est nisi tota lege inspecta de una aliqua ejus particula proposita judicare Vel respondere
It is unjust to decide or respond as to any particular part of a law without examining the whole of the law
Interpretare et concordare leges legibus est optimus interpretendi modus
To interpret and in such a way as to harmonize laws with laws is the best mode of interpretation
In the instant case the Director s Circular is not in harmony with item 3i or with the classifi 152 cation of Ayurvedic preparations in separate item 3
It would not be in conformity with definition of medicinal preparation  in section 2g of the Act
Jura eodern modo dislit uentur quo constitutuntur
Laws are abrogated by the same means authority by which they are made
The Director s Circular is not shown to have been a piece of delegated legislation
The Explanation on its tenor does not amend the Schedule
No part of a Statute is to be taken as superfluous or redundant
Every word in a Statute is to be given a meaning
A construction which would leave without effect any part of the language of a statute will normally be rejected
Every clause of a statute is to be construed with reference to the context and other clauses of the Act so as to make as far as possible a consistent enactment of the whole Statute
The High Court accepted the submission that it provided a selfcontained definition of patent and proprietary medi cines  for the purpose of the main Act and severed the connection between the provisions of the Drugs Act as was contemplated in earlier Explanation I and consequently one need not look to the Drugs Act at all for its interpretation and the Schedule was thence to be interpreted as it existed along with that self containing definition in Explanation I
In doing so the position that Patent and Proprietary medicines means any medicinal preparation which very Medicinal preparation includes all drugs which are a remedy or prescription etc
as defined in section 2g of the Act
So a reference to the Drugs Act was still necessary
No doubt this is an inclusive definition
To enlarge its deno tation a specific provision to include Ayurvedic prepara tions containing selfgenerated alcohol which are not capable of being consumed as ordinary alcoholic beverages was neces sary
That having not been done by the Explanation itself it was not permissible to include it by the Circular
The Explanation I could not have been in conflict with the provisions of the Act and the Circular could not have been in conflict with the Explanation the Schedule the Rules and the Act
In the result we set aside the judgment and decree of the High Court and restore those of the Civil Judge decree ing the suit
We leave the parties to bear their own costs
Y Lal Appeal allowed


Summary:
The Respondent filed proceedings for eviction against the Petitioner firm in respect of a property situated at Narnaul under the Haryana Urban Control of Rent and Evic tion Act 1973 and obtained a decree of eviction
Petition er s appeal against that decree failed in the High Court and the Special Leave Petition filed by it in this Court was also dismissed on 24887
While dismissing the Special Leave Petition this Court inter alia directed that the order of eviction shall not be executed for a period of six months on the Petitioner s filing usual undertaking in this Court within four weeks
Usual under taking implied that the Petitioner was in possession of the property and that it would deliver vacant possession of the property by the time granted to it by the Court
The Petitioner did not file any undertaking in this Court
Instead three of Sanjay Kumar and Lala Ram sons of Rajkumar and Ved Prakash who are sons of Ganpat Ram a partner in the petitioner s firm filed a suit in the Court of senior Sub Judge Narnaul for permanent injunction restraining the decree holders from ejecting Sanjay Kumar  Lala Ram
In the said suit the said plain tiffs obtained an order of temporary injunction dated 311
The said suit was filed against Kalu Ram and Puran Chand son of Roshan Lal and also against Ganpat Rai
The learned Senior Subordinate Judge in his order dated 12288 granting injunction to the plaintiffs took the view that the plaintiffs had claimed a right of tenancy to the premises in question independently and as such the decree of eviction passed by this Court in Special Leave Petition No 5597 of 1987 would not bind the plaintiffs
On this reason ing he issued the injunction
Being unable to obtain possession of the property in question Kalu Ram and Ant
who were respondents in Special Leave Petition decree holders have filed this Petition praying for initiation of Contempt of Court proceedings against the Petitioner firm
224 Disposing of the Petition with some directions this Court HELD On the date of the order of this Court dated 21st August 1987 in the Special Leave Petition the Petitioner therein had obtained time on the implied assurance and representation that they were in possession of the premises in question and were capable of delivering the vacant pos session to the applicants
The effect of the said order of this Court is that the applicants would have vacant posses sion from the firm Ganpat Ram Rajkumar
227C D Having regard to the relationship between the parties and having regard to the undertaking promised to be filed in this Court upon which time was obtained from this Court it appears there is a clear non compliance of the order
227E The said order must be implemented and cannot be allowed to be defeated by the dubious methods adopted by the part ners of the said firm of Ganpat Ram Raj Kumar
The whole conduct betrays a calculated attempt to defeat the order of this Court and to mislead the Court
Sons and grandsons of the partners or erstwhile partners of the firm cannot be allowed to frustrate the order of this Court
227G H 228A The Respondents all of them were guilty of acts which had to the situation and thereby frustrate the order of this Court
Though perhaps the respondents could not be found guilty of violating any undertaking as there was none in the facts and circumstances of the case this Court should ensure compliance with its order dated 24th August 1987 and see that vacant and peaceful possession is given to the applicant in the interest of Justice
229D E Failure to give possession if it amounts to contempt in a situation of this nature is a continuing wrong
There was no scope for application of section 20 of the Act
230B The Court accordingly directed the learned Senior Sub Judge
Narnaul Haryana to cause deliver up the vacant possession of the shop situated at Sabji Mandi Narnaul Distt
Mohindergarh Haryana if necessary with the help of police forthwith
The learned Senior Sub Judge is also di rected to report compliance immediately
Save as aforesaid the Court passed no order on this application
Respondents viz firm Ganpat Ram Rajkumar Ganpat Ram Rajkumar Sanjay Kumar Lalu Ram and Ved Prakash are directed to pay to the applicants the costs of this Application quantified at Rs2500
This order will 225 not prevent or prejudice the applicants from taking any step for recovery of arrears of rent and mesne profits as they are entitled to in accordance with law
230C E Babu Ram Gupta vs Sudhir Bhasin  Anr  and Thackar Hariram Motiram vs Balkrishan Chatrathu Thacker