In Brief
Pernod Ricard, a foreign liquor sub-licensee, exceeded permissible loss limits during license year 2009-10. Rule 19 then imposed penalties at four times maximum duty. In 2011, Rule 19 was substituted to impose penalties at duty payable only. Eight months later, demand notices were issued applying the old Rule. The Supreme Court held that when subordinate legislation is repealed and substituted, the new rule applies to all pending proceedings initiated after substitution, regardless of when the violation occurred. The reduced penalty reflects a deliberate policy choice for better regulation, and Section 31 of the Madhya Pradesh General Clauses Act does not extend the old rule to pending cases. The Court allowed the appeals and directed penalty determination under the substituted Rule 19.
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