W. M. MENDIS AND CO., LTD. v. COMMISSIONER-GENERAL OF EXCISE

039-SLLR-SLLR-2002-3-W.-M.-MENDIS-AND-CO.-LTD.-v.-COMMISSIONER-GENERAL-OF-EXCISE.pdf


CA W. M. Mendis and Co., Ltd. v. Commissioner-General of Excise 305
W. M. MENDIS AND CO., LTD.
V.
COMMISSIONER-GENERAL OF EXCISE
COURT OF APPEALTILAKAWARDANE, J.
CA NO. 757/98MARCH 25, 2002
Excise Ordinance, No. 8 of 1912, sections 21 and 31 – Due compliance withregulations – Is there a public duty envisaged under section 217 – Public dutiescast on Commissioner-General of Excise – Outdated legislation/regulations.
The petitioner sought a writ of mandamus directing the respondent to takenecessary steps to ensure that a label containing the term “Old Arrack” or a similarname with reference to age, the age of the arrack to be stated in years. It wascontended that in terms of section 21 of the regulation, if the label contains anywords indicating age, the age shall be stated in years, and shall be that of theyoungest liquor in this kind.
Held :
Section 21 (F) imposes a public duty on the 1st respondent to takenecessary steps to ensure compliance with the essential requirements laiddown therein. The word used in the applicable rules is “shall” which meansit is clear that the rules were imposed as mandatory requirements.
When legislation or a regulation passed by the legislature becomesoutdated it is the duty of the legislature to amend such outdated legislationto suit the requirements of the present time.
Per Tllakawardane, J.
“There is an urgent need to amend the relevant regulations and it is thetask that should be accomplished through the legislature.”
APPLICATION for a writ in the nature of mandamus.
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Cases referred to:
Weligama Multi-Purpose Co-operative Society v. Chandradasa Daluwatte- (1984) 1 Sri LR 195 at 199.
Tanson v. Driefontein Consolidated Mines Ltd. – (1902) AC 484 500.
Romesh de Silva, PC, with Hiran de Alwis for petitioner.
Sathya Hettige, Deputy Solicitor-General with Mahen Gopallawa, State Counselfor Attorney-General.
Cur. adv. vuit.
December 13, 2002
SHIRANEE TILAKAWARDANE, J.
Petitioner has filed this application seeking a writ of mandamusdirecting the respondent to take necessary steps to ensure that alabel containing the term 'Old Arrack’ or a similar name with referenceto age, the age of Arrack to be stated in years and shall be of theyoungest liquor in the blend.
Petitioner is admittedly a limited liability Company and is engagedin the business of manufacturing and distributing liquor.
The petitioner’s case was that by virtue of Gazette notification dated13.11.1936, an Excise notification No. 305, marked (XI) was publishedcontaining regulations in terms of the Excise Ordinance, No. 8 of 1912.In terms of section 21 of the said regulation, “if the label containsany words indicating age, the age shall be stated in years, and shallbe that of the youngest liquor in the blend”. The averment of thepetitioner was that although this is a mandatory requirement severalmanufacturers and distributors of Old Arrack had not complied with thesaid requirement. So the gravamen of the argument of the petitionerwas that despite several communications made to the Commissioner-
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General of Excise, the respondent, no action was taken to see thatdue compliance with the said regulation was carried out. The cruxof the matter is whether the said regulation requires mandatory compli- 20ance and if so whether the respondent has failed in his statutory dutyto take steps to enforce the said regulation.
The averments of the respondent was that no public duty wasenvisaged by section 21 of the said regulation, so as to be enforcedby a writ of mandamus. Counsel for the respondent has cited theauthority Weligama Multi-Purpose Co-operative Society Ltd. v.Chandradasa Daluwatta at 199 where Sharvananda, J. statedthat “Mandamus lies to secure the performance of a public duty,in the performance of which an applicant has sufficient legalinterest. To be enforceable by mandamus the duty to be performed 30must be of a public nature and not of merely private character”.
The first issue to be considered is whether there is a public dutycast upon the respondent by section 21 (F) of the said ExciseNotification No. 305. The second issue is whether the petitioner hassufficient legal interest to enforce such public duty. Respondent hascontended that the words used in the said section 21 (F) is merelydirectory and it is not mandatory as alleged by the petitioner. Oneimportant fact that has to be kept in mind is that when interpretinga statute or a regulation made in pursuance of the powers vestedby a statute, it is unwise to consider a provision in isolation and 40a provision must necessarily be interpreted after considering all theother provisions and the purpose of a statute or a regulation. TheExcise Notification No. 305 was issued under the powers vested bysection 31 of the Excise Ordinance, No. 8 of 1912.
On a perusal of the said regulation it is clear that it was introducedwith the intention of controlling and regulating the manufacture anddistribution of liquor. The word used in the applicable rules is “shall”which makes it clear that the rules were imposed as mandatoryrequirements.
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The first word used in the heading of section 21 is “essential”particulars in a label. The only conclusion that can be drawn isthat section 21 (F) imposes a public duty on the 1st respondentto take necessary steps to ensure compliance with the “essential"requirements laid down therein. The respondent has contended thaton the basis of R1, a label dated 1996 of the petitioner’s productthat the petitioner itself has not adhered to rule 21 (F). It was alsocontended that the petitioner had repeatedly flouted the provisions ofExcise Notification No. 832.
What is significant is that the mere fact the petitioner flouted theExcise regulations and that the respondent has not taken action meansthat the respondent has failed to carry out its duties and does nottaint this application of the petitioner nor the respondent’s powers todeal with such contravention of the regulations by the petitioneraccordingly. The respondent cannot on that basis justify its failure tocarry out the public duty of being vigilant to the compliance of theseExcise regulations.
The next important contention raised, relates to the disastrous anddestabilizing effects that would have on the entire liquor manufacturingindustry if the relief claimed by the petitioner is to be granted. Besides,very unfavourable consequences like the petitioner having a monopolyand the small scale manufacturers being swept aside from the market,the respondent points out that such relief granted would causesubstantial loss of revenue in excise duties to the State.
What must be noted here is that when a legislation or regulationpassed by the legislature becomes outdated, it is the duty of thelegislature to amend such outdated legislation to suit the requirementsof the present time.
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It is a well-accepted rule of interpretation that where a statutoryprovision is clear and unambiguous, the words should be interpretedaccordingly.
Therefore, there is an urgent need to amend the relevantregulation as also being pointed out by the respondent and it is thetask that should be accomplished through the legislature.
As Wade on Constitutional and Administrative Law, 10th edition,page 59 states the classification of the powers of governmentinto legislative, executive and judicial powers involves manyconceptual difficulties and within a system of government based onlaw, it remains important to distinguish its constitutional structurebetween the primary functions of law making, law executing and lawadjudicating. If these distinctions are abandoned, the concept oflaw itself can scaresly survive.
Craies on Statute Law, 7th edition, page 176 cites Lord Daveyin Tanson v. Driefontein Consolidated Mines Ltd.™ where he states“public policy is always an unsafe and treacherous ground for judicialdecision, and its application is difficult if not mischievous”. Also quotesBurroughs, J. in Fauntieroy’s case where it is said that public policy“is a restive horse and when you get astride on it, there is no knowingwhere it will carry you”.
On the basis of these authorities and also on the basis of thefacts discussed by the respondent wherein he has establishedthat there is a need to change the regulation embodied in ExciseNotification No. 305, it becomes clear that it is a task which isentrusted to the legislature.
However, in applying the law as it is, where anything on the labelwhich connotes age, like “Old Arrack”, it is mandatory for the respon-
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dent to seek compliance with the regulation referred to above. Thisstates that where words indicate age, the age shall be specified andshall be of the youngest liquor in the blend. The word old has a specificreference to age, as the older the liquor, stronger is the ultimateproduct. Not to do so, could mislead the consumer. Therefore, thisCourt issues a writ of mandamus directing the respondent to takenecessary steps to ensure that a label containing the terms “oldarrack”, or a similar term which refers or connotes to the age of thearrack, its age should be stated in years and such specification shallbe of the youngest liquor in the blend. Application allowed with costs.
Application allowed.
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