On Wednesday, a nine-judge Constitution Bench of the Supreme Court, in an 8:1 majority, held that states have the power to regulate denatured spirits or industrial alcohol. This decision arose from a case concerning the interpretation of the term “intoxicating liquor” under Entry 8 of List II (State List) of the Seventh Schedule of the Constitution. The Key issue was whether the term included industrial alcohol, which is primarily used for manufacturing purposes rather than human consumption.
The majority opinion, penned by Chief Justice DY Chandrachud, reasoned that "intoxicating liquor" should not be narrowly defined to include only consumable alcohol. Instead, it should cover liquids containing alcohol that could potentially be misused for consumption, noting that the term “intoxicating” can also mean poisonous. The judgment stressed the public interest element of Entry 8, which empowers states to regulate various stages of production, transportation, and sale of alcoholic substances, even if they are not traditionally associated with drinking.
The bench further emphasized that the regulation of industrial alcohol serves a larger public interest by preventing its misuse, reflecting the constitutional framework that grants states the authority to safeguard public health. The ruling also acknowledges the state’s role in controlling the entire lifecycle of alcoholic substances, including industrial alcohol, under the term “intoxicating liquor”. By extending the definition, the judgment strengthens the regulatory power of states to manage not only potable alcohol but all alcoholic liquids that could pose risks to society.
In contrast, the dissenting opinion by Justice Nagarathna took a more restrictive view. She argued that industrial alcohol, which is specifically manufactured for industrial purposes and not for human consumption, should not be included in the definition of “intoxicating liquor”. According to her, expanding the definition undermines the original intent of the Constitution and unnecessarily stretches the state's legislative powers over industrial products. This narrower interpretation, she contended, is crucial to maintaining the division of powers between the state and the union, especially when central laws already regulate industrial alcohol.
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