The Legal Principle of “Functus Officio” & Bombay High Court ruling in Alcohol Based Sanitizer classification
The Hon’ble Bombay High Court has brought in the concept of “functus officio”, suggesting that once the legislature has made a decision, it cannot go around issuing press releases or directives to influence how judicial authorities apply it.
Functus officio means “having performed his duty” or “having served its purpose.
Using this principle, the Court has struck down a 2020 press release from the Ministry of Finance, which classified alcohol-based hand sanitizers as “disinfectants” subject to an 18% GST. The DB has held that this press release improperly directed judicial and quasi-judicial bodies, encroaching their independence. The court emphasized that product classification under GST law is an interpretive matter for adjudicatory authorities-not for executive influence.
The case stemmed from a petition by Schulke India Pvt. Ltd., a sanitizer manufacturer, which argued that sanitizers should be classified as “medicaments,” a category subject to a lower GST rate.
Following the press release, the Directorate General of GST Intelligence issued a show-cause notice demanding additional tax from the company. While the High Court did not quash this notice, it clarified that executive instructions cannot influence judicial or quasi-judicial determinations on tax classifications, upholding the separation of powers.
The court reiterated that such executive statements cannot dictate tax rates or classifications, as these responsibilities lie with judicial authorities who must independently interpret the law.
The copy of the order is as under:
