Birendra Singh v. Excise Commissioner — 1955 DIGILAW 24 (MP)

JUDGMENT : CHATURVEDI, J. 1. This is an application under Art. 226 of the Constitution for a writ in the nature of Mandamus for directing the Excise Commissioner of Madhya Bharat State not to prohibit or debar the petitioner from taking part or from bidding for the excise shops of Muskarat (Intoxicants) and opinion auctioned by the Excise Department and for a declaration that the action of the Excise Commissioner in debarring the applicant orally from bidding at the auction of excise shops at Gwalior and Indore on 19-1-1954 and 17-2-1954, is unconstitutional and illegal. 2. The petitioner has been a license-holder of Excise shops in Gwalior State and continued as such in Madhya Bharat also. It is stated that during the last three years the petitioner was the biggest contractor and the license-holder of the State holding licenses of all the shops of excise for Intoxicants and Opium at Gwalior, Indore, Ujjain and other towns. The petitioner was to stand as a bidder in the auction of the excise shops at Gwalior and Indore on 19-1-1954 and 17-2-1954. It is alleged that the petitioner was debarred orally from bidding in the auction of those shops. He was not given an order in writing nor a copy of the order passed was given to him. The order was of course communicated orally on 19-1-1954 when the auction was to take place at Gwalior. The petitioner submitted an application on 15-5-54 and again one on 29-7-54 through registered post and specifically requested for a copy of the order so that he may seek redress in a court of law. But the Excise Commissioner neither supplied him any copy of the order nor informed the reasons thereof. The petitioner urges that R. 26 of the Rules for Distribution of Shops and Grant of Licenses Samvat 2009 provides clearly that in any case in which a District Excise Officer debars from bidding any person for one or more years the reasons thereof would be clearly stated in the order. The petitioner also stated that he has been debarred from bidding of the licenses in Excise shops without giving him any chance of explanation and that it is against all canons of natural justice and also infringed his fundamental rights. It was added that it is a violation of the rights conferred under Art. 19(g) of the Constitution. The petitioner also stated that he has been debarred from bidding of the licenses in Excise shops without giving him any chance of explanation and that it is against all canons of natural justice and also infringed his fundamental rights. It was added that it is a violation of the rights conferred under Art. 19(g) of the Constitution. He urged that as there was no other efficacious and appropriate remedy he has come to this court under Art. 226 of the Constitution. 3. In reply an affidavit sworn to non-applicant 1 the Excise Commissioner, was filed wherein it is admitted that the petitioner had been a license-holder in the former Gwalior State and also in Madhya Bharat, that he has been the highest bidder for Gwalior Excise shops from 1951-53 and was also the highest bidder for Indore shops in 1953-54. But it is denied that the petitioner performed his duties as a licenee honestly and faithfully or that his record of business remained clean, meritorious and honest. It was stated that there has been serious complaints about his illegal activities and his record of business in Madhya Bharat as well as with the Government of India is not free from taint and tarnish. It is admitted that the petitioner was forbidden to participate in the bidding both at Gwalior and at Indore and the order was communicated to him by the Excise Commissioner himself on the spot. The learned Excise Commissioner further admitted that the copy of the order was not given to the petitioner but in the affidavit no reason is mentioned for not giving a copy of the order. The only thing stated is that the petitioner was duly informed by a letter No. 27176 dated 27-11-54 to the effect that on the basis of information received from the Narcotics Commissioner to the Government of India (regarding his illegal activities) he had been debarred, from participation in the auction of excise shops. This information being of a secret and confidential nature, it was not possible to furnish details to the petitioner. It was further stated that the fact that the petitioner was the highest bidder or previously allowed to participate in the auctions cannot by itself be a reason for permitting the petitioner in future auctions also, if the authorities concerned are satisfied that his activities in the business of intoxicants were not proper. It was further stated that the fact that the petitioner was the highest bidder or previously allowed to participate in the auctions cannot by itself be a reason for permitting the petitioner in future auctions also, if the authorities concerned are satisfied that his activities in the business of intoxicants were not proper. It was denied that the petitioner or that any person has any unfettered right or any fundamental right to carry on trade in respect of articles covered and dealt with by the Excise Act and it was also denied that there was any violation of Art. 19 (1)(g) of the Constitution. It was added that the petitioner had an alternative remedy both under the Excise law and Rules and therefore it was contended that the petitioner being not entitled to the issue of a Writ the petition ought to be dismissed. 4. Now it is well settled by a decision of the Supreme Court that there is no question of the violation of Art. 19(1)(g) and Art. 19(6) of the Constitution as there is no inherent or fundamental right in a citizen to sell intoxicating liquors. It is not a privilege of a citizen. As it is a business attended with danger to the community it can be permitted only under such conditions as will limit to the utmost its evils. The manner and extent of regulation rest in the discretion of the governing authority. Then, mere irregularity committed in conducting any auction sale held under the provisions of the Excise Act cannot be said to have abridged or infringed the petitioner's fundamental rights. Cooverjee B. Bharueha v. Excise Commr. Ajmer, AIR 1954 S.C. 220 (A). 5. Mr. Harihar Niwas Dvivedi places reliance on R. 26 of the Rules made by the Government under S. 68 Excise Act 1952 and from this Rule it appears that the holding of auction sale in respect of vend-licenses of liquor shops is primarily the duty of the Collector of the District. These Rules however have recently been thoroughly discussed by a Division Bench of this Court in Indore in Sunderlal v. State of Madhya Bharat, AIR 1955 Madh. B. 161 (B) which has held that the ultimate power of the Excise Commissioner to supervise and control such auction sales has been saved in these Rules. These Rules however have recently been thoroughly discussed by a Division Bench of this Court in Indore in Sunderlal v. State of Madhya Bharat, AIR 1955 Madh. B. 161 (B) which has held that the ultimate power of the Excise Commissioner to supervise and control such auction sales has been saved in these Rules. It has been further observed that in such auction-sales the ultimate authority to accept the offers or bids is nevertheless the Excise Commissioner and that the position of the Collector is more or less of secondary importance and that the conducting of the auction sale by the Excise Commissioner with the aid of the Collector is not only not illegal but sometimes it is desirable. After going through the Rules I feel it is difficult to differ from the view already taken in this case. Rule 30 which deals with "disposal of contracts by lots" definitely lays down that, subject to the sanction of the Excise Commissioner, the Collector may award the contract without lottery to the bidder whom he considers the most suitable person. Then R. 33 deals with sales requiring sanction of the Excise Commissioner. The last two sentences in this Rule are the following :- "In case of speculative bids R. 30 will apply. This Rule however will not limit the power of the Excise Commissioner to require that the sale of the particular shop or class of shops shall not be confirmed without his previous sanction." It will thus be seen that there are provisions in these Rules to take a view that in important places like Gwalior the presence of the Commissioner at auction sale or his taking a Lading part in the presence of the Collector cannot be held to be illegal or contrary to the Rules for the Distribution of Shops and Grant of Licences, Samvat 2009. It is contended that the Collector ought to have been given unfettered discretion in allowing or not allowing the petitioner to bid at the auction and that if the Collector had allowed him to bid, the Excise Commissioner could have disallowed him if an aggrieved party had filed a regular appeal against the decision of the Collector. It is contended that the Collector ought to have been given unfettered discretion in allowing or not allowing the petitioner to bid at the auction and that if the Collector had allowed him to bid, the Excise Commissioner could have disallowed him if an aggrieved party had filed a regular appeal against the decision of the Collector. Here we have to remember the observations of the Supreme Court in para 17 of A.I.R 1954 SC 592 (c) Guruswami v. State of Mysore that the Excise Commissioner is after all not a court of law whose seisin is dependent upon the filing of a regular appeal. Thus it will be seen that there is no substance in the argument that the Excise Commissioner had no power to disallow the petitioner from bidding at auction sales on 18-1-1954. 6. There is no doubt that the Excise Commissioner's action in debarring orally the applicant from bidding in the auction of Gwalior shops on 18-1-1954 and in not passing the order in writing and then in not giving to the applicant a copy of the order for months together cannot be said to be in the least justifiable. The provisions of appeal embodied in the Rules were thus made nugatory and there was no alternative left for the applicant but to come for a Writ of Mandamus in this Court. Though I do not doubt the accuracy of the statement that the Commissioner for Narcotics has complained against the applicant, still from the affidavit it is not clear whether that letter had been received by the Excise Commissioner before 18-1-1954. If it had been received before the date of auction it is difficult to say what prevented the Excise Commissioner from giving the order in writing debarring the applicant from bidding on the basis of that letter. At least the return filed does not furnish any reasons for not passing any order in writing on the subject for more than eight months. Now the present application for a writ was filed in this Court on 2-11-1954 and the letter No. 27176 from the Excise Commissioner to the applicant was despatched on 22-11-1954. This in itself shows that the letter No. 27176 was prompted more by the writ application than by the spirit for the observance of the Rules framed by the Government or for the principles of natural justice. This in itself shows that the letter No. 27176 was prompted more by the writ application than by the spirit for the observance of the Rules framed by the Government or for the principles of natural justice. To permit what occurred in this case would in all probability leave the door open to the evils which the legislature endeavoured to avoid by enacting the Act and the Government by framing the Rules. 7. So all that can be said is that the Excise Commissioner was a bit high-handed in his official behaviour towards the applicant and did not comply with the Rules framed in that connection, but that would not call for interference by way of writ, specially after the receipt of the letter from the Narcotics Commissioner. The applicant can still make representations to the appropriate authority it he is so disposed to do. 8. I would, therefore, dismiss the application but leave the parties to bear their own costs. 9. DIXIT, J. :- I am also of the opinion that this petition should be dismissed without any order as to costs. The Supreme Court has ruled in A.I.R. 1954 SC 220 (A) that there is no inherent right in a citizen to sell intoxicating liquor by retail, it is not a privilege of a citizen and that the business may be entirely prohibited or be permitted under such conditions as may be prescribed by statute and rules regulating trade in liquor in all its different aspects. That being so, when R. 26(1) of the rules framed under S. 68(2), Madhya Bharat Excise Act for the Distribution of Shops and Grant of Licenses "provides that persons of the type named in the rule shall not be entitled to bid at the auction without the consent of the Collector or the Officer holding the auction, then it is plain that the Collector and the Excise Commissioner acted within their power in debarring the petitioner from bidding at the auction if they honestly believed the petitioner to be of" bad character. Rule 26 does not require that the person intended, to be debarred from bidding should be given an opportunity to show cause why he should not be excluded from bidding at excise auctions. The Excise Commissioner has sworn an affidavit setting out at length the reasons which persuaded him in disallowing the petitioner from participating in the auction sale. Rule 26 does not require that the person intended, to be debarred from bidding should be given an opportunity to show cause why he should not be excluded from bidding at excise auctions. The Excise Commissioner has sworn an affidavit setting out at length the reasons which persuaded him in disallowing the petitioner from participating in the auction sale. From the affidavit it appears that applicant, was prohibited from bidding because of his illegal activities within and outside Madhya Bharat which rendered him unfit to hold any licence. It has not been urged and in view of the statements in the affidavit of the Excise Commissioner it cannot be urged, that the Collector and the Excise Commissioner did not form an honest belief about the fitness of the applicant to hold the license. There is also another ground on which the petition must be rejected. Under R. 32 of the aforesaid rules and R. 1 of the rules regarding Appeals and Revisions, the applicant had the remedy of appealing to the Chief Revenue Authority against the decision of the Excise Commissioner prohibiting him from bidding at the auction. The applicant did not avail himself of this remedy. The contention that the applicant could not appeal because the Excise Commissioner orally debarred him from bidding and did not give him a copy of any written order and that the Excise Commissioner had no power to debar him, is altogether untenable. It has never been held that a decision or an order is appealable only if it has been given or made by the authority empowered in that behalf and that if an authority purports to exercise a power which is not vested in him by law then no appeal or revision lies to the body authorised to hear appeals and revisions from the decisions of such authority. If the applicant had informed the Excise Commissioner that he needed a copy of his order prohibiting him from bidding him at the auction in order to enable him to prefer an appeal to the Chief Revenue Authority, I am certain the Excise Commissioner would have reduced to writing his order and given a copy of the same to the petitioner. Even in the absence of any copy of the order of the Excise Commissioner, the petitioner could have appealed to the Chief Revenue Authority by presenting a petition of appeal and explaining the omission to produce a copy of the order of the Excise Commissioner. Rule 3 of the Rules regarding Appeals and Revisions permitted this course. The applicant having omitted to take advantage of this remedy, is clearly not entitled to invoke Art. 229 for a declaration that he was wrongly debarred from bidding at the auction held in January and February 1954 and for a direction for quashing the order of the Excise Commissioner debarring the applicant from bidding. Application dismissed.