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1968 DIGILAW 63 (GAU)

J. N. Bardhan v. Union Territory of Manipur

1968-09-04

C.JAGANNADHACHARYULU

body1968
ORDER This is a petition filed under Article 226 of the Constitution of India by one J. N. Bardhan of Paona Bazar Road, Imphal, against (i) the Union Territory of Manipur, (ii) Chief Commissioner of Manipur and (iii) the Secretary (Finance) to the Government of Manipur for quashing the order of cancellation of the petitioners licence for running a restaurant "with bar attached" on Paona Bazar Road, Imphal. 2. The petitioner is the proprietor of a guest house, a hotel and restaurant on Paona Bazar Road, Imphal. He applied on 15-5-1964 to the Minister (Finance), Government of Manipur, through the Finance Secretary, Government of Manipur for a licence to sell whisky, rum, gin etc. of Indian make by peg system in his guest house hotel under the Eastern Bengal and Assam Excise Act (Act I of 1910), (hereafter called as the Act) which was made applicable to the Union Territory of Manipur and under the Manipur Excise Rules of 1962 (hereinafter called as the Rules) framed under the Act by the second respondent. Vide Ext. B/1 which is a true copy of his application. Thereafter, the Inspector of Excise, Manipur, sent a letter (Ext. A/1) dated 25-9-1964 to the petitioner asking him to let him know whether he was running a hotel or a restaurant and to which the petitioner would attach the bar. The petitioner replied to the Inspector of Excise on the same date, as can be seen from Ext. A/2 that he was running a hotel and a restaurant but that he would close the hotel and keep the restaurant with bar attached, the moment the licence was issued to him. After enquiry, the Collector of Excise, Manipur, issued a licence (of which Ext. A/3 is a true copy) dated 7-10-1964 with certain conditions. Exhibit A/3 reads that the petitioner was permitted by the Excise Collector of Manipur to use the restaurant with bar attached for sale of potable foreign liquor to be sold by glass only and to be served and consumed within the premises of the bar. Certain other conditions were also imposed. 3. The petitioner ran the restaurant from 7-10-1964 under the name and style of "Guest House Bar Restaurant" in Paona Bazar, Imphal. The licence was to expire on 31-3-1965. He deposited Rs. 100,00NP. in the Treasury in Manipur for renewal of licence till 31-3-1966 (Vide Exts. A/4 and B/3). Certain other conditions were also imposed. 3. The petitioner ran the restaurant from 7-10-1964 under the name and style of "Guest House Bar Restaurant" in Paona Bazar, Imphal. The licence was to expire on 31-3-1965. He deposited Rs. 100,00NP. in the Treasury in Manipur for renewal of licence till 31-3-1966 (Vide Exts. A/4 and B/3). In the meanwhile, the then Finance Secretary Shri S. Subramaniam, cancelled the licence by his order dated 25-3-1965 (as per Ext. A/5) on the ground that the petitioner opened a separate bar and restaurant in another building, far away from the guest house contrary to the terms of the licence and against the policy of the Government in the gradual enforcement of prohibition and that the petitioner also contravened the terms of the licence by purchasing liquor from dealers outside the Union Territory instead of purchasing it from the local dealers. The rum and other items were all seized under Ext. A/6 dated 6-4-1965 by an Excise Officer. The petitioner made representation to the Government to rescind the order of cancellation. The Under Secretary to the Government of Manipur sent Ext. A/7 (letter) to the petitioner dated 5-5-1965 that the Government refused to reconsider its decision to cancel the licence. The respondents adjusted the surcharge and sale fee etc. from the sum of Rs. 100 deposited by the petitioner towards renewal of the licence. The petitioner sent a demand notice (Vide Ext. A/8) dated 26-6-1965. The Finance Department sent a letter Ext. A/9 dated 15-7-1965 stating that the matter was under consideration and that the final reply would follow. But, as no further reply was given, the petitioner filed the present writ petition on 13-10-1965, questioning the authority of the Finance Secretary to cancel the licence and the authority of the Government in adjusting the amount of Rs. 100,00 nP. deposited by the petitioner towards the dues due to the Government. 4. But, as no further reply was given, the petitioner filed the present writ petition on 13-10-1965, questioning the authority of the Finance Secretary to cancel the licence and the authority of the Government in adjusting the amount of Rs. 100,00 nP. deposited by the petitioner towards the dues due to the Government. 4. The respondents filed counter alleging that the licence, issued to the petitioner, authorised him to sell potable foreign liquor by glass to the boarders of the guest house within the premises of the building standing on plot No. 286/211, Paona Bazar, Imphal, in which the petitioner was running a restaurant under Municipal Licence No. 81, but that instead of complying with the said condition the petitioner opened bar in another building on a different plot in Paona Bazar, Imphal, which was about 220 yards away from his guest house where he was running his boarding and that the petitioner also imported foreign liquor from outside Manipur in breach of the terms and the conditions of licence. The respondents further alleged that according to the notification as per Ext. B/2 dated 11-5-1962, the second respondent Chief Commissioner, Manipur was declared to be the "Board" under the Act, that the Government of Manipur as the "Board" came to know about the breach of the terms and the conditions of the licence and that therefore the Board cancelled the licence under its orders in Ext. A/5. The respondents also allege that a sum of Rs. 80.50 nP. was due from the petitioner towards surcharge and sale fee etc., that the respondents adjusted the amount and requested the petitioner to take refund of the balance money but that the petitioner refused to accept the adjustment (vide Ext. B/4) and that, therefore, the stock was seized by the Sub-Inspector of Excise on 6-4-1965. The respondents contend that the cancellation of the licence was legal and that the writ petition is not maintainable. 5. Section 3 of the Act contains the definitions. Sub-section (2) of Section 3 defines "Board" as the Provincial Government of Assam which means the Administration of Manipur in the case of Union Territory of Manipur according to the Rules. Sub-section (8) of Section 3 defines "Excise Commissioner" as the Officer appointed by the Provincial Government under Section 8 subsection (2) Clause (a) of the Act. 6. Sub-section (2) of Section 3 defines "Board" as the Provincial Government of Assam which means the Administration of Manipur in the case of Union Territory of Manipur according to the Rules. Sub-section (8) of Section 3 defines "Excise Commissioner" as the Officer appointed by the Provincial Government under Section 8 subsection (2) Clause (a) of the Act. 6. Exhibit B/2 (notification) dated 11-5-1962 reads that the second respondent Chief Commissioner appointed the Deputy Commissioner of Manipur as the Excise Commissioner within the meaning of Section 3 (8) of the Act and that the Chief Commissioner would continue to be the "Board" for the purposes of the Act. 7. It is common ground that the Collector of Excise, Manipur (Deputy Commissioner) was authorised to issue the licence to the petitioner as per Ext. A/3. Though the respondents counsel stated that the licence was itself illegally granted, they admitted in para 2 of their counter that the Collector of Excise, Manipur issused the licence in the exercise of power conferred on him under the Act, as extended to the erstwhile State of Manipur under Council Resolution No. 23 dated 25-8-1948. So, the validity of the licence cannot now be questioned by the respondents. 8. But, the respondents allege that the petitioner committed breach of the terms of the licence. Firstly, they allege that the petitioner ran the bar in another building on a different plot in Paona Bazar, Imphal, instead of in the guest house building on plot No. 286/211, for which he obtained Municipal Licence No. 81 and that the said building was about 220 yards away from the guest house where the petitioner was running his boarding and where he agreed to run the bar also. The respondents also allege that the petitioner imported foreign liquor from outside Manipur in breach of the conditions of Ext. A/3. The petitioner filed an affidavit in reply. But, he did not specifically deny these allegations of the respondents. He simply stated that the allegations of the respondents, which are inconsistent with the facts mentioned by him in his petition, were denied. In the present writ petition disputed questions of fact cannot be traversed. The Court has to proceed on the footing that he committed breach of the conditions of Ext. A/3. 9. Then the next question is who was competent to cancel the licence. In the present writ petition disputed questions of fact cannot be traversed. The Court has to proceed on the footing that he committed breach of the conditions of Ext. A/3. 9. Then the next question is who was competent to cancel the licence. Exhibit A/5 shows that the then Finance Secretary cancelled the licence. But, Section 29 of the Act lays down that, subject to such restrictions as the Provincial Government may prescribe the authority who granted any licence, permit or pass under the Act may cancel or suspend the same for the grounds mentioned therein. In the present case the authority, who granted the licence, was the Excise Collector (Deputy Commissioner). The Finance Secretary had nothing to do with the licence. So, he had no authority to cancel the licence. The learned Government Advocate, however, argued that the Finance Secretary cancelled the licence under the direction of the second respondent "Board", as can be seen from Ext. A/5 letter of cancellation itself, wherein the Finance Secretary stated that he was directed to issue the letter of cancellation. But, even the "Board" has no authority suo motu under the Act or the Rules to cancel the licence. Section 9 of the Act shows that orders passed under the Act or under the Rules shall be appealable as prescribed by the Rules to the District Collector, if any order was passed by a Collector other than the District Collector, to the Excise Commissioner if any order was passed by the District Collector and to the Board if any order was passed by the Excise Commissioner or by a Commissioner of a Division. No doubt, under Section 9 (4) of the Act, the Board may call for the proceedings held by any officer or person subordinate to it and pass such orders thereon as it may think fit. But, in the present case no order was passed by the Excise Collector. The learned Government Advocate was not able to point out any provision in the Act or the Rules under which the Board can suo motu cancel the licence issued by the Collector. So, the order of cancellation of the licence is illegal. 10. Then the next question is whether the petitioner is entitled to renewal of the licence. The learned Government Advocate was not able to point out any provision in the Act or the Rules under which the Board can suo motu cancel the licence issued by the Collector. So, the order of cancellation of the licence is illegal. 10. Then the next question is whether the petitioner is entitled to renewal of the licence. But, under section 32 of the Act, no person to whom a licence has been granted under the Act shall have any claim to the renewal of the licence, or, save as is provided in Section 30, to lay claim for compensation. So, the petitioner is not entitled as a matter of right to claim that the licence should be renewed in his favour. The respondents learned counsel contended that, in view of Section 30 of the Act, no writ petition lies and relied on Mahammad Hanif v. State of Assam, AIR 1961 Assam 20 in support of his contention. In that case the State Government as lessor of certain land, resumed it in terms of the lease. It was held that the State Government stood on the same footing as any private lessor and that the High Court could not interfere with the rights of the two individuals, even though those rights related to property. The decision in Ghaio Mal and Sons v. State of Delhi, AIR 1959 SC 65 is more direct to the point. In that case the right of a licensee to get his licence in form L-2 renewed under Delhi Liquor Licence Rules of 1935 was considered. It was held that the usual practice was that, once a licence in Form L-2 is granted by the Chief Commissioner, it was almost automatically renewed by the Collector from year to year, unless, of course, the licensee was found guilty of breach of any excise rule and that in such a case of renewal there was no vacancy entitling any outside competitor to apply for a licence in Form L-2, that if in case it was held that the order granting the licence was a nullity on account of its not having been made by the competent authority, the vacancy caused by the closure of business would still remain to be filled up and that the appellants in the case would have a chance of having their application considered by the competent authority. But, in the present case, as the petitioner committed breach of some of the conditions of the licence, the Court cannot hold that he is entitled to get his licence renewed. At any rate, under Section 82 of the Act, he is not entitled to claim as a matter of right that his licence should be renewed in his favour. This is a matter purely in the discretion of the respondents and the Court cannot compel them to exercise their discretion in favour of the petitioner. The writ will be infructuous. 11. In the result, the petition fails and is accordingly dismissed, but, under the circumstances, without costs. Petition dismissed.