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1999 DIGILAW 1274 (MAD)

Hotel Picnic (P) Ltd. , represented by its Director, Rajendra Gupta and another v. The Special Commissioner and Commissioner of Prohibition and Excise, Chepauk, Chennai and another

1999-11-30

P.SATHASIVAM, R.JAYASIMHA BABU

body1999
Judgment : R. Jayasimha Babu, J. The writ petition of the appellants was directed against the order made by the Commissioner of Prohibition and Excise on 20.9.1999 suspending the F.L.3 licence No.2/82-83. The reasons for suspension were furnished to the petitioners subsequently by the Commissioner on 29. 1999. 2. Theorder of suspension is one against which an appeal lies to the Government under Rule 2 of the Tamil Nadu Prohibition Appeal and Revision Rules, 1983. Rule 2(5) provides that an appeal shall lie to the Government from an original order passed by the Commissioner of Prohibition and Excise and against the original order passed by the Commissioner in the discharge of his functions as a Collector. 3. Since the impugned order has been passed by the Commissioner of Prohibition, that order being an original order, the appellate authority would be the Government. It is stated at the bar that the petitioner in fact has filed an appeal to the Government and that such appeal is pending. It is appropriate that the statutory appellate authority exercise its powers in relation to that appeal and render its decision, without that proceeding being rendered futile by any order of this Court at this stage. It is not the case of the petitioner that the Commissioner has no jurisdiction at all in this matter. The objection is regarding the justification for the exercise of the jurisdiction a matter which can be agitated in the appellate forum. 4. The appellate authority under Rule 4 of the same Rules also has the power to stay the orders under appeal. Rule 4(1) provides that the authorities in whom appellate or revisional powers are vested by these rules, may order stay of operation of the orders appealed against to sought to be revised. It is open to the appellant to move the authority before whom the appeal is pending for stay of the impugned order. 5. It was, however, contended by learned counsel for the appellant that the reasons given for the suspension disclose a wholly erroneous understanding of the Rules. Counsel invited our attention to paragraph 2 of the order dated 29. It is open to the appellant to move the authority before whom the appeal is pending for stay of the impugned order. 5. It was, however, contended by learned counsel for the appellant that the reasons given for the suspension disclose a wholly erroneous understanding of the Rules. Counsel invited our attention to paragraph 2 of the order dated 29. 1999, wherein, it is stated, inter alia, that the flying squad had found 86 persons who were not staying in the hotel (outsiders) were consuming the liquor in the bar (violation of Rule 17(a), Rule 17(b)(iii) read with Rule 35(2) of the Tamil Nadu Liquor (Licence and Permit) Rules, 1981). Counsel contended that a proper reading of those Rules would clearly show that those Rules do not prevent the serving of liquor to persons whom do not stay in the hotel, as the provisions for personal permits which had existed earlier had been deleted, and after such deletion, it was open to any one to avail of the facility of the bar in the hotel, so long as the liquor was consumed inside the bar. The only prohibition, it was submitted, was the one against removing of the liquor in bottles from the the bar for consumption elsewhere, if the person did not stay in the hotel. For those stayed in the hotel, that prohibition did not operate, as the Rules referred to in the order of the Commissioner specifically permits persons staying in the hotel to remove liquor in bottles to the rooms in the hotel where they stay and in which the bar is operated. 6. Counsel invited our attention to Chapter IV of the Tamil Nadu Liquor (Licence and Permit) Rules which deals with Rules relating to the grant of licences. F.L.3 licence being the one relevant in case of star hotel. A “Star Hotel” is defined in Sec.2(xvi) of the Act. The conditions which are required to be satisfied are set out in Sub-clause (a) to (g) thereof. F.L.3 licence being the one relevant in case of star hotel. A “Star Hotel” is defined in Sec.2(xvi) of the Act. The conditions which are required to be satisfied are set out in Sub-clause (a) to (g) thereof. The nature of the licence is briefly described in Rule 17(a)(A) of the Rules in the following terms: “Licence for possession of liquor by Star Hotels for supply to foreign tourists and foreigners resident in India holding personal permits and also citizens of India holding personal permits for consumption within the licensed room of the Hotel or for removal to their private rooms in the same hotel in which they stay for consumption there.” Counsel in this context also invited our attention to Rule 35(2) which occurs in Chapter VI titled “Provisions relating to the working of the licences:.Rule 35, after the amendment, in the year 1997 reads as under: “F.L.3 - Licence for possession of liquor by Star Hotels for supply to foreign tourists foreigners residing in India and also citizens of India for consumption within the licensed room of the hotel or for removal to their private rooms in the same hotel in which they stay for consumption there-- .(1) …….. .(2) Thesale or issue of liquor under the licence may be in pegs to foreign tourists or foreigners resident in India and also to citizens of India for consumption within the licensed room or in sealed bottles for removal of their private rooms in the same hotels in which they stay for consumption there. No liquor other than that sold by the licensee shall be allowed to be consumed within the licensed room. ” This Rule was amended by G.O.Ms.No.216, P. & E. (VIII), dated 17th October, 1997 with effect from 7th March, 1990. 7. Personal permits referred to in the unamended Rules were the personal permits for grant of which provision was made in Chapter III titled Rules Relating to the grant of personal permits”. Those Rules from 7 to 16 were omitted by G.O.Ms.No.216, dated 17th October, 197 with effect from 7th March, 1990. 8. The submission of counsel was that the proper construction of these Rules does not warrant the inference that service of liquor in the bar attached to Star Hotels to citizens of India who do not stay in that hotel is barred. 8. The submission of counsel was that the proper construction of these Rules does not warrant the inference that service of liquor in the bar attached to Star Hotels to citizens of India who do not stay in that hotel is barred. It was submitted that the licence in F.L.3 is given to the Star Hotel as set out in Rule 17(a)(A) and Rule 35 of the Rules for supply to: .• (a) Foreign tourists; .• (b) Foreigners resident in India; .• (c) Citizens of India. The supply to be made to them is to be for (a) consumption within the licensed room or hotel; or (b) for removal to their private rooms in the same hotels in which they stay for consumption there. 9. Rule 35(2) of the Rules, it was pointed out, clarifies this further when it states that the sale of the liquor may be “in pegs to foreign tourists or foreigners resident in India and also to citizens of India for consumption within the licensed room.” The supply in sealed bottles may be made only if it is meant for removal to their private rooms in the same hotel in which they stay for consumption there. The licensee is not to permit anyone to consume within the licensed room liquor which had not been sold by licensee. 10. Counsel pointed out that the decision of the learned single Judge of this Court which has been referred to and relied upon by the learned single Judge who dismissed the appellants writ petition, had only emphasised the fact that a bar in a Star Hotel should not be allowed to be converted into an IMFL shop by permitting the sale of liquor in bottles in such bar in the Star Hotel. It was his submission that, that judgment has been misconstrued by the Commissioner to hold that no service at all is permissible to citizen of India who wishes to consume liquor within the licensed premises in the hotel, unless he stays in the hotel. It was his submission that, that judgment has been misconstrued by the Commissioner to hold that no service at all is permissible to citizen of India who wishes to consume liquor within the licensed premises in the hotel, unless he stays in the hotel. In this context, he invited our attention to the observation in the judgment rendered in the writ petition viz., W.P.No.5360 of 1999, dated 10th May, 1999: “Hence, it is impermissible for a licensee to sell liquor in sealed bottles to outsides and if such a practice is allowed, then there would be no difference between the IMFL shop and a bar room in a Star Hotel. The above condition has been incorporated in the licence to maintain the vital distinction between a bar and an IMFL shop and an unrestricted sale of IMFL bottles in a bar would make no difference between a bar and an IMFL shop. That apart, the condition is imposed on the ground of public policy to the effect that a bar should remain as a bar and a retail liquor shop should remain as a retail liquor shop should remain as a retail liquor shop and it is not possible to combine both in one place. As a matter of fact, there is a prohibition against a liquor shop to have a bar attached to it and conversely a bar cannot be converted into a liquor shop by unrestricted sale of liquor in sealed bottles not only to the residents but also to outsides who throng the bar for getting supply of liquor. Since the petitioner has admitted the said violation of the condition, I have to hold that the finding of the first respondent on the violation of the said condition is based on materials on record and it is impermissible for the petitioner to run the bar as an IMFL retail shop.” 11. Counsel pointed out that what was in issue in that writ petition was the validity of action taken by the authority against a licensee holding a F.L.3 licence who had sold liquor in bottles to persons who did not stay in the hotel, and what had been held by the learned Judge in that case was that public policy as also the Rules made a clear distinction between the bar in any Star Hotel and an IMFL shop. 12. 12. Counsel pointed out that in this case, there is no allegation that liquor had been sold in bottles to anyone who did not stay in the hotel. All that the appellant is charged with was that it had served liquor to persons who did not stay in the hotel, but, who consumed liquor so served, within the premises of the hotel in the licensed room. 13. Such service within the licensed room, of liquor sold by the licensee for consumption within the licensed room, it was submitted, was not prohibited by any of the Rules on which the Commissioner has sought to rely. 14. Though we find considerable merit in these submissions, we cannot adjudicate that matter here, as it is open to the petitioner to advance these arguments before the appellate authority before which it has filed the appeal. 15. We have no doubt that the appellate authority will bestow due consideration to these submissions, and make its final order on a proper construction of the provisions of the Rules, and the conditions of the licence. It will no doubt, consider the effect of the removal of the requirement for personal permits while considering the question. We make it clear that any observations made by the learned single Judge in the impugned judgment, or in W.P.No.5360 of 1999 decided on 10th May, 1999 which run counter to the submissions which the learned counsel has made before us regarding the interpretation of the Rules will not be treated as binding on the appellate authority. The appellate authority shall be free to adopt the construction which it considers proper with regard to the service of liquor to citizens who avail the services of the bar in a Star Hotel, and to whom the liquor is not supplied in bottles. Submit to these observations, the appeal is dismissed. No costs. Consequently, C.M.P.No.18947 of 1999 is dismissed. 16. The learned Government Pleader fairly states that the appellate authority will dispose of the appeal within a period of two weeks from today.