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2003 DIGILAW 12 (ALL)

GAVENDRA PAL SINGH v. COMMISSIONER, U. P. EXCISE

2003-01-06

M.KATJU, YATINDRA SINGH

body2003
M. KATJU, J. ( 1 ) THIS writ petition has been filed for a mandamus directing the respondents not to compel the petitioners to lift the minimum guaranteed quantity of the country liquor from the month of december, 2002 to 31. 3. 2003 and to charge licence fee only on the amount of quantity which is lifted for sale by the petitioners for these months. ( 2 ) WE have heard learned counsel for the parties. ( 3 ) THE petitioners are licensees for retail sale of country liquor under the U. P. Excise (Settlement of Licences for Retail Sale of Country Liquor) Rules, 2002, in district Aligarh. Copies of their licences have been annexed as Annexure-1 to the writ petition. These licences have been granted for the period from 1. 4. 2002 to 31. 3. 2003. ( 4 ) IN paragraph 12 of the writ petition the petitioners have given various reasons for not lifting the minimum guaranteed quantity of country liquor. It is alleged in paragraphs 13 and 14 of the writ petition that the fixation of minimum guaranteed quantity and the licence fee for the same is arbitrary and illegal. ( 5 ) THE respondents have filed a counter-affidavit. In paragraph 3 (B) of the same it is mentioned that in pursuance of the advertisement dated 18. 3. 2002, for settlement of retail country liquor shops in district Aligarh, the petitioners voluntarily made offers with their eyes wide open and well looking into the terms and conditions of the licence and minimum guaranteed quantity, etc. and their offers were accepted by the respondents resulting in a concluded contract. The petitioners started running the shops in question in terms of the licence/contract but now they want to withdraw from their contractual obligations. ( 6 ) IN paragraph 3 (C) of the counter-affidavit, it is stated that the annual minimum guaranteed quantity is defined as the quantity of country liquor as fixed by the licensing authority in accordance with the general or specific instructions issued by the Excise Commissioner and guaranteed by the licensee to be lifted by him for his retail shop during an excise year for the purpose of retail sale. In paragraph 3 (D) of the counter-affidavit it is stated that the minimum guaranteed quantity as fixed by the Excise Commissioner has been taken to be the basis for calculation of the licence fee which is the consideration for parting with the exclusive privilege in favour of the petitioners. ( 7 ) THE respondents have relied on the decisions of the Supreme Court in State of Orissa and Ors. v. Narain Prasad, (1996) 5 SCC 740 . They have also relied on the decision in State of U. P. v. Sheopat Rai, 1994 Supp (1) SCC 8, where it was held that the licence fee or fixed fee cannot partake the character of either regulatory fee or compensatory fee. In paragraph 5 of the counter-affidavit it is stated that the minimum, guaranteed quantity has been fixed by the Excise commissioner on the basis of the report submitted by the Excise Authorities concerned in response to the letter dated 15. 2. 2002. A copy of the said letter has been annexed as annexure-C. A. 1 to the counter-affidavit. It is stated that the Excise Commissioner, U. P. . has got power under Section 41 (c) for prescribing the scale of fee or manner of fixing the fee payable for any licence, permit or pass including any consideration for the grant of any exclusive or other privilege. ( 8 ) LEARNED counsel for the petitioners have relied on the Supreme Court decisions in Bimal chandra Banerjee v. State of Madhya Pradesh, AIR 1971 SC 517 and Excise Commissioner, U. P. , Allahabad v. Ram Kumar etc. , AIR 1976 SC 2237 , It was held in these decisions that even if the minimum quantity of liquor has not been lifted, no excise duty can be charged and the legal provisions which permits it would be invalid. However, these decisions have been considered and distinguished by the Supreme Court in State of Orissa and Ors. v. Narain Prasad and Ors. (supra ). However, these decisions have been considered and distinguished by the Supreme Court in State of Orissa and Ors. v. Narain Prasad and Ors. (supra ). ( 9 ) IN paragraph 19 of the aforesaid decision it was held that in Bimal Chandra Banerjees case (supra) ; Ram Kumars case (supra), the decision approached the question from the point of view of levy of excise duty, but no argument appears to have been put forward that the State is merely seeking to recover the consideration for the grant of exclusive privilege/licence as per the terms and conditions of, and asundertaken in the agreement. In paragraph 33 of the same decision, it was observed ; "a review of the decided cases of this Court on the subject indicates a clear shift in the way this matter has been looked at. Initially, the matter was looked at from the point of view of the levy of excise duty. But then a different view point emerged with the Constitution Bench decision in hari Shankar v. Dy. Excise Commissioner, AIR 1975 SC 1121 , which was carried forward in panna Lal v. State of Rajasthan, AIR 1975 SC 2008 , and other decisions which approached the matter from the point of view of grant of privilege. " ( 10 ) IN Solomon Antony and Ors. v. State of Kerala and Ors. , JT 2001 (3) SC 100, a similar view was taken by the Supreme Court and it was held that the kist amounts have to be paid by the contractors as the contractors with their eyes wide open have accepted the terms of payment of consideration of the kist. ( 11 ) THE petitioners voluntarily entered into the contract after knowing about the terms and conditions and hence they cannot now challenge the same, as held in Hari Shankers case (supra ). ( 12 ) THERE is no merit in this petition and it is dismissed. Interim order if any is vacated. .