Judgment ( 1. ) PETITIONER is a liquor contractor. A liquor auction was conducted in the month of March, 2005 which ended in favour of the petitioner on account of having quoted maximum bid. Accordingly, he was granted four licences for country liquor shops and one licence for foreign liquor shop for the year 2006-07. As per paragraph-5. 3 of the writ petition, W. P. No. 7670/06 containing challenge to the legality and validity of Clause 8 (2) of the Liquor Policy of the year 2006-07 is still pending. Petitioner deposited the basic licence fee and the annual licence fee for the complete year of 2006-07. His grievance is that despite the realization of money in the aforesaid manner, supply of country liquor as well as foreign liquor was not made by the respondents to the petitioner to enable the latter to sell it in exercise of his right under the licence. Since, the contractual period of 2006-07 is over, the petitioner has claimed refund of his unutilized money deposited as annual licence fee with interest. ( 2. ) IN the matter of liquor contract three terminologies frequently come across. They are (i) annual auction amount (ii) basic licence fee (iii) annual licence fee. Annual auction amount means the bid received for a group of shops put to auction whereby open auction or tender system for any period is accepted and confirmed by the Collector or the Excise Commissioner as the case may be. The term annual auction amount is also known as annual price. This has been so defined in the general licence conditions. The basic licence fee is worked out at a particular percentage of annual price of the shop. Percentage is decided by the State government for a particular year while deciding the policy for the year. For the relevant period 2006-07, percentage was fixed at 8%, meaning thereby that 8% of the annual price was the basic licence fee. Amount of basic licence fee deducted from the annual price would make out the annual licence fee against which supply of liquor is made. For the relevant period 2006-07, percentage was fixed at 8%, meaning thereby that 8% of the annual price was the basic licence fee. Amount of basic licence fee deducted from the annual price would make out the annual licence fee against which supply of liquor is made. Equationally it may be said :-Annual price/annual auction amount - basic licence fee - annual licence fee thus, a licencee of liquor (i. e. auction purchaser) is liable to pay annual price of a shop for which licence is granted to him in terms of basic licence fee as well as annual licence fee. No adjustment or supply is liable to be made against the basic licence fee whereas supply of liquor is liable to be made against the annual licence fee if the same is deposited in due manner within the prescribed period. Basic licence fee and annual licence fee are explained in clause 2. 3. 6 of the Liquor Policy of the year 2006-07 contained in Annexure/r-1. ( 3. ) ADMITTEDLY, the petitioner being the highest bidder in the liquor auction, was granted licence for four country liquor shops and one foreign liquor shop. Vide licence cumulatively marked as Annexure/p-4,he was required to make deposit in each quarter in the proportion mentioned in the licence. Clause-8 of the Liquor policy (Annexure/r-1) provides for procedure of deposit of licence fee. Accordingly, the annual licence fee was liable to be realized in 24 fortnightly instalments. Under clause-8. 4 of the Liquor Policy, if the licencee fails to deposit the instalment of licence fee or part thereof in the relevant fortnight and deposits the same in the next fortnight, he would not be entitled to issue of liquor to him against the delayed deposit of licence fee. If the licencee fails to deposit the balance licence fee even in the succeeding fortnight, the licence granted to him was liable to be revoked after expiry of such succeeding fortnight. Further, the excise Department was empowered to make an alternate arrangement for running such liquor shop. ( 4. ) PETITIONER has admittedly failed to deposit the licence fee in respect of the shops within the period prescribed for him. On account of such failure, a notice dated 22. 1. 2007 (Annexure/r-4) was issued to the petitioner proposing thereby that the balance licence fee may be lastly deposited through challan by 22. 1. 2007. ( 4. ) PETITIONER has admittedly failed to deposit the licence fee in respect of the shops within the period prescribed for him. On account of such failure, a notice dated 22. 1. 2007 (Annexure/r-4) was issued to the petitioner proposing thereby that the balance licence fee may be lastly deposited through challan by 22. 1. 2007. It was made clear that in case of failure to make deposit, his licence may be cancelled or may be revoked in exercise of powers under Section 31 of Madhya pradesh Excise Act and the shops may be handed over for running them under an alternative arrangement. Petitioner vide his application dated 22. 1. 2007 (Annexure/r-5) submitted that the balance fees may be recovered by invoking the Bank Guarantee submitted by him. The present writ petition was submitted during the validity period of the liquor contract and on 7. 3. 2007 an interim order was made by this Court that if the petitioner is not in arrears of any instalment or dues except interest, the respondent No. 1 shall permit the petitioner to lift the liquor as per the terms of contract. In the reply, it was stated that the Bank guarantee was already invoked before passing of the order dated 7. 3. 2007 and the entire amount of annual price with respect to all the shops was recovered from the bank. It is further stated that pursuant to the order dated 7. 3. 2007 supply of liquor was made to the extent of fortnightly deposits which were received by the invocation of the Bank Guarantee in the relevant fortnights. ( 5. ) SHRI S. R. Dhurve, Assistant Excise Commissioner, Damoh and Shri M. K. Jain, Deputy Excise Commissioner, Jabalpur Division were kept present by the learned Govt. Advocate with departmental record. They made a statement on the basis of their official record that the defaults were committed with respect to the following fortnights :- Country liquor Shop No. Period of default 1. Novembsr,2006 to january,2007 2. October II Fortnight to february 1 Fortnight. 3. Regular deposit. 4. July,06 to December,06 I fortnight. Foreign Liquor Shop 5. October, 06 to January,07. It is stated at Bar by Shri Dhurve, Assistant Excise Commissioner, Damoh that the supply of liquor was made against the money received from the bank through invocation of Bank Guarantee. ( 6. October II Fortnight to february 1 Fortnight. 3. Regular deposit. 4. July,06 to December,06 I fortnight. Foreign Liquor Shop 5. October, 06 to January,07. It is stated at Bar by Shri Dhurve, Assistant Excise Commissioner, Damoh that the supply of liquor was made against the money received from the bank through invocation of Bank Guarantee. ( 6. ) IN view of the aforesaid and further on account of expiry of the relevant period April, 2006 to March, 2007, the petitioner claimed for the refund of money deposited by him through Bank Guarantee against which no liquor was supplied and the writ petition survives merely to this extent. ( 7. ) SHRI N. S. Kale, learned Sr. Advocate and Shri Alok Pathak, learned Govt. Advocate made their respective contentions which have been considered in the light of the material on record and the legal provisions governing the situation. ( 8. ) SHRI N. S. Kale, learned Sr. Advocate contended that the amount of annual licence fee against which no liquor is supplied, is liable to be refunded in view of the terms and conditions of the contract as well as Excise Act, rules made thereunder and the Liquor Policy of the year 2006-07. Respondents are not empowered to forfeit such amount under any of the clauses. Reliance has been placed on the division Bench decision of this Court dated 17. 1. 2006 in W. P. No. 9310/2005 (Lalit jaggi Vs. State of M. P. and others ). ( 9. ) PER contra Shri Alok Pathak, learned Govt. Advocate, it has been contended that the decision in Lalit Jaggis case is based on the Liquor Policy of the year 2005- 06 whereas the present case arises out of the liquor contract of the year 2006- 07 which is governed by different terms and conditions. Since, the petitioner has committed defaults in making fortnightly payment of the licence fee in a regular manner, the amount irrespective of non-supply of liquor stood forfeited and the claim of the petitioner for its refund is not liable to be accepted. ( 10. ) MATTER is to be examined from the terms and conditions of the liquor contract including liquor licence, rules under the Madhya Pradesh Excise Act, 1915, General licence Conditions and the Liquor Policy of the year 2006-07. ( 10. ) MATTER is to be examined from the terms and conditions of the liquor contract including liquor licence, rules under the Madhya Pradesh Excise Act, 1915, General licence Conditions and the Liquor Policy of the year 2006-07. Madhya Pradesh excise Act, 1915 has been enacted to consolidate and amend the law in Madhya pradesh relating to the import, export, transport, manufacture, sale and possession of intoxicating liquor and intoxicating drugs. Chapter-V of the Act provides for duty on excisable articles. Chapter-VI provides for issuance of licence, permit or pass. There is no dispute in the present case with regard to the power of the state Government to charge fees for issuance of liquor licence. Similarly, there is no dispute with regard to power of the Government to issue/cancel, suspend or withdraw the licence. In view of the nature of the controversy involved herein, it is unnecessary to embark upon the provisions of M. P. Excise Act, 1915 except observing that there is no express and specific provision in the Act empowering the State Government to forfeit the amount of annual licence fee. ( 11. ) SIMILARLY, no rule under the M. P. Excise Act, 1915 has been pointed out in specific conferring a power on the State Government to forfeit the annual licence fee or part thereof in case of delayed deposits. Further, there is no clause in general Licence Conditions that the amount of annual licence fee or part thereof would stand automatically forfeited in case it is deposited after the expiry of the period prescribed therefor. ( 12. ) LIQUOR Policy of the year 2006-07 is on record as Annexure/r-1. Clause 2. 3. 6 provides that basic licence fee is fixed at 8% of the annual price and the annual licence fee would be worked out after deducting the basic licence fee from the annual price. Clause-8 of Annexure/r-1 provides for the procedure of deposit of licence fee which being relevant is reproduced below :-( 13. ) MUCH emphasis has been put on Clause-8. 4 which lays down if the licencee fails to deposit the prescribed fortnightly instalment fully or partly in the same fortnight and instead deposits it in the succeeding fortnight, he would not be entitled to the supply of liquor against such belatedly deposited licence fee. ) MUCH emphasis has been put on Clause-8. 4 which lays down if the licencee fails to deposit the prescribed fortnightly instalment fully or partly in the same fortnight and instead deposits it in the succeeding fortnight, he would not be entitled to the supply of liquor against such belatedly deposited licence fee. It has been further laid down that in case, if, the balance licence fee is not deposited before expiry of the succeeding fortnight, his licence may be revoked after expiry of the succeeding fortnight and the necessary alternate arrangement may be made. Clause-8. 4 thus, disqualified a licencee from seeking supply of liquor against the licence fee which is not deposited in the relevant fortnight. This would merely mean that the licencee, though, deposits the balance licence fee in a belated manner cannot compel the Excise Department to issue liquor against such deposit and the excise Department is under no obligation to make supply of the liquor against such deposit. It nowhere contemplates that the amount of deposit against which liquor is not supplied would stand forfeited. It may be further seen from the remaining clause that in case of further default, the licence granted to the licencee is liable to be revoked. Thus, the power of the Excise Department is streamlined in as much as firstly the Excise Department did not carry any obligation to supply the liquor against the delayed deposit of balance licence fee. Secondly, in case of default of making deposit of balance licence fee in the relevant and succeeding fortnight, the licence could have been rightly and lawfully cancelled. Obviously, this power of cancellation has not been exercised at all. On the contrary, the amount of entire licence fee for the year 2006-07 has been recovered from the department by invoking the Bank Guarantee. ( 14. ) IT would be equally relevant to consider clause-3 of the Liquor Policy (Annexure/r-1) which provides for forfeiture of earnest money, basic licence fee and security amount. Basic licence fee has already been fixed at 8% of the annual price. Beyond it, it would be annual licence fee as per clause-2. 3. 6 of Annexure/ r-1. ( 14. ) IT would be equally relevant to consider clause-3 of the Liquor Policy (Annexure/r-1) which provides for forfeiture of earnest money, basic licence fee and security amount. Basic licence fee has already been fixed at 8% of the annual price. Beyond it, it would be annual licence fee as per clause-2. 3. 6 of Annexure/ r-1. Had there been intention of the Department to provide for forfeiture of annual licence fee, a proper provision could have been made in clause-3 which by no stretch of imagination deals in any manner with the forfeiture of annual licence fee. Forfeiture of money deposited with the State Government has stringent consequences and the same cannot be permitted without any express and enabling provision. ( 15. ) IN the case of Lalit Jaggi (supra), the liquor contractor defaulted during april - July, 2005 in depositing the full amount of instalment in time and against the amount deposited lifted liquor and started selling the same in the shop in question. He was served with a show cause notice that why action should not be taken against him on account of failure to deposit the instalment due up to 30th June, 2005. Assistant Commissioner of Excise issued a direction to the Warehouse In-charge for not making supply of liquor to the petitioner. Considering clause-13 of the Liquor Policy of the year 2005-06, this Court observed :- "we have considered the aforesaid submissions of Mr. Tankha and Mr. Yadav and we find that sub-clause (3) of Clause 13 of the liquor Policy for the year 2005-06 provides that in case the licencee fails to deposit any instalment of licence fee before the expiry of next instalment due, then his licence is liable to be cancelled and an alternative arrangement can be made to operate the concerned liquor shop. The said provision in sub-clause (3) of Clause 13 of the Liquor Policy for the year 2005-06 does not say that whenever the licencee fails to deposit the licence fee before the expiry of next instalment due, the licence of the licencee shall be cancelled or will stand automatically cancelled. It only confers a right on the Excise Department to cancel the licence of licencee if he fails to deposit the instalment of licence fee before the expiry of the next instalment due. It only confers a right on the Excise Department to cancel the licence of licencee if he fails to deposit the instalment of licence fee before the expiry of the next instalment due. Where, therefore, the default is made by the licencee in not making the deposit of instalment of licenpe before the expiry of next instalment due, the Department may or may not exercise such right to cancel the licence and in the event, it does not exercise such right and accepts the deposit of instalment of licence fee beyond the stipulated time, liquor will have to be supplied to the licencee against the instalment of licence fee deposited and accepted beyond the stipulated time. Obviously, the Department cannot on the one hand accept and appropriate the licence fee paid by the licencee beyond the stipulated time and thereafter refuse to supply the liquor to the licencee against the instalment of licence fee deposited and appropriated after the due date. In Bimal Chandra Banerjees case ( AIR 1971 SC 517 ) and in Parmalals case ( AIR 1975 SC 2008 ), the Supreme court has held that no excise duty is or can be collected on as undrawn liquor. The said decisions of the Supreme Court have been relied on in State of MP. vs. Firm Cappulal (supra) cited by Mr. Tankha wherein the Supreme Court has, interpreting the provisions of the M. P. Excise Act, 1915 held that the State could not levy excise duty on undrawn liquor as the State does not possets such powers. 6. On a reading of the impugned circular dated 9. 9. 2005, we find that all that the Excise Commissioner has stated therein is that in some of the district, licence fee was being collected beyond the time as stipulated in Clause 13 of the Liquor Policy for the year 2005-06. In the said circular, the Excise Commissioner Bis nowhere stated that even if the Excise Department has accepted the instalment of licence fee beyond the stipulated time, the Excise department will not make any supply of stocks of liquor against such deposits of instalment of licence fee beyond the stipulated time. In the said circular, the Excise Commissioner Bis nowhere stated that even if the Excise Department has accepted the instalment of licence fee beyond the stipulated time, the Excise department will not make any supply of stocks of liquor against such deposits of instalment of licence fee beyond the stipulated time. To us, it appears that the Excise Commissioner has directed the district authorities to be strict in implementing the Clause 13 of the Liquor Policy of the year 2005-06 by ensuring that the licence fee is deposited within the stipulated time as provided m sub-clause (3) of Clause 13 of the Liquor Policy for the year 2005-06. 7. For the aforesaid reasons, we hold that sub-clauses (3) and (4) of Clause 13 of the Liquor Policy for the year 2005-06, or that the circular dated 9. 8. 2005 of the Excise Commissioner, are ultra-vires Section 25 of the Excise Act or Article 14 of the Constitution. But, as we have said above, if the Excise authorities accept the licence fee beyond the stipulated time as mentioned in sub-clause (3) of Clause 13 of the Liquor Policy for the year 2005-06, they will be obliged to supply stocks of liquor against such deposit of licence fee beyond the stipulated time. If they refuse to accept the instalment of licence fee beyond the stipulated time as mentioned in sub-clause (3) of Clause 13 of the Liquor Policy for the year 2005-06, they will be entitled to cancel the licence of the licencee and make alternative arrangement in respect of the concerned liquor shop. " ( 16. ) SHRI Alok Pathak, learned Govt. Advocate contended that Lalit Jaggis decision (supra) is based on the Liquor Policy of the year 2005-06. Copy of the same has been made available by the learned Govt. Advocate which has been kept on record. Relevant clause-13. 3 is reproduced below for making a convenient comparison with clause 8. 4 of Annexure/r-1. ( 17. ) A perusal of both the clauses makes it clear that the earlier clause did not disqualify the licencee to lift the liquor even against the delayed deposit of annual licence fee whereas clause 8. 4 of the relevant policy did disqualify the petitioner from demanding supply of liquor. On account of insertion of the clause of disqualification, the petitioner does not get substantial assistance from the Lalit jaggis decision. 4 of the relevant policy did disqualify the petitioner from demanding supply of liquor. On account of insertion of the clause of disqualification, the petitioner does not get substantial assistance from the Lalit jaggis decision. Present case relates to the right/power of the State Government to forfeit the money deposited by or recovered from the petitioner against the defaulted instalment of annual licence fee. Its forfeiture can be permitted only if the State Government is empowered by virtue of any empowering provision. ( 18. ) THE word "forfeiture" was firstly dealt with by the Honble Supreme Court of India long before in its decision in the case of Bankura Municipality Vs. Lalji raja and Sons ( AIR 1953 SC 248 ). It was held :- "according to the dictionary meaning of the word forfeiture the loss or the deprivation of goods has got to be in consequence of a crime, offence or breach of engagement or has to be by way of penalty of the transgression or a punishment for an offence. Unless the loss or deprivation of the goods is by way of a penalty or punishment for a crime, offence or breach of engagement it would not come within the definition of forfeiture. " The word forfeiture has been defined in the Blacks Law Dictionary as :- "a deprivation or destruction of a right in consequence of the nonperformance of some obligation or condition. Loss of some right or property as a penalty for some illegal act. Loss of property or money because of breach of a legal obligation (e. g. default in payment ). " There was again an occasion before the Apex Court to consider the word forfeiture in the case of R. S. Joshi Vs. Apt Mills ( AIR 1977 SC 2279 ). It has been observed :- "coming to forfeiture, what is the true character of a forfeiture ? It is punitive in infliction, or merely another form of exaction of money by one from another ? If it is penal, it falls within implied powers. If it is an act of mere transference of money from the dealer to the State, then it falls outside the legislative entry. Such is the essence of the decisions which we will presently consider. There was a contention that the expression forfeiture did not denote a penalty. If it is penal, it falls within implied powers. If it is an act of mere transference of money from the dealer to the State, then it falls outside the legislative entry. Such is the essence of the decisions which we will presently consider. There was a contention that the expression forfeiture did not denote a penalty. This, perhaps, may have to be decided in the specific setting of a statute. But, speaking generally, arid having in mind the object of Section 37 read with S, 46, we are inclined to the view that forfeiture has a punitive impact. Blacks Legal Dictionary states that to forfeit is to lose, or lose the right to, by some error, fault, offence or crime, to incur a penalty. forfeiture, as judicially annotated, is a punishment annexed by law to some illegal act or negligence. . . . . . . . , something imposed as a punishment for an offence or delinquency. The word, in this sense is frequently associated withthe word penalty*. " Hpwever, it cannot be lost sight of that neither in the Excise Laws (Act and rules) nor in the Liquor Policy of the year 2006-07 the word forfeiture has been used. On the contrary, it has been specifically provided that if the licencee makes a default in making payment of instalment of annual licence fee, his licence may be revoked/cancelled. Thus, in the absence of specific provision for forfeiture, it cannot be held that forfeiture of the delayed payment of instalments of annual licence fee was even contemplated. Only power which vested in the Excise department was to decline to issue liquor against such delayed payment and further to revoke/cancel the liquor licence. Nothing more may be read in the Policy. ( 19. ) EVEN under the provisions of Indian Contract Act, 1872, no-one is entitled to retain the benefit without performing a contract or without having stipulation to that effect. ( 20. ) EXCISE Officers present in the Court gave the following figures from their record :-Country liquor annual price basic licence fee annual licence fee amount against shop No. (in Rs.) (in Rs.) (in Rs.) which liquor was supplied (in Rs.) 1. 28644500/- 2291600/- 26352900/- 17570821/-2. 4786600/- 383000/-4403600/- 3241212/-3. 2328500/- 186300/- 2142200/- 2242196/- * 4. 18213200/- 1457100/- 16756100/- 11663231/-Foreign liquor shop No. 5. 28644500/- 2291600/- 26352900/- 17570821/-2. 4786600/- 383000/-4403600/- 3241212/-3. 2328500/- 186300/- 2142200/- 2242196/- * 4. 18213200/- 1457100/- 16756100/- 11663231/-Foreign liquor shop No. 5. 13126100/- 1050100/- 12076000/- 4806834/- * Note :- It has been informed by the learned Asstt. Excise Commissioner in the Court that the amount in excess of annual licence fee was deposited in cash by the petitioner. ( 21. ) IN view of the aforesaid, tentatively it seems that an amount of Rs. 22306502/-of the petitioner was with the Excise Department against which liquor is not stated to have been supplied. Such money could have been forfeited only in the light of any empowering legal or contractual provision. No such provision could have been pointed out by the learned Govt. Advocate. Therefore, the amount of the petitioner lying with the respondents against which liquor was not supplied is found hereby liable to be refunded and the petitioner is held entitled to it. ( 22. ) SHRI Kale, learned senior counsel made a request that interest at the Bank rate 14. 25% per annum may be awarded on the amount of refund which has been vehemently opposed by Shri Alok Pathak, learned Govt. Advocate. It may be seen from the various terms and conditions of liquor laws or liquor contracts that the petitioner was not liable to pay interest on the defaulted amount. It is equally true that there is no statutory provision providing interest to the petitioner in case of refund. This being so, respondents cannot be straightway directed to pay interest on the amount of refund. ( 23. ) IN the result, the writ petition succeeds in part. Petitioners are held entitled to the refund of the amount of annual licence fee against which liquor has not been supplied to the petitioner by the respondents. Respondents are therefore, commanded to refund the amount within two months from today. In case of failure, the petitioner would be entitled to interest at the rate charged from him while submitting Bank Guarantee to the respondents. No order as to costs. Petition succeeds in part.