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2007 DIGILAW 733 (AP)

A. Subbarami Reddy v. Superintendent, Prohibition & Excise, Tirupathi

2007-08-03

V.ESWARAIAH

body2007
Judgment :- Common Order: Heard learned counsel appearing for the petitioners as well as the learned Government Pleaders for Prohibition & Excise; and Home appearing for the respondents. 2. In all these Writ Petitions similar contentions have been raised and by different impugned orders, dated 23-07-2007, the licences of the petitioners have been suspended pending enquiry. These Writ Petitions have been filed questioning the said suspension orders passed by the 1st respondent-Superintendent, Prohibition & Excise and to declare the said orders as illegal, against the principles of natural justice, and violative of the judgments of this Court. 3. Petitioner in W.P.No.16637 of 2007 is the licencee of M/s Raghava Wines shop No.3 situated at Durgasamudram village, Tirupathi Rural mandal; petitioner in W.P.No.16638 of 2007 is the licencee of M/s Raghava Wines shop No.4 of Pudipatla village, Tirupathi rural mandal; and the petitioner in W.P.No.16642 of 2007 is the licencee of M/s Raghava Wines shop No.5 at Pudipatla village in different house numbers. Though all the shops are named ‘M/s Raghava Wines’ but the licecees are different. All the aforesaid three licences have been suspended pending enquiry by the impugned order, dated 23-07-2007, for the following reasons: “It is stated that on 22-07-2007 on reliable information the Excise officials (raid party) visited the house of one N. Pitchireddy located at Udyoganagar of Tirupathi rural mandal and found four accused namely 1) J. Ravindrakumar Reddy 2) B. Ravibabu 3) Mula Kumar and 4) K. Sudhakar and detected thirtytwo cans each with 35 lts of spurious liquor, two cartons each 48 bottles of 180 ml (total 96 bottles) of spurious liquor, one sealing machine, one cork threading machine, five plastic trays, plastic tub, 4380 corks, four bundles of brand labels, gum bottles, two sheets of EALs in the house and six cartons each with 48 bottles of 180 ml (total 268 bottles ) of spurious liquor in Maruthi Zipsi which was kept in front of the house. A4-K. Sudhakar was the driver of the said Maruthi Zipsy. A4-K. Sudhakar was the driver of the said Maruthi Zipsy. It is stated that on interrogation A1-J. Ravindrakumar Reddy informed the Excise officials that the said spurious liquor is being supplied through Raghavareddy to the said shop and accordingly the raid party also raided the said M/s Raghava Wines shop Nos.3, 4 and 5, interrogated the Cashiers of the said shops who were found selling the liquor and they stated that as per the instructions of their owner they are selling the spurious liquor bottles and on search they have detected three cartons of spurious liquor. On the confessions/ statements of the Cashiers, who stated that as per the instructions of the owner, they have been keeping the spurious liquor in the back side of the shop and selling by taking advantage of the situation and based on the confessional statement of the accused-driver of the said J. Ravindrakumar Reddy, who is said to have been connected with the owner of the liquor shops, the three shops licences have been suspended, pending enquiry on the ground that there is a link between the illicit manufacturers of the spurious liquor and the petitioners as admitted/confessed by their cashiers/naukars which amounts to serious violation of licence conditions and also as per sub-Rule 4 of Rule 17 of the A.P. Excise (Lease of Right of Selling by Shop and Conditions of Licence) Rules, 2005 (for brevity ‘the Rules’), which says: “Every act of the authorized agent or servant shall be deemed to be an act of the lease holder”. 4. In view of the aforesaid prima facie case; in view of the breach of the conditions of the licence, and also as the sale of liquor is injurious to public health and also loss to the Government Exchequer, licences have been suspended pending enquiry. 5. Learned counsel appearing for the petitioners submits that as per Proviso to Section 31(1) of the A.P. Excise Act, 1968 (for brevity, ‘the Act’) no licence permit shall be cancelled or suspended unless the holder thereof is given an opportunity of making his representation against the proposed action. 5. Learned counsel appearing for the petitioners submits that as per Proviso to Section 31(1) of the A.P. Excise Act, 1968 (for brevity, ‘the Act’) no licence permit shall be cancelled or suspended unless the holder thereof is given an opportunity of making his representation against the proposed action. In support of his contention he relied on a judgment of this Court in GOKA BUJJAMMA v. PROHIBITION AND EXCISE SUPERINTENDENT, SRIKAKULAM AND OTHERS (2003 (2) ALT 549 (D.B.) wherein the Division Bench of this Court relying on the judgment of another Division Bench in K. SRINIVASA REDDY v. SUPERINTENDENT, PROHIBITION AND EXCISE ( 2002 (1) ALT 108 (D.B.) held that as per the Proviso to Section 31(1) of the Act no licence permit shall be cancelled or suspended unless the holder thereof is given an opportunity of making his representation against the proposed action. 6. It is further stated that a learned single Judge of this Court in VENKATESWARA WINES, JANNEPALLY VILLAGE NAVIPET MANDAL, NIZAMABAD v. SUPERINTENDENT OF PROHIBITION & EXCISE, NIZAMABAD DISTRICT AND OTHERS ( 2004 (4) ALD 681 ) relying on the aforesaid judgments held that a perusal of the Proviso to Section 31(1)(e) of the Act goes to show that no licence or permit shall be cancelled or suspended unless the licence holder is given an opportunity to give his representation against the action proposed. Accordingly, the suspension order was set aside keeping it open for the authority to issue show cause notice to the petitioner to proceed with the enquiry in accordance with law. 7. I am of the opinion that in none of the aforesaid judgments, the judgment of the Full Bench in TAPPERS CO-OPERATIVE SOCIETY, MADDUR v. SUPERINTENDENT OF EXCISE, MAHABOOBNAGAR (1984 (2) APLJ 1) was referred or considered. The Full Bench of this Court while considering the similar Proviso to Section 31(1)(e) of the Act existing at that time also held in paragraph No.44 that: “The power of suspension which is concomitant or adjunct is no doubt restricted by the statutory provision under the Proviso in question to pass final orders of suspension but that power cannot be said to have been taken away to pass an interim order of suspension not intended to be penalty but only interim measure to pass effective orders”………………… 8. The Apex Court in M/S SUKHWINDER PAL BIPAN KUMAR AND OTHERS ETC., v. STATE OF PUNJAB AND OTHERS (1982 S.C. 65) held that the power of suspension is a necessary concomitant power to grant a privilege or a licence and the power of suspension is a necessary adjunct of the power to grant a licence. In view of the judgment of Full Bench of this Court (4 supra); judgment of the Apex Court (5 supra); that the licencing authority can suspend the licence pending enquiry, I am of the view that these judgments have to be followed. However, certain observations have been made holding that the power to suspend the licence is an incidental or ancillary power but it cannot be exercised in a routine way or as the matter of course if it is possible to give an opportunity to the licencee and the circumstances do not warrant such a drastic step, the licencing authority is bound to afford an opportunity and the power of suspension pending enquiry should not be exercised as an invariable rule or mode of making an enquiry. Further the suspension pending enquiry should not be allowed to continue for an unduly long period. The authorities are bound to conclude the enquiry as earlier as possible and any undue delay, when it constitutes abuse of power, makes the order liable to be set aside. Whether the suspension of licence must be preceded by a notice or opportunity must depend upon various factors such as, degree of urgency involved, the duration of suspension, the nature of the breach, public danger to be avoided, and other similar circumstances which warrant an immediate action where it is not feasible or possible or even advisable to give an opportunity to the holders of the licences before passing interim orders of suspension. Accordingly, the Full Bench held that the licencing authority has got ancillary and incidental powers of suspending a licence or permit pending enquiry in a given case if the circumstances clearly warrant and taking into account the urgency in the case. 9. Accordingly, the Full Bench held that the licencing authority has got ancillary and incidental powers of suspending a licence or permit pending enquiry in a given case if the circumstances clearly warrant and taking into account the urgency in the case. 9. Therefore, I am of the opinion that the contention of the learned counsel appearing for the petitioners, that as per the aforesaid two judgments of the Division Bench and the judgment of the learned single Judge the licence cannot be suspended pending enquiry, cannot be accepted in view of the authoritative judgment of the Full Bench of this court. Insofar as the cases on hand are concerned, the panchanama recorded by the Excise officials goes to show that the accused have been manufacturing the spurious liquor and even supplied to the petitioners’ shops as confessed by their Naukarinama holders and Cashiers and in fact, they have also raided the shops of the petitioners and the link has been established. If the said allegations are true, I am of the opinion that the violations are serious in nature as the sale of spurious liquor is injurious to public health apart from loss of huge revenue to the Exchequer. However, I am of the opinion that the petitioners are not entitled to the relief prayed for in these Writ Petitions. There is an alternative remedy also available to them under section 63 of the Act. On this ground also these writ petitions cannot be entertained. 10. In view of the aforesaid facts and circumstances I am not inclined to interfere with the aforesaid suspension orders made pending enquiry as there are valid reasons warranting to suspend the licences and in view of the fact that sale of the spurious liquor is injurious to public health apart from the loss of Government Exchequer. I do not see any grounds to interfere with the said suspension orders pending enquiry. 11. Accordingly, Writ Petitions are dismissed. However, 1st respondent is directed to conduct an enquiry by issuing show cause notices and pass appropriate final orders as expeditiously as possible without any undue delay within four weeks from the date of receipt of a copy of this order. No order as to costs.