Judgment :- The petitioner has challenged the Memo dated 212. 1996, of the Divisional Excise Officer, Periyakulam, Theni District, third respondent herein. 2. Facts leading to the Writ Petition are as follows: Pursuant to a notification for sale of Arrack shops in Theni Town of Periakulam Taluk for the Excise year 1983-84, the petitioner submitted a tender, in respect of the Shop No.3 (Arrack Shop No.34) on 16.07.1983. The tender amount quoted by the petitioner was Rs.34,200/- . As the amount offered was below the upset price, the auction was not confirmed immediately. Nearly after 2½ months, orders confirming sale of Arrack Shop No.34 was issued in favour of the petitioner and the same was received by him on 110. 1983. Since the sale was not confirmed immediately, the petitioner decided to seek for refund of the amount and sent a petition dated 110. 1983 seeking for refund. Instead of refunding the amount, the respondents 1 to 3, brought the shop for reauction and that the same was confirmed in favour of one Mr.Veerannan. Subsequently, the tender amount remitted by the petitioner was refunded. On an erroneous presumption that the petitioner had caused revenue loss to the Government to the tune of Rs.1,27,765/- on account of non-acceptance of the tender, a memo, dated 23.07.2006 was issued to the petitioner, after a lapse of 13 years, in which, the Divisional Excise Officer, Periyakulam, Theni District, third respondent, has stated that the write off proposals submitted by the Excise Officials were not accepted by the Government and therefore, the petitioner has to remit a notional loss of Rs.1,25,765/-. On receipt of the memo, the petitioner requested a months time to submit his reply. Rejecting the same, the third respondent issued another memo, dated 212. 1996, calling upon the petitioner to remit the notional loss. The Tahsildar, Thodupuzha, Kerala State, fourth respondent, has issued an order, threatening to take revenue recovery proceedings. Aggrieved by the rejection and the memo, dated 212. 1996 of the third respondent, the petitioner has preferred the present Writ Petition to quash the same. 3. 1996, calling upon the petitioner to remit the notional loss. The Tahsildar, Thodupuzha, Kerala State, fourth respondent, has issued an order, threatening to take revenue recovery proceedings. Aggrieved by the rejection and the memo, dated 212. 1996 of the third respondent, the petitioner has preferred the present Writ Petition to quash the same. 3. Relying on Rule 7 of the Tamil Nadu Toddy and Arrack Shop (Disposal in Auction) Rules, 1981, Mr.M.Murali, learned counsel for the petitioner submitted that the tender, once admitted shall not be withdrawn before the expiry of 60 days from the date of receipt of the tender or until the shop is finally sold in auction, whichever is the earliest. He further submitted that the petitioner offered the sale amount of Rs.34,200/- on 16.07.1983 and it was accepted on 010. 1983 and that the acceptance order was received by the writ petitioner only on 110. 1993. He submitted that the rule permits withdrawal from tender, after sixty days from the date of receipt of tender and therefore, the petitioner by letter dated 110. 1983, intimated the authorities that he is not willing to run the shop, on the ground that the confirmation was made after 60 days, and that he cannot mulcted with any liability to make good the notional loss caused due to the delay on the part of the respondents in confirming the sale. 4. Learned counsel for the petitioner further submitted that the very object of Rule 7 is that Excise Officials cannot take their own sweet time in confirming an auction and cause prejudice to the tenderer, if the sale is not confirmed within the said period. According to him, on the expiry of 60 days, the respondents cannot fix any liability on the auctioner/tenderer. 5. Learned counsel for the petitioner further submitted that the very fact that the write off proposals were submitted to the Government shows that the respondents, in order to extricate themselves from the delay in confirming the tender, have submitted proposals and therefore, the petitioner cannot be held responsible for the notional loss. 6. Inviting the attention of this Court, to the difference in the quantum of notional loss, alleged to have been caused by the writ petitioner in the two memorandums, dated 23.07.1996 and 212. 6. Inviting the attention of this Court, to the difference in the quantum of notional loss, alleged to have been caused by the writ petitioner in the two memorandums, dated 23.07.1996 and 212. 1996, respectively, learned counsel for the petitioner submitted that the assessment has not been done properly and that the variation in the quantum only reflects non-application of mind. He further submitted that the shop was brought for sale during 1983-84 and in the second auction, it was confirmed in favour of one Mr.Veerannan. After a period of 13 years, the third respondent has issued a demand for Rs.1,29,8635. No reasons have been assigned for the inordinate delay in issuing the demand and for the abovesaid reasons, he prayed that the impugned order is liable to be quashed. 7. Reiterating the averments made in the counter affidavit filed by the Additional Secretary to Government, Prohibition and Excise Department, Secretariat, Chennai, Mr.S.Geetha, learned Additional Government Pleader submitted that the auction sale of Arrack Shop No.34/83-84 was notified on 02.06.1983 for the Excise year 1983-84, for the period from 16.07.1983 to 15.07.1984. Since there was no bid on the notified dates, the auction sale was adjourned to 14.06.1983 and subsequently, on 24.06.1983. Even thereafter, the sale was once again adjourned to 16.07.1983. Out of the two individuals, who participated in the sale , the tender offered by the writ petitioner was accepted. Agreeing to abide by the rules and regulations relating to the conduct of Arrack shop auction, the petitioner remitted Rs.17,500/-, being the advance half month rental on 21.07.1983 and Rs.8,000/- towards 1/5th Security Deposit on the same day. He also paid Rs.1,000/- Earnest Money Deposit. The bid amount of Rs.34,200/- furnished by the petitioner was lower than the upset price of Rs.38,515/- fixed and notified to the above said shop. 8. Learned Additional Government Pleader further submitted that as the bid amount was lower than the upset price, a necessity arose to obtain the concurrence of the higher authority to confirm the sale in favour of the tenderer for an amount lower than the upset price notified for the said shop. The Commissioner of Prohibition and Excise, Chennai, agreed to confirm the sale for Rs.37,200/- and accordingly, the confirmation order was issued by the District Collector, Madurai on 010. 1983. The said order was served on the petitioner on 110. 1983. The Commissioner of Prohibition and Excise, Chennai, agreed to confirm the sale for Rs.37,200/- and accordingly, the confirmation order was issued by the District Collector, Madurai on 010. 1983. The said order was served on the petitioner on 110. 1983. A memo was also issued to the writ petitioner on the same day, directing him to remit 2½ months rental for a shop and to apply for licence. 9. Learned Additional Government Pleader further submitted that instead of applying for licence, after remitting 2½ months rental, the petitioner sent a petition, dated 110. 1983, which was received in the Office on 011. 1983. In his petition, dated 110. 1983, the petitioner informed the respondents that he is not willing to conduct the Arrack shop, as the sale was confirmed after the expiry of 60 days from the date of furnishing the tender. As the petitioner has refused to conduct the shop, the District Collector, Madurai, by his telegram, dated 111. 1983, directed the shop for resale. Accordingly, re-sale was conducted on 211. 1983 by the Assistant Collector, Periyakulam and that the sale was knocked down for Rs.30,100/- by one Mr.Veeranan and that the same was confirmed, vide proceedings of the District Collector, dated 112. 1983. 10. Learned Additional Government Pleader further submitted that at the time of participating in the auction sale by furnishing tender, the petitioner has entered into an agreement to abide by the rules, conditions and regulations agreeing to run the arrack shop and the delay in issuance of the confirmation order was only due to the above said bona fide reason of getting the confirmation from the higher authority for the price, which was lower than the upset price fixed by the Department. The petitioner, having agreed by the terms and conditions of the sale, cannot take advantage of the delay of just over a month in getting the confirmation from the higher authority. 11. Learned Additional Government Pleader further submitted that during the course of audit of accounts for the excise years 1982-83 and 1983-84, the Accountant General, Chennai, has raised objections that there was a loss of revenue to the tune of Rs.1,29,869/- and that the liability has to be fixed on the persons, who had caused loss. 11. Learned Additional Government Pleader further submitted that during the course of audit of accounts for the excise years 1982-83 and 1983-84, the Accountant General, Chennai, has raised objections that there was a loss of revenue to the tune of Rs.1,29,869/- and that the liability has to be fixed on the persons, who had caused loss. As the delay in confirmation was on account of administrative reasons, proposals were submitted by the District Collector, Madurai, dated 12.07.1994, to the Commissioner of Prohibition and Excise, Chennai, to write off the notional loss pointed out by the Accountant General, Chennai. However, the said proposals were rejected and the Government, in their letter (2D) No.33, dated 08.05.1996, Prohibition and Excise Department, directed to fix liability on the individual, who offered the tender, for the recovery of the notional loss, pointed out in the audit. Since the write off proposals were not accepted by the Government and having regard to the further instructions to fix the liability on the tenderer, the petitioner, vide Office Roc.No.452/96A, dated 17.06.1996, was directed to remit the amount within 15 days from the date of receipt of notice. In this connection, the Special Deputy Collector (Revenue Recovery Act), Idukki District, Kerala State, was also requested to furnish the particulars for the issue of a Certificate under the Revenue Recovery Act. 12. Referring to Rule 7 of the Toddy and Arrack (Disposal in Auction) Rules, 1981, learned Additional Government Pleader submitted that a tender once submitted shall not be withdrawn before the expiry of 60 days from the date of receipt of the tender or until the shop is finally sold in auction whichever is earlier. It does not follow that after the expiry of 60 days from the date of receipt of the tender, the tender offered will become automatically invalid. Inasmuch as the contract has already come into existence on the acceptance of offer, there is no question of withdrawal of an offer, after the same has been duly accepted. Therefore, she submitted that the petitioner cannot wriggle out the terms and conditions of the contract. 13. Inasmuch as the contract has already come into existence on the acceptance of offer, there is no question of withdrawal of an offer, after the same has been duly accepted. Therefore, she submitted that the petitioner cannot wriggle out the terms and conditions of the contract. 13. Learned Additional Government Pleader further submitted that as per Rules 16 and 17 of the above said Rules, the petitioner ought to have remitted the balance deposit of 2½ months rental as advance and should have applied for the issue of licence within one week from the date of receipt of the order of confirmation, i.e., before 20.10.1983. But, he did not pay the rentals nor applied for licence within the above said period. Instead letter, dated 110. 1983, he had backed out of the tender, which resulted in the shop being sold in a subsequent auction with lower rate and thus, there was a revenue loss caused to the Government to the tune of Rs.1,29,869/-She further submitted that on receipt of the orders from the Government, a memo, dated 17.06.1996, was issued by the third respondent, instructing the petitioner to remit a sum of Rs.1,29,869/-within 15 days from the date of the order. For the abovesaid reasons, she prayed that the petitioner is liable to pay the notified loss and the action taken by the respondents is in accordance with the rules. Hence, she prayed for dismissal of the Writ petition. 14. Heard the learned counsel for the parties and perused the materials available on record. 15. In order to adjudicate the issue as to whether the petitioner can be fastened with a liability to pay the revenue loss to the government, it is necessary to extract few provisions of the Tamilnadu Prohibition Act, and the Rules, governing the auction of shops. Heard the learned counsel for the parties and perused the materials available on record. 15. In order to adjudicate the issue as to whether the petitioner can be fastened with a liability to pay the revenue loss to the government, it is necessary to extract few provisions of the Tamilnadu Prohibition Act, and the Rules, governing the auction of shops. Section 18(1) of the Tamil Nadu Prohibition Act, 1937, deals with the recovery of amount due to the State Government and it reads as follows: "(i) Notwithstanding anything contained in this Act or in any other law for the time being in force and without prejudice to any other mode of recovery which is being taken or may be taken, any amount due to the State Government under any of the provisions of this Act or the rules made thereunder along with interest, at such rate as may be specified by the State Government, may be recovered, by the officer empowered by the State Government, - .(a) by deducting the amount due with interest from any money owing to the person which may be in the hands or under the control or disposal of any officer of the State Government; or .(b) by recovering the amount due with interest by attachment and sale of excisable articles belonging to the persons from whom such amount is due. .(2) If the amount due to the State Government with interest cannot be deducted or recovered in the manner provided for in sub-section (1) or the money so deducted or recovered is not sufficient to satisfy the amount and interest so due, the officer empowered may prepare a certificate signed by him specifying the amount with interest due or, as the case may be, the balance of the amount due from the person and send it to the Collector of the district in which such person resides or carries on business and the Collector, on receipt of such certificate, shall recover the amount with interest specified therein as an arrear of land revenue from the said person. .(3) Notwithstanding anything contained in any law for the time being in force and subject to the prior claim, if any, of the State Government in respect of land revenue, any amount due to the State Government with interest shall be a first charge upon the property or interest in the property of the person from whom the amount is due." A conjoint reading of Section 18(1) of the Tamilnadu Prohibition Act and Rule 21 of the Toddy and Arrack Act (Disposal in Auction) Rules, 1981, makes it clear that the statute itself has adopted the procedure stated in the Revenue Recovery Act. Before adverting to the facts of this case, this Court also deems it fit to consider some of the decisions of the courts relating to notional loss caused to the Government. As per Rule 16 of the Toddy and Arrack Shops (Disposal in auction) Rules, the Sale Officer, if he accepts provisionally the bid of the auction purchaser shall issue a notice to the auction purchaser to pay as advance, in any case within seven days from the date of the sale, an amount equal to three months rental in addition to the earnest money deposit already made under rule 8 but inclusive of half a months rental paid at the close of the sale under rule 15. As per Rule 17(1)(a), the auction purchaser, after paying the advance, shall apply to the Excise Officer in form No.2 within a week from the date of receipt of the order of confirmation under rule 20 for the issue of a licence with the details of site selected for the location of the shop. Rule 20 deals with confirmation of sale by district collector:(1) Every bid provisionally accepted the by the Sale Officer shall be subject to confirmation by the Collector and on such confirmation the orders of the Collector shall be final, unless it is revised by the Commissioner for special reasons to be recorded in writing. The Commissioner may, on appeal or revision or suo motu, revise any order of the Collector confirming a bid provisionally accepted by the Sale Officer, after issuing a show cause notice to the person affected and considering his representations, if any,. The Commissioner may, on appeal or revision or suo motu, revise any order of the Collector confirming a bid provisionally accepted by the Sale Officer, after issuing a show cause notice to the person affected and considering his representations, if any,. Any order of the Collector confirming the sale of a shop in favour of a person may be cancelled by the Commissioner even subsequent to the grant of a licence to him for reasons to be recorded by him and after giving an opportunity of making representation to all persons concerned. .(b) If any person who, for valid reasons, fails to bid in the auction, desires to take the privilege of selling, by retail, arrack at a higher amount than the amount actually fetched at the time of auction sale, he may apply to the Collector before confirmation of the auction sale of the shop in favour of the auction purchaser, or to the Commissioner, if the orders of confirmation are passed by the Collector. Before making such application, three months rental offered by him shall be remitted by him in advance. Such offer of enhanced monthly rental shall be more than 25 per cent of the highest bid already fetched at the auction sale or Rs.500 (Rupees five hundred only) whichever is higher. On receipt of such application, the Collector may refuse to confirm the highest bid and direct the resale of the shop from the point at which a higher amount is offered by the person who failed to bid in the auction for valid reasons. If such an application is received by the Commissioner after confirmation of the auction sale by the Collector, the Commissioner may, after issuing a show cause notice to the person affected and after considering his representations, if any, cancel the orders of the Collector for reasons to be recorded by him and direct him to conduct a resale of the shop from the point at which a higher amount is offered by the person who failed to bid in the auction for valid reasons. .Provided that any application to the Commissioner shall be made within 15 days from the date of confirmation of the sale by the Collector and that it shall be open to the Commissioner for valid reasons, to condone the delay for a period not exceeding 15 days. .Provided that any application to the Commissioner shall be made within 15 days from the date of confirmation of the sale by the Collector and that it shall be open to the Commissioner for valid reasons, to condone the delay for a period not exceeding 15 days. .(2) On receipt of the order of confirmation from the Collector and the application for licence in Form No.2 form the auction purchaser, the Excise Officer shall scrutinise the application and forward the same along with his recommendation to the Assistant Commissioner of Prohibition and Excise having jurisdiction over the area,w ho may, subject to the provisions of rule 17, issue a licence in Form 3 under Section 17-C (2) of the Act. .(3) If the Collector considers any bid to be inadequate, he may refuse to confirm the provisional acceptance of the bid, and direct the resale of the shop from the point at which it was last left on such date and at such time and at such place as may be fixed by him. The conditions of resale shall remain unaltered, unless and otherwise directed by the Collector. Three days notice of such resale shall be given to the person affected by the order of the Collector and notice of such resale giving details shall be exhibited in the notice board of the Taluk Office or in any other office where auctions are generally conducted and necessary publicity shall also be made by beat of tom tom in the area concerned and around. .(4) Any resale ordered to be made under sub-rule (3) shall begin with the bid provisionally accepted by the Sale Officer at the original sale and in the name of the individual who offered it. If at such sale a higher bid is offered and is provisionally accepted by the Sale Officer, the bid with which such sale began shall lapse. But, if no higher bid is accepted by the Sale Officer, the matter shall be reported to the Collector, who may pass orders confirming the bid provisionally accepted at the original sale or again direct that the sale be continued from the point at which it was left at the original sale, and the order of the Collector shall be final, unless it is revised by the Commissioner on appeal or revision. .(5) The provisions of sub-rule (4) shall apply to any sale, the re-opening of which is directed under any other circumstances. .(6) No bid which has been provisionally accepted by the Sale Officer shall be withdrawn before it lapses under sub-rule (4) or before orders are passed confirming or refusing to confirm it, and if the bidder commits any breach of the conditions, he shall be liable to make good the difference between his bid and any lower bid which may be finally accepted. Rule 21 speaks about re-sale of shops:--(1) On the failure of any person to make a deposit or apply for a licence or to comply with any requisition under these rules the shop may be resold under the orders of the Collector or on a report from the Assistant Commissioner or the Sale Officer, the Collector may otherwise dispose of the shop. Resales under this rule shall be at the risk of the defaulting bidder, who shall forfeit all gain, if any, that may secure by the resale and in the event of a loss by resale, the defaulting bidder shall be required to make good the difference between the total amount payable for the whole period under the terms of the original sale and the total amount payable by the successful bidder at the resale. In the latter case, the deposits already made by defaulting bidder, excluding the amount of earnest money deposit, if any, shall be recoverable in the same manner, as if it were an arrear of land revenue. Should, however, the deposit be greater than the loss by resale, only such part of the deposits as is necessary to cover the loss by resale shall be forfeited and the balance refunded to the defaulter. The defaulting bidding shall be similarly liable if the shop is disposed of otherwise than by resale and such disposal results in loss to the State Government as compared with the original sale. 16. In Har Shankar Vs. Deputy Excise and Taxation Commissioner, reported in 1975 (1) SCC 737 , the Supreme Court held that Writ jurisdiction of the High Court under Article 226 of the Constitution of India was not intended to facilitate avoidance of obligations voluntarily incurred. 16. In Har Shankar Vs. Deputy Excise and Taxation Commissioner, reported in 1975 (1) SCC 737 , the Supreme Court held that Writ jurisdiction of the High Court under Article 226 of the Constitution of India was not intended to facilitate avoidance of obligations voluntarily incurred. The Apex Court further held that one who makes a bid for the grant of privilege to vend liquor in wholesale or retail with full knowledge of the terms and conditions attaching to the auction cannot be permitted to wriggle out of the contractual obligations arising out of the acceptance of his bid. Dealing with the provisions of Punjab Excise Act, 1914, and of the Punjab Liquor Licence Rules, 1956, the Supreme Court held as follows. "The announcement of conditions governing the auctions was in the nature of an invitation to an offer to those who were interested in the sale of country liquor. The bids given in the auctions were offers made by the prospective vendors to the Government. The Governments acceptance of those bids was the acceptance of willing offers made to it. On such acceptance, the contract between the bidders and the Government became concluded and a binding agreement came into existence between them.... The powers of the Financial Commissioner to grant liquor licences by auction and to collect licence fees through the medium of auctions cannot by writ petitions be questioned by those who, had their venture succeeded, would have relied upon those very powers to found a legal claim. Reciprocal rights and obligations arising out of contract do not depend for their enforceability upon whether a contracting party finds it prudent to abide by the terms of the contract. By such a test no contract could ever have a binding force." 17. In State of Haryana v. Jage Ram reported in 1980 (3) SCC 599 and State of Punjab v. Dial Chand Gian Chand & Co. reported in 1983 (2) SCC 503 , the Apex Court held that persons who offer their bids at an auction to vend country liquor with full knowledge of terms and conditions attaching thereto, cannot be permitted to wriggle out the contractual obligations arising out of the acceptance of their bids by a petition under Article 226 of the Constitution. 18. reported in 1983 (2) SCC 503 , the Apex Court held that persons who offer their bids at an auction to vend country liquor with full knowledge of terms and conditions attaching thereto, cannot be permitted to wriggle out the contractual obligations arising out of the acceptance of their bids by a petition under Article 226 of the Constitution. 18. In State of Haryana v. Lal Chand reported in 1984 (3) SCC 634 , the highest bidder, who participated in an auction for right to sale country liquor, failed to deposit the security deposit as required under the Punjab Liquor Licence Rules, 1956. Apprehending re-auction, he sent a letter to the excise authorities to wriggle out the contractual obligations. The High Court, quashed the demand notice. While interpreting Article 299 (1) of the Constitution of India, at Paragraphs 10, 11 and 12 held as follows: "10. There is a distinction between contracts which are executed in exercise of the executive powers and contracts which are statutory in nature. Under Article 299(1) three conditions have to be satisfied before a binding contract by the Union or the State in exercise of the executive power comes into existence: (1) The contract must be expressed to be made by the President or the Governor, as the case may be. (2) It must be executed in writing. And (3) The execution thereof should be by such person and in such manner as the President or the Governor may direct or authorize. There can be no doubt that a contract which has to be executed in accordance with Article 299(1) is nullified and becomes void if the contract is not executed in conformity with provisions of Article 299(1) and there is no question of estoppel or ratification in such cases. Nor can there be any implied contract between the Government and another person. 11. It is well settled that Article 299(1) applies to a contract made in exercise of the executive power of the Union or the State, but not to a contract made in exercise of statutory power. Article 299(1) has no application to a case where a particular statutory authority as distinguished from the Union or the States enters into a contract which is statutory in nature. Article 299(1) has no application to a case where a particular statutory authority as distinguished from the Union or the States enters into a contract which is statutory in nature. Such a contract, even though it is for securing the interests of the Union or the States, is not a contract which has been entered into by or on behalf of the Union or the State in exercise of its executive powers. 12. ...........It was further held that the statutory duties and liabilities arising on acceptance of the bid at a public auction of a liquor contract may be enforced in accordance with the statutory provisions and that it was not a condition precedent for the recovery of an amount due under Section 28 of the Act, that the amount due and recoverable should be under a formally drawn up and executed contract. This is in recognition of the principle that the provisions of Article 299(1) of the Constitution are not attracted to the grant of such privilege to vend liquor under the Act." 19. A licensee who had taken part in an auction made an initial deposit, but subsequently, withdrew the same contending interalia, that there was no confirmation of the provisional bid. The excise officials re-auctioned the toddy shop and the notional loss sustained by the Government was sought to be recovered. The bidder filed a suit for a permanent injunction against the department. The Courts concurrently held that there was no concluded contract in accordance with Article 112 of the Limitation Act, 1963 and granted the injunction as prayed for. Reversing the judgment of the lower Courts and dismissing the suit, this Court in State of Tamilnadu represented by Collector of Thanjavur and others Vs V.Subramaniam reported in 1996 (1) LW 284 , upheld the power of the excise officials to recover the loss of revenue caused by the Government, on account of re-auction of the Toddy Shop. 20. In T.S.Jothi Selvaraj Vs. State of Tamilnadu represented by the Commissioner, Secretary to the Government, Department of Prohibition and Excise, Chennai, reported in 2005 (3) LW 573 , this Court considered as to whether the action taken by the excise officials for recovery of notional loss after 11 years is barred by limitation under Article 112 of the Limitation Act. In that case, privilege of sale of an arrack shop was auctioned in the year 1984-1985. In that case, privilege of sale of an arrack shop was auctioned in the year 1984-1985. The petitioner therein, was the successful bidder. According to the terms and conditions, the highest bidder has to lift the normal quota of arrack for April 1985, and should pay the full kist. The petitioner therein, failed to pay the sum demanded and therefore, proceedings were initiated under the Revenue Recovery Act. Adjudging the correctness of the order, this Court at paragraph 12 of the judgment held as follows: "12. Rule 20 of the Tamil Nadu Toddy and Arrack Shops (Disposal in Auction) Rules, 1981, which has been made in exercise of power conferred under Section 54 of the Tamil Nadu Prohibition Act, 1937, provides for settlement of shops on the basis of auction. Rule 21 relates to resale of any shop on the failure of any person to make a deposit or to apply for a licence or to comply with any requisition or to execute any bond. In the case of resale of shops, the deposit already made by the defaulting bidder is to be forfeited and adjusted against the amount, and the loss arising from the resale, if any, is recoverable in the same manner as if it were an arrear of land revenue. As per the provisions of the Rules, the licensee is required to execute an agreement in a stamp paper. As per such agreement, any amount due is recoverable if it is an arrear of land revenue. In such view of the matter, it is futile on the part of the petitioner to contend that the amount payable by the licensee is not recoverable as an arrear of land revenue." 21. In the above reported judgment, a memo was issued on 011. 1996, by the Divisional Excise Officer, Thiruvannamalai, directing the petitioner therein to pay a sum of Rs.43,052/- for the excise year 1984-1985. Answering the question as to whether the revenue recovery proceedings initiated after 11 years is barred by limitation, this Court at paragraph No.15 held as follows: "The last contention of the petitioner relates to the question of limitation. It is the contention of the petitioner that even though the amount was payable for the period during 1984-85, proceedings were started only in the year 1997. It is the contention of the petitioner that even though the amount was payable for the period during 1984-85, proceedings were started only in the year 1997. This contention also is unacceptable, because it is apparent that Article 112 of the Limitation Act providing for a period of 30 years is applicable. It is contented that Section 58 of the Revenue Recovery Act excludes the jurisdiction of the Civil Court, and, therefore, Article 112, which relates to suits, is not applicable. The exclusion contemplated under Section 58 of the Tamil Nadu Revenue Recovery Act, 1864, is relating to question as to rate of land revenue and is not at all relevant." 22. In State of Punjab and another Vs.Devns Modern Brewaries Ltd., and another reported in 2004 (11) SCC 26 , the Supreme Court explained the nature of excise contract and its binding effect as follows: 319. The conduct of the respondent/licensee in attempting to wriggle out of his contractual obligations is contrary to the clear and unequivocal principle laid down in Har Shankars case (supra). The issuance of liquor licence constitutes a contract between the parties i.e. between Excise Authorities on the one hand and the individual applicant contractor on the other. The respondent having accepted the contracts/licences, having fully exploited the advantage flowing from the contract to the exclusion of others and having reaped rich commercial benefits from that activity, it is not open to the contractor to wriggle out from the contract by challenging, inter alia, any particular condition of that contract/licence. The respondent herein seeks to do exactly that by challenging the condition requiring him to pay import fee. Har Shankars case (supra) clearly disentitle the liquor contractor from wriggling out of contractual obligations solemnly undertaken. Likewise, in Panna Lals case (supra), this Court in the specific context of liquor licence had this to say. "The licenses in the present case are contracts between the parties. The licensees voluntarily accepted the contracts. They fully exploited to their advantage the contracts to the exclusion of others. The High Court rightly said that it was not open to the appellants to resale from the contracts on the ground that the terms of payment were onerous. "The licenses in the present case are contracts between the parties. The licensees voluntarily accepted the contracts. They fully exploited to their advantage the contracts to the exclusion of others. The High Court rightly said that it was not open to the appellants to resale from the contracts on the ground that the terms of payment were onerous. The reasons given by the High Court were that the licensees accepted the license by excluding their competitors and it would not be open to the licensees to challenge the terms either on the ground of inconvenient consequence of terms or of harshness of terms." In the case of Khoday Distilleries Ltd. and Ors. v.State of Karnataka and Ors., reported in (1995)1 SCC 574 , the Constitution Bench of this Court held that a citizen has no fundamental right to trade or business in liquor as a beverage and that the activities which are res ete may also create monopoly in itself for trade or business in such liquor. It is further held that the State can further place restrictions and limitations on such trade or business and such restrictions and limitations can be placed by subordinate legislation as well. It is also further held that the State is not precluded from regulating the trade and business in potable liquor merely because it imposes tax or fee on purchase or sale and income is derived from such liquor. 23. Again the Supreme Court in Assistant Commissioner Vs. Issac Peter reported in 1994 (2) SCR 67 at paragraphs 14, 22, 23, 24 and 26 explained the nature of contracts relating to excise and of the liability of the licensee who takes a calculated risk in offering his bid to vend liquor which is a trade "res extra commercium" as follows: 14. The contract between the parties is governed by statutory provisions, i.e., provisions of the Act, the rules, the conditions of licence and the counter-part agreement. They constitute the terms and conditions of the contract. They are binding both upon the Government and the licencee. Neither of them can depart from them. It is not open to any officer of the Government to either modify, amend or alter the said terms and conditions, not even to the Minister for Excise. 22. There cases cannot be equated to cases of persons buying airline tickets, where certain conditions are printed in small print. Neither of them can depart from them. It is not open to any officer of the Government to either modify, amend or alter the said terms and conditions, not even to the Minister for Excise. 22. There cases cannot be equated to cases of persons buying airline tickets, where certain conditions are printed in small print. These are cases of formal contracts arrived at pursuant to a public auction or submission of tenders, and in some cases, by negotiation. 23. May be these are cases where the licencees took a calculated risk. May be they were not wise in offering their bids. But in law there is no basis upon which they can be relieved of the obligations undertaken by them under the contract. It is well known that in such contracts - Which may be called executory contracts - there is always an element of risk. Many an unexpected development may occur which may either cause loss to the contractor or result in large profit. Take the very case of arrack contractOrs. In one year, there may be abundance of supplies accompanied by good crops induced by favourable weather conditions; the contractor will make substantial profits during the year. In another year, the conditions may be unfavourable and supplies scarce. He may incur loss. Such contracts do not imply a warranty - or a guarantee -of profit to the contractor. It is a business for him - profit and loss being normal incidents of a business. There is no room for invoking the doctrine of unjust enrichment in such a situation. The said doctrine has never been invoked in such business transactions. The remedy provided by Article 226, or for that matter, suits, cannot be resorted to wriggle out or the contractual obligations entered into by the licencees. 24. Learned Counsel for the Respondents sought to invoke the Rule of Promissory estoppel and estoppel by counduct. The attempt is a weak one for the said Rules cannot be invoked to alter or amend specific terms or contract nor can they avail against statutory provisions. Here, all the terms and conditions of contract, being contained in the statutory Rules, prevail. 26. The attempt is a weak one for the said Rules cannot be invoked to alter or amend specific terms or contract nor can they avail against statutory provisions. Here, all the terms and conditions of contract, being contained in the statutory Rules, prevail. 26. We are, therefore, of the opinion that in case of contracts freely entered into with the State, like the present ones, there is no room for invoking the doctrine of fairness and reasonableness against one party to the contract (State), for the purpose of altering or adding to the terms conditions of the contract, merely because it happens to be the State. In such cases, the mutual rights and liabilities of the parties are governed by the terms of the contracts (which may be statutory in some cases) and the laws relating to contracts. It must be remembered that these contracts are entered into pursuant to public auction, floating of tenders or by negotiation. There is no compulsion on anyone to enter into these contracts. It is voluntary on both sides. There can be no question of the State power being involved in such contracts. It bears repetition to say that the State does no guarantee profit to the licencees in such contracts. There is no warranty against incurring losses. It is a businesses for the licencees. Whether they make profit or incur loss is no concern of the State. In law, it is entitled to its money under the Contract. It is not as if the licencees are going to pay more to the State in case they make substantial profits. We reiterate that what we have said hereinabove is in the context of contracts entered into between the State and its citizens pursuant to public auction, floating of tenders or by negotiation. 24. InK.P.Periannan Vs. The Government of Taminadu and others reported in AIR 1990 Supreme Court 2003, the appellant therein, was the successful bidder and the bid amount was Rs.6550/-per month. As per the terms, the appellant paid the caution deposit of Rs.1000/-and a half months rent on the same day. Since the bid amount was found to be inadequate, there was a re-auction on 11.06.1981, but there was no bidder on that day. Therefore, the shop was again re-auctioned on 19.06.1981, and one Mr.Chellamuthu, was declared as the successful bidder at Rs.6575/-per month, but he failed to comply with certain requirements. Since the bid amount was found to be inadequate, there was a re-auction on 11.06.1981, but there was no bidder on that day. Therefore, the shop was again re-auctioned on 19.06.1981, and one Mr.Chellamuthu, was declared as the successful bidder at Rs.6575/-per month, but he failed to comply with certain requirements. Therefore, it was re-auctioned on 27.06.1981, but there were no bidders and that the shop was once again re-auctioned on 17.08.1981, but the bid amount was only Rs.3000/-. In the abovesaid circumstances, the appellant by a communication dated 17.04.1982, was called upon to pay a notional loss. It was claimed by the department that the bid of the appellant was confirmed on 28.06.1981, but the appellant refused to receive the confirmation order and consequently, the shop was re-auctioned for only Rs.3000/-. Therefore, the loss was sought to be recovered. When the order of recovery was questioned, the High Court held that as the bid was confirmed only on 28.06.1981, the appellant cannot seek for any relief. Being aggrieved, the appellant took up the matter to the Apex court and contended inter-alia, that the bid of the appellant was not accepted and confirmed by the District Collector, as per the rules and the very fact that there were two re-auctions, proved that the bid was not confirmed as per the rules and therefore, the question of recovery of loss from the appellant does not arise. It was also contended before the Supreme Court that Mr.Chellamuthu, the successful bidder in the re-auction held on 19.06.1981, should alone be held responsible for the resultant loss if any, since he was the highest bidder in the subsequent re-auction. 25. Per contra, Learned counsel for State in the above reported case contended that the bid in the subsequent auction was not accepted, whereas, the bid offered by the appellant alone was confirmed, but he had defaulted. The Supreme Court on analysis of the rules and after going through the entire files, came to the conclusion that Mr.Chellamuthus bid was provisionally accepted and consequently, the bid offered by the appellant had lapsed and therefore, he cannot be fastened with any liability for revenue loss. The Supreme Court on analysis of the rules and after going through the entire files, came to the conclusion that Mr.Chellamuthus bid was provisionally accepted and consequently, the bid offered by the appellant had lapsed and therefore, he cannot be fastened with any liability for revenue loss. The facts of this judgment are not applicable to the present case for the reason that, as the bid amount was less than the upset price and that there was a necessity to obtain the concurrence of the higher authority to confirm the sale in favour of the petitioner. 26. Pleadings disclose that the matter was referred to the Commissioner of Prohibition Excise, Chennai, and he had agreed to confirm the sale knocked down at Rs.34,200/- though, upset price fixed by the department was Rs.38,515/-. In the case relied on by the writ petitioner, the Apex Court held that the auction sale was not confirmed in favour of the appellant therein. Per contra, in the case on hand, the sale was confirmed by the order of the District Collector, Madurai, dated 010. 1983, and that the order was also served on the petitioner on 010. 1983. By a memo he was also instructed to remit 2½ months rental for the shop and apply for licence as per rules 16 and 17(1) (a) of the Toddy and Arrack (Disposal in Auction) Rules, 1981. After the receipt of the confirmation order dated 010. 1983, the petitioner has submitted a letter dated 110. 1983, informing the authorities that he was not willing to conduct the arrack shop on the ground that the sale was confirmed after 60 days from the date of furnishing the tender. As rightly contended by the learned counsel for the respondents, as per the provisions of Tamilnadu Toddy and Arrack Shops (Disposal in Auction) Rules, 1981, and conditions of auction sale, once the bid amount is accepted and the sale is confirmed by the competent authority, the completed contract comes into existence and the bidder who made an offer for grant of privilege with full knowledge of the terms and conditions attached to the auction cannot be permitted to wriggle out the contractual obligations arising out of the acceptance of the bid and confirmation of the sale in his favour. 27. 27. As per Rule 7 of Toddy and Arrack (Disposal in Auction), Rules, 1981, the tender submitted shall not be withdrawn before the expiry of 60 days from the date of receipt of tender or until the shop is finally sold in auction whichever is earlier. In the present case, the amount quoted was below the upset price and therefore, the matter had gone up to the level of the head of the department, namely, the Commissioner of Prohibition Excise, Chennai, who had accorded permission to confirm the sale in favour of the Writ petitioner. The auction was conducted on 16.07.1983, and after the acceptance of the bid by the sale officer, the petitioner has also remitted Rs.17,500/- being an advance of half months rental on 21.07.1983, and Rs.8000 towards one fifth security deposit, on the same day. Besides, he has also remitted Rs.1000/- as Earnest Money Deposit. Rule 7 prohibits withdrawal of tender before the expiry of 60 days from the date of tender or until the shop is finally sold in auction whichever is earlier. 60 days period from the date of receipt of the tender has expired on 15.09.1983. Expiry of the said period, does not mean that the tender accepted by the sale officer would become automatically invalid. As regards Rule 7, this Court is of the view that the said rule gives a right to the highest bidder to withdraw before the expiry of 60 days from the date of the receipt of the tender and before confirmation of the same by the licencing authority. Once the tender is accepted the contract, comes into existence and on the acceptance of the tender, there is no question of wriggling out of the terms and conditions of the contract. The petitioner ought to have remitted the balance deposit of 2½ months rental and should have applied for licence within one week from the date of receipt of the order of confirmation. 28. In the unreported decision in W.P.No.7789 of 1999, dated 310. 2006, in A.Arumugam Vs. State of Tamilnadu represented by Commissioner and Secretary Prohibition and Excise Department and 2 others, the petitioner therein, was the successful bidder for the excise year 1981-1982. 28. In the unreported decision in W.P.No.7789 of 1999, dated 310. 2006, in A.Arumugam Vs. State of Tamilnadu represented by Commissioner and Secretary Prohibition and Excise Department and 2 others, the petitioner therein, was the successful bidder for the excise year 1981-1982. Though the licence was granted in his favour on 16.07.1981, but at the intervention of a third party, he could not run the shop and therefore, had to surrender the licence to the concerned authorities, with request to refund the kist amount. The request was not accepted, instead, the Taluk Excise Officer directed the petitioner therein, to pay a huge sum as notional loss. Testing the correctness of the demand, this Court found that the subsequent re-auction was not conducted as per rule 5 of the Toddy and Arrack (Disposal in Auction) Rules, 1981, and that due publicity was also not given for re-auction. Therefore, when the government sustained the revenue loss on account of surrendering the of licence by the petitioner to the excise authorities, this Court, by observing that had the authorities strictly complied with the rules the loss would not have occurred. By observing the same, left with no other option, quashed the impugned demand. The facts of the case are inapposite to the present case. Besides, the petitioner cannot be said to have been restrained from running the arrack shop although, there is a delay of one month in confirming the auction in his favour. 29. As per Sub-rule 4 of Rule 20 of Toddy and Arrack (Disposal in Auction), Rules, 1981, any re-sale ordered to be made under sub-rule (3) shall begin with the bid provisionally accepted by the Sale Officer at the original sale and in the name of the individual who offered it. In the case on hand, the bid amount offered by the petitioner and accepted by the sale officer was Rs.34,200/- but it was not confirmed immediately, as it was lower than the upset price. However, on receipt of the concurrence from the Commissioner of Prohibition and Excise, ChennaI, the District Collector has passed an order of confirmation on 010. 1983, which was also communicated to the Writ petitioner. However, on receipt of the concurrence from the Commissioner of Prohibition and Excise, ChennaI, the District Collector has passed an order of confirmation on 010. 1983, which was also communicated to the Writ petitioner. Sub rule (6) of Rule 20 of the Toddy and Arrack (Disposal in Auction) Rules, 1981, states that no bid which has been provisionally accepted by the sale Officer shall be withdrawn before it lapses under sub rule (4) or before orders are passed confirming and if the bidder commits any breach of the conditions, he shall be liable to make the difference between his bid and any lower bid which may be finally accepted. In the case on hand, the petitioner has failed to make the deposit and apply for licence. He has also submitted a petition dated 110. 1983, expressing his intention not to conduct arrack shop, after confirmation. 30. Pleadings disclose that the subsequent auction fetched only a sum lower than the bid amount offered by the writ petitioner. The contention that the department had sent the proposals only to cover up their mistakes, cannot be accepted, for the reason that judicial notice can be taken that, during the relevant period, several Writ petitions were filed in this court, challenging the demand notices issued to various licensees on account of short lifting of arrack, short supply of arrack by the wholesale distributor etc. In the case on hand, the government have found that the petitioner is not entitled to the waiver and consequently, the department after issuing a show-cause notice has passed the impugned order. A minor variation in computation of the notional loss is not a grave error to vitiate the impugned order. Principles of natural justice has been properly followed by the respondents. There is no manifest illegality. As stated supra, the action to recover the revenue loss is not barred by limitation. For the above said reasons, this Court finds no valid reasons to interfere with the impugned order and therefore, the Writ petition is dismissed. No costs.