Judgment : In both these writ petitions, applications submitted by the petitioners for grant of licences to establish Bar in Narsapuram Town and Vijayawada Corporation were rejected on the ground that already more number of bars exist in the respective towns as compared to ratio of bars vis-à­is population of the towns, and therefore it is not possible to permit the petitioners to establish bars. Aggrieved thereby, these writ petitions are filed. 2. In Writ Petition No.33264 of 2010, petitioner was granted licence to run Bar and Restaurant in Narsapuram town, in the name and style of ‘Sri Sudha Restaurant and Bar’, for the excise year 2008-2009. The premises in which the said licence was established was secured by the petitioner on lease. The lease of the premises expired on 30.06.2009 and petitioner was to evict the premises; on 29.06.2009, petitioner applied for renewal of licence and also for shifting of location of the Bar. On 06.10.2009, petitioner submitted another application to locate the Bar in Door No.5-9/4-29 and to grant licence. 3. Petitioner invoked the jurisdiction of this Court by filing Writ Petition No.14253 of 2010 complaining that no orders are passed on his applications and praying to consider his applications dated 29.06.2009 and 06.10.2009. The said writ petition was disposed of on 29.6.2010 directing the first respondent therein to consider the request of the petitioner in accordance with Government Orders issued in G.O.Rt. No.833, dated 11.06.2010. 4. By order dated 07.12.2010, request of the petitioner for renewal of licence as well as grant of licence in new premises was rejected by the Commissioner, which order is impugned in this Writ Petition. Commissioner held that there is no provision for renewal of licence which had already expired. As with reference to the representation of the petitioner dated 06.10.2009, Commissioner held that a bar licence is granted to an existing Restaurant and as no Restaurant was functioning at the proposed premises, Bar licence cannot be granted. He further held that in Narsapuram Municipality for the excise years 2010-11 and 2011-12 already two bars and six A4 shops are functioning and there is no requirement for the third bar. Commissioner placed reliance on the provisions of Rules 4 and 5 of Andhra Pradesh Excise (Grant of Licence by Selling by Bar and Conditions of Licence) Rules, 2005, (herein after referred to as the Rules) and orders of the Government in G.O.Ms. Commissioner placed reliance on the provisions of Rules 4 and 5 of Andhra Pradesh Excise (Grant of Licence by Selling by Bar and Conditions of Licence) Rules, 2005, (herein after referred to as the Rules) and orders of the Government in G.O.Ms. No.723, dated 02.08.2010. 5. By order dated 10.11.2011, this Court passed interim orders in W.P.M.P. No.42204 of 2010 directing the second respondent to consider the request of the petitioner for grant of licence to establish a bar without reference to G.O.Ms. No.723, dated 02.08.2010. This order was challenged by the respondents in Writ Appeal No.380 of 2012. By order dated 12.04.2012, in W.A.M.P. No.781 of 2012, the Division Bench of this Court stayed the order of learned single Judge. By order dated 9.8.2012 Writ Appeal was disposed maintaining the interim order granted on 12.04.2012 till the disposal of the Writ Petition. 6. In Writ Petition No.33490 of 2010, petitioners intend to establish Bar and Restaurant in Vijayawada Municipal Corporation. Petitioners’ submitted application dated 11.08.2009 for prior clearance. Commissioner of Excise passed orders on 13.09.2010 rejecting the request for grant of licence on the ground that there are more number of bars than permissible in Vijayawada Corporation. By order dated 11.11.2011, this Court passed interim orders in W.P.M.P. No.42466 of 2010 directing the second respondent therein to consider the request of the petitioner for grant of licence to establish a bar without reference to G.O.Ms. No.723, dated 02.08.2010. This order was challenged by the respondents in Writ Appeal No.369 of 2012. By order dated 18.04.2012, in W.A.M.P. No.749 of 2012, the Division Bench of this Court stayed the order of learned single Judge. Writ Appeal was disposed of on 09.08.2012 maintaining the interim order granted on 18.04.2012 till the disposal of the Writ Petition. 7. Petitioner in Writ Petition No.33264 of 2010 filed W.P.M.P. No.50060 of 2012 praying to amend the main prayer in the writ petition. By way of amendment, petitioner prays to assail the validity of G.O.Ms. No.723, Revenue (Excise.II) Department, dated 02.08.2010 and Memo No.43084/Ex.II/2011/09.02.2012 and the proceedings of the Commissioner dated 07.12.2010. Similarly, petitioners in Writ Petition No.33490 of 2010 filed W.P. M.P. No.50059 of 2012 praying to amend the main prayer in the Writ Petition. These petitions are not opposed. Petitions are allowed. Counsels for petitioners and learned Government Pleader advanced arguments as per amended prayers in both the Writ Petitions. 8. Similarly, petitioners in Writ Petition No.33490 of 2010 filed W.P. M.P. No.50059 of 2012 praying to amend the main prayer in the Writ Petition. These petitions are not opposed. Petitions are allowed. Counsels for petitioners and learned Government Pleader advanced arguments as per amended prayers in both the Writ Petitions. 8. Heard Sri O. Manoher Reddy, learned counsel for the petitioners and the learned Government Pleader for Additional Advocate General Sri Badana Bhaskara Rao. 9. Learned counsel for the petitioners submitted that insofar as this petitioner in W.P. No.33264 of 2010 is concerned, he is not assailing the decision of the Commissioner in not granting renewal of licence in accordance with the application submitted by him on 29.06.2009 and the present writ petition is only with reference to his application dated 06.10.2009 to issue a fresh licence. 10. Learned counsel for the petitioners contends that in exercise power under Section 72 of the Andhra Pradesh Excise Act, 1968, the Rules werenotified. These rules provide procedure to grant licences to establish a bar and incidental thereto. Rules 4 and 5 of the Rules vest power in the Commissioner of Excise to process application for grant of licence to establish a Bar and to pass orders. When once such power is vested in the Commissioner of Excise, Government is denuded of any authority to issue or regulate the power exercisable by the Commissioner in accordance with the Rules by way of executive decisions/instructions. Learned counsel contends that orders issued in G.O.ms.No.723, Revenue (Excise.II) Department, dated 02.08.2010 curtail the discretion vested by the statute in the Commissioner of Excise and are thus violative of the statutory provisions. It is contended that the orders in G.O.Ms.No. 723 dated 2.8.2010 supplant the statutory provision and therefore without power or jurisdiction. 11. Learned counsel alternatively submits that even assuming that G.O.Ms. No.723, dated 02.08.2010 was validly issued, the said G.O. has no application to the claim of petitioners since their applications were pending even before the G.O. was issued and G.O. is prospective and cannot apply to pending applications. Thus, the applications submitted by the petitioners ought to have been considered without reference to G.O.Ms.No.723, dated 02.08.2010. Learned counsel further submits that imposing restrictions on number of licences is contrary to right to carry on business of petitioners choice. 12. Thus, the applications submitted by the petitioners ought to have been considered without reference to G.O.Ms.No.723, dated 02.08.2010. Learned counsel further submits that imposing restrictions on number of licences is contrary to right to carry on business of petitioners choice. 12. Learned counsel further submitted that a fine distinction is made with reference to granting of licence to establish a bar and to establish a retail outlet. The licence to establish retail outlet is governed byA.P. Excise (Lease of Right of Selling by Shop and Conditions of Licence) Rules, 2005 (Since replaced by 2012 Rules). Referring to Rules 4 and 5 of the said Rules, learned counsel submits that it is mandatory for the Commissioner to notify the number of shops that can be established in a Village/Municipality/Municipal Corporation, conduct auction and grant licences insofar as retail outlets are concerned whereas in the rules governing Bars, no such limitation is imposed. Individual applications have to be processed by evaluating the applications as per the parameters set out. Rules do not impose restriction on number of bars in a Municipality/Municipal Corporation and what is not contemplated in the rules cannot be introduced by way of executive decisions. 13. Learned Government Pleader submitted that orders in G.O.Ms. No.723 dated 2.8.2010, only guide the Commissioner in exercise of his powers vested by Rule 5 of the Rules. Learned Government Pleader emphasised on the words “requirement” and “other factors” employed in Rule 5 of the Rules. Grant of licence by the Commissioner in exercise of power vested in the Rules is circumscribed by the “requirement” to grant such licence and Commissioner is also entitled to weigh the “other factors” which are necessary in grant of licence to establish a bar. The orders issued in G.O.Ms. No.723 only guide the Commissioner in exercise of his power to grant licence as with reference to the “requirement” to grant a licence and also “other factors” to be considered by the Commissioner and therefore they only supplement but do not supplant. Learned Government Pleader submitted that power is also traceable to Section 17(2) of the Act to issue directions. Learned Government Pleader further contends that as per Section 3(1) of the Act, the Commissioner has to act subject to general or special orders of the Government. He, thus, contends that the power is traceable to these provisions to issue G.O.Ms. No.723. Learned Government Pleader submitted that power is also traceable to Section 17(2) of the Act to issue directions. Learned Government Pleader further contends that as per Section 3(1) of the Act, the Commissioner has to act subject to general or special orders of the Government. He, thus, contends that the power is traceable to these provisions to issue G.O.Ms. No.723. Learned Government Pleader placed reliance on the decisions of the Hon’ble Supreme Court in State of Orissa and others v. Commissioner of Land Records and Settlement, Cuttack and others ( AIR 1998 SC 3067 )and Ishwar Singh v. State of Rajasthan and others ( (2005) 2 SCC 334 )in support of his contention that Government is competent to issue directions as contained in G.O.Ms. No.723 and contends that there is no illegality or irregularity in issuing the directions. Learned Government Pleader further submits that G.O. No. 723 dated 2.8.2010 was issued as per the recommendations of the Commissioner and as desired by him. 14. Learned Government Pleader further submits that the applications of the petitioners are for grant of fresh licences and not a case of renewal. By the time the applications of the petitioners were considered by the Commissioner, the new norms have come into force vide G.O.Ms. No.723. Thus, as on the date of passing of orders by the Commissioner, new norms are in force and they would alone apply. In support of his contention that decision of the Commissioner was validly taken by applying the provisions of G.O.Ms. No.723, learned Government Pleader placed reliance on the decision of Hon’ble Supreme Court in State of Kerala and another v. B. Six Holiday Resorts Private Limited ( (2010) 5 SCC 186 ). 15. To appreciate the contentions of learned counsel for the petitioners and the learned Government Pleader it is useful to extract the relevant provisions of A.P. Excise Act and the Andhra Pradesh Excise (Grant of Licence of Selling by Bar and Conditions of Licence) Rules, 2005, ?A.P. Excise (Lease of Right of Selling by shop and Conditions of Licence) Rules, 2005 and G.O.Ms. No. 723 Revenue (Excise.II) Department dated 02-08-2010. 16. No. 723 Revenue (Excise.II) Department dated 02-08-2010. 16. Sections 3(1), 17, 72 (1), (2) (e) (ee) and (f) of Andhra Pradesh Excise Act, 1968 read as under : “3.Appointment of Commissioner:- (1) The Government may, by notification, appoint an officer as the Commissioner of Prohibition and Excise for the State, who subject to the general or special orders of the Government in this behalf, shall be the chief controlling authority in all matters connected with the administration of this Act. 17. Grant of exclusive privilege of manufacture, etc.:- (1) Subject to the provisions of Section 28 and any rules made in this behalf, the Government may, subject to such conditions as they may deem fit to impose, grant for a fixed period to any person at any place a lease or licence or both either jointly or severally for the exclusive privilege: (i)….. (ii) of selling by wholesale or by retail; or (iii) of manufacturing or of supplying by wholesale, or of both, and of selling by retail, any liquor or other intoxicant within any such area in the State as may be specified in the said order. (2) The Government may confer on any officer the power mentioned in sub-section (1). 72. Power to make rules:-(1) The Government may by notification make rules for carrying out all or any of the purposes of this Act. (2) In particular and without prejudice to the generality of the foregoing provision, the Government may make rules: (e) regulating the periods and localities in which and the persons or classes of persons to whom, licences for the wholesale or retail sale or buying of any intoxicant may be granted and regulating the number of such licences which may be granted in any area; (ee) Separately for shop, Bar or In-house, to regulate the localities in which and the persons or classes of persons to whom lease or licence or both may be granted and to regulate their number which may be granted in any area and the method of selection for grant of such privilege, lease or licence; (f) prescribing the procedure to be followed and the matters to be ascertained before any licence for such sale or buying is granted for any locality; 17. Rules 4 and 5 of A.P. Excise (Lease of Right of Selling by Shop and Conditions of Licence) Rules, 2005 read as under : “4. Rules 4 and 5 of A.P. Excise (Lease of Right of Selling by Shop and Conditions of Licence) Rules, 2005 read as under : “4. Establishment of Shops: The Commissioner of Prohibition and Excise having due regard to requirement, public order, health, safety and other factors as he thinks fit, may fix the number of shops to be established in an area/locality before the publication of the Auction Notice under Rule.5. 5. Auction Notice: (1) Where it is proposed to grant the lease for sale of Indian Liquor and Foreign Liquor by shop a notice of the proposed auction containing the particulars mentioned in sub-rule (2) shall be published, at least (7) seven days in advance of the date of auction, by the Collector of the District in the District, Gazette or in such other manner as the Collector may deem fit. (2) The auction notice shall contain the following particulars : (i) Serial Number and the name of the area/locality where the shop will be established; (ii) The last date, time and place for receipt of tenders; (iii) the place of auction with time and date: (iv) The conditions governing the auction: (v) The lease period; and (vi) Any other matter which may be considered necessary by the auctioning authority.” 18. Rules 4 and 5 of Andhra Pradesh Excise (Grant of Licence of Selling by Bar and Conditions of Licence) Rules, 2005 read as under : “4. Licence : A licence in form-2B, may be granted to an establishment licensed by the local authority to serve food such as a Hotel or a Restaurant, for the sale of Indian Liquor and Foreign Liquor in glasses or pegs for consumption within the licensed premises but not for sale of Indian Liquor and Foreign Liquor for removing it out of the licensed premises. Such licence may be granted in the establishment functioning in municipalities and with a belt area of 2 KMs. of the periphery of such Municipalities, Municipal Corporations and within a belt area of 5 KMs. Of the periphery of such Municipal Corporations and in Tourism Centers (except places of religious tourism) as notified by the Department of Tourism of the State Government or Central Government: Provided that the licence holder shall not purchase or stock Indian Liquor and Foreign Liquor in bottles of sizes less than 750 ML. except beer, wine and ready to drink varieties.” “5. except beer, wine and ready to drink varieties.” “5. Application for licence: (1) The person intending to establish a Bar, may submit an application in form-1A to the Commissioner enclosing a Challan of Rs.1,000/- to get prior clearance. (2) The Commissioner having due regard to requirement and other factors as he deems fit, may grant a prior clearance in Form-2A to such of the applicants covered under sub-rule (1). Provided that the grant of prior clearance shall not confer any right on the applicant for grant of licence in Form-2B. The holder shall not claim for any compensation or loss in case licence in Form-2B is not granted.” ……. 19. G.O.Ms. No.723, dated 02.08.2010 reads as under : “GOVERNMENT OF ANDHRA PRADESH ABSTRACT Prohibition & Excise Department – Sanction of new bar licenses for 2010-11 – Policy guidelines – Issued. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - REVENUE (EXCISE.II) DEPARTMENT G.O.Ms.No:723? Dt:02-08-2010. ?Read:- From Commissioner of Prohibition & Excise, Hyderabad Cr.No.5531/2010/CPE/G2, Dated 26-06-2010. - - * * - - ORDER: The Commissioner of Prohibition & Excise has sent a proposal in the reference read above suggesting certain criteria for granting of new bar licenses in the State. 2. Government, after careful consideration of the proposal submitted by the Commissioner of Prohibition & Excise, decide that the Government’s policy would be to permit new bars very sparingly at places of requirement as determined based on the following objective criteria: a). The eligibility for opening a fresh bar in any Municipality / Municipal Corporation will be calculated basing on the 2001 Census population as given below: Population Slab??? Eligibility Criterion 1) Upto 3 lakhs??? One bar for every 30,000 2) Above 3 lakhs upto 7 lakhs? One bar for every 20,000 3) Above 7 lakhs??? One bar for every 12,000 b). The eligibility for opening a fresh bar in any Municipality / Municipal Corporation will be calculated basing on the 2001 Census population as given below: Population Slab??? Eligibility Criterion 1) Upto 3 lakhs??? One bar for every 30,000 2) Above 3 lakhs upto 7 lakhs? One bar for every 20,000 3) Above 7 lakhs??? One bar for every 12,000 b). From out of the eligible number of bars so arrived at, the number of bars already in existence in 2009-10 and the excess number of retail shops in existence in 2009-10, if any, over and above the number as calculated below shall be deducted: Population Slab??? Eligibility number of retail shops 1) Upto 50,000??? One retail shop for every 10,000 2) Above 50,000 upto 7 lakhs? One retail shop for every 15,000 3) Above 7 lakhs??? One retail shop for every 16,000 c).? In case, in a Municipality having population in excess of 50,000 the eligibility for fresh bars, as arrived at under (a) and (b) above, is zero but the place does not have even a single bar at present, one bar can be allowed to be established to cater to the needs of the on-shop liquor consuming public. d). In case the number of applications filed for grant of bar licence is more than the number of bars that can be newly opened, as arrived at under (a) and (b) and (c) above, the selection shall be made on the basis of drawal of lot among all eligible applicants and in their presence. e). Fresh bars can be opened in Hotels for 3 Star and above status without any restriction based on population of the place.3. The bar policy shall supplement the already announced policy regarding replacement of non-renewed/cancelled bars enunciated through G.O.Ms. No.883, Revenue (Ex.II) Dept., Dt:11.06.2010. 4. The Commissioner of Prohibition & Excise, Hyderabad shall take necessary action in the matter (BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH) ASUTOSH MISHRA PRINCIPAL SECRETARY TO GOVERNMENT 20.? The points for determination in these writ petitions are: (i) Whether the orders of the Government in G.O.Ms. No.883, Revenue (Ex.II) Dept., Dt:11.06.2010. 4. The Commissioner of Prohibition & Excise, Hyderabad shall take necessary action in the matter (BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH) ASUTOSH MISHRA PRINCIPAL SECRETARY TO GOVERNMENT 20.? The points for determination in these writ petitions are: (i) Whether the orders of the Government in G.O.Ms. No.723, dated 02.08.2010 amount to curtailing the discretion vested in the Commissioner by Rule 5 of the Rules to grant licence to run a bar and therefore the said G.O. is in violation of the Rules as the G.O. intends to supplant the statutory mandate and thus ex-facie illegal? (ii) If the G.O. is held valid, whether G.O. Ms No. 723 dated 2.8.2010 is applicable to consider the applications of petitioners to grant licence to run a Bar? 21. State Legislature enacted the A.P. Excise Act, 1968 (Act No.17 of 1961). The aim and objective to bring out legislation was to consolidate and amend the law relating to production, manufacture, possession, transport, purchase and sale of intoxicating liquor and drugs, levy of duties of excise and countervailing duties on alcoholic liquor for human consumption etc. The provisions of the Act were amended from time to time. It is a self contained code dealing with all aspects of Excise in the state. An Officer of the State is appointed as Commissioner of Excise and he shall be the Chief Controlling Authority in all matters connected with the administration of the Act. As mandated by Section 3(1) of the Act, the Officer so appointed acts on behalf of the State subject to the general or special orders of the Government. Section 17 vests power in the Government to impose/grant a lease or licence to sell by retail or to confer such power in any officer. Section 72 of the Act empowers the Government to formulate Rules to carry out the objectives of the Act. In exercise of the power vested in Section 72(2) of the Act, “A.P. Excise (Grant of Licence of Selling of Bar and Conditions of Licence) Rules, 2005” were notified. Rules 4 and 5 vests power in the Commissioner to grant licence to establish a bar. Licence so granted shall be for a period of one year and renewable every year on payment of licence fee and on satisfaction of the conditions as provided in the Rules. 22. Rules 4 and 5 vests power in the Commissioner to grant licence to establish a bar. Licence so granted shall be for a period of one year and renewable every year on payment of licence fee and on satisfaction of the conditions as provided in the Rules. 22. Petitioners are intending to establish bars. As briefly noted above, the rejection of their requests for grant of licences was on the ground that already more number of bars are functioning in the Narasapuram Municipality and Vijayawada Corporation respectively and therefore it is not permissible to grant one more licence. Insofar as petitioner in W.P.No.33264 of 2010, the Commissioner held that as population of Narsapuram town is less than 60,000 and already two bars were established, in addition to the retail shops, it was not possible to grant one more licence and, therefore, the request of the petitioner was rejected. Insofar as the Vijayawada Corporation is concerned, it comes under the slab of III Category i.e. on a population of above 7,00,000, there can be one bar for every 12,000 population. In the said manner, Vijayawada Corporation was eligible to have 70 bar licences but whereas already 118 licences were granted which were functioning. Thus, the application of the petitioners in Writ Petition No.33490 of 2010 was rejected on this ground. 23. Two important elements of Rule 5 of the Rules are “requirement” and “other factors”. It is not automatic that a person having satisfied the “conditions”, would automatically get the licence to establish a bar. Grant of licence is at the discretion of the Commissioner and the Commissioner’s discretion is constrained by words “requirement” and “other factors” used in the Rule. “Requirement” presupposes the necessity to have the bar as proposed by the applicant in a particular locality and Commissioner in his discretion can refuse to grant licence if he is of the opinion that in a particular town, there is no such requirement or there is no requirement to have an additional bar since there is sufficient number of bars already functioning and grant of one more bar may not be desirable in the context of Excise revenue or in the larger public interest. The Commissioner is also entitled to consider “other factors” which include necessity to have more number of bars in a particular town. Thus, even in the absence of the Government orders issued in G.O.Ms. The Commissioner is also entitled to consider “other factors” which include necessity to have more number of bars in a particular town. Thus, even in the absence of the Government orders issued in G.O.Ms. No.723, it is not automatic for the applicant to secure a licence. While exercising the discretion vested in the Commissioner, as with reference to the “requirement” and “other factors”, the orders in G.O.Ms. No.723 channelise discretion of the Commissioner to determine whether in a given town there is any necessity to have one more bar in addition to the existing bars already functioning. For proper exercise of discretion vested in him, the Commissioner desired that the Government prescribe guidelines to establish bars in the towns. As per the suggestions given by the Commissioner, Government formulated the policy of fixing the population as criteria to establish bars and, accordingly, orders are issued in G.O.Ms. No.723. The orders issued in G.O.Ms. No.723 are in the form of guidelines, which intend to guide the Commissioner in processing the applications for grant of licence to run a bar in any town and chanalises the discretion of the Commissioner in assuming the “requirement” of number of bars in a Municipality/Municipal Corporation. It only seeks to avoid exercising the discretion in an arbitrary manner. Since the Rules are silent as to how the Commissioner can exercise his power vested in him by Rule 5 and in order to avoid the allegation of arbitrary exercise of power and also to ensure consistency and uniformity in grant of licences to establish bars, these guidelines are formulated. These guidelines also reflect the policy of the Government. 24. The Rules do not prescribe the population criteria to grant licence. In the absence of provision made in the Rules, Government is not denuded of power to formulate a policy which envisages grant of prescribed number of bar licences based on the population of a town. In the above analysis, I am of the considered opinion that G.O.Ms. No.723 dated 2.8.2010 does not supplant Rule 5 of the Rules; it only guides the Commissioner in taking a decision as mandated by Rule 5 with particular emphasis on the words “requirement” and “other factors” used in Rule 5. Power to lay down the policy of specifying the number of Bars in a town based on the population of the town is traceable to Section 17 of the Act. Power to lay down the policy of specifying the number of Bars in a town based on the population of the town is traceable to Section 17 of the Act. As per Section 3(1) of the Act, the officer of the State Government appointed as Commissioner is required to discharge his powers and duties in accordance with the provisions of the Act and on overall directions of the Government. Analysis of the provisions of the Act would make it clear that power is always preserved in the Government to prescribe appropriate guidelines, issue instructions and orders for the effective implementation of the scheme of the Act and also to regulate the Excise system as such in the State. 25. G.O.Ms. No.723 dated 2.8.2010 do not run contrary to the provisions of the Act or the Rules framed thereunder. It sub serves the aims and objects of the Act. Thus, G.O.Ms.No.723 dated 2.8.2010 is not in violation of the Rules but intend to give effect to the provisions of the Act and the Rules. G.O.Ms.No.723 dated 2.8.2010 does not supplant the statutory provision. To arrive at the above conclusion, I draw support from the following two decisions of Apex Court. 26. In Paramjit Singh alias Mithu Singh v. State of Punjab Through Secretary ( (2007) 13 SCC 530 )the issue for consideration was whether the provisions of Punjab Police Rules, 1934 are in violation of Sections 154 and 172 of Criminal Procedure Code, 1972? It was contended that under the provisions of Punjab Police Rules the First Information Report received must be reduced to writing and be entered in the Police Station Diary and it is only thereafter the First Information Report is to be issued, whereas Chapter XII of Cr.P.C. deals with the information to Police and their powers to investigate into the allegations relating to commission of a cognizable offence starts on information given to an Officer in charge of a Police Station and recorded under Section 154 of the Code of Criminal Procedure. The contention that Punjab Police Rules are in violation of Cr.P.C. was rejected by the Supreme Court. It is held as under : “17. Chapter XII of the Code of Criminal Procedure, 1973 deals with information to the police and their powers to investigate. The contention that Punjab Police Rules are in violation of Cr.P.C. was rejected by the Supreme Court. It is held as under : “17. Chapter XII of the Code of Criminal Procedure, 1973 deals with information to the police and their powers to investigate. Investigation into allegations relating to commission of a cognizable offence starts on information given to an officer in charge of a police station and recorded under Section 154 of the Code. If from information so received or otherwise, the officer in charge of the police station, if satisfied that such information discloses the commission of a cognizable offence, shall either investigate the case himself or direct the investigation to any police officer subordinate to him, in the manner provided by the Code. The procedure as regards the registration of information relating to the commission of a cognizable offence and the procedure for investigation is structured and regulated by Chapter XII of the Code. The procedure prescribed is required to be followed scrupulously by the officer in charge of the police station. 18. The Punjab Police Rules do not in any manner override the provisions of the Code of Criminal Procedure. The said Rules are meant for the guidance of the police officers in the State and supplement the provisions of the Code of Criminal Procedure but do not supplant them. In our considered opinion the truth and veracity of contents of FIR cannot in all cases be tested with a reference to the entries made in the police station daily diary which is maintained under the Punjab Police Rules. This avoidable controversy need not detain us any further since it is well settled that even a defect, if any, found in investigation, however serious has no direct bearing on the competence or the procedure relating to the cognizance or the trial. A defect or procedural irregularity, if any, in investigation itself cannot vitiate and nullify the trial based on such erroneous investigation.” 27. Similar issue fell for consideration before the Supreme Court in Mahmood and another v. State of Uttar Pradesh ( (2007) 14 SCC 16 ). 28. Incidental issue raised by the learned counsel for the petitioners is that G.O.Ms. No.723 was issued on 02.08.2010, whereas the applications for grant of licences by the petitioners were submitted on 06.10.2009 and 11.08.2009, respectively. As these applications were pending by the time G.O.Ms. 28. Incidental issue raised by the learned counsel for the petitioners is that G.O.Ms. No.723 was issued on 02.08.2010, whereas the applications for grant of licences by the petitioners were submitted on 06.10.2009 and 11.08.2009, respectively. As these applications were pending by the time G.O.Ms. No.723 was issued, the said G.O., has no application. As already analyzed, even in the absence of G.O.Ms. No.723, it would be permissible for the Commissioner to reject licences on the ground that there is no “requirement” to have one more bar in Narsapuram Town and Vijayawada Corporation respectively. Furthermore, by the time G.O.Ms No.723 was issued, the applications of the petitioners were pending and while processing the applications for grant of licences under Rule 5 of the Rules, it is permissible for the Commissioner to rely on the guidelines in G.O.Ms. No.723 to find out whether there is any “requirement” of additional bar in Narsapuram Town and Vijayawada Corporation respectively. The Commissioner was guided by the stipulation of population as criteria to determine number of bars required in G.O.Ms. No.723 to reject the claim of the applicants. The claim of the applicants was pending by the time G.O. was issued and as their request was not falling within the parameters set out in the G.O.Ms. No.723, it was rejected. 29. In State of Kerala (3rd supra), one of the issues considered by the Hon’ble Supreme Court read as under: “16. (i) Whether an application for grant of FL-3 licence should be considered with reference to the Rules as they existed when the application was made or in accordance with the Rules in force on the date of consideration?” Hon’ble Supreme Court held as under: “22. Where the rules require grant of a licence subject to the fulfillment of certain eligibility criteria either to safeguard public interest or to maintain efficiency in administration, it follows that the application for licence would require consideration and examination as to whether the eligibility conditions have been fulfilled or whether grant of further licences is in public interest. Where the rules require grant of a licence subject to the fulfillment of certain eligibility criteria either to safeguard public interest or to maintain efficiency in administration, it follows that the application for licence would require consideration and examination as to whether the eligibility conditions have been fulfilled or whether grant of further licences is in public interest. Where the applicant for licence does not have a vested interest for grant of licence and where grant of licence depends on various factors or eligibility criteria and public interest, the consideration should be with reference to the law applicable on the date when the authority considers applications for grant of licences and not with reference to the date of application.” 30. Petitioners have no fundamental right to carry out business in liquor. That being so, no right accrued to them when their applications were made for grant of licences. In Kuldeep Singh v. Government of NCT of Delhi ( (2006) 5 SCC 702 ), Hon’ble Supreme Court held as under: “36. In a case of this nature where the State has the exclusive privilege and the citizen has no fundamental right to carry on business in liquor, in our opinion, the policy which would be applicable is the one which is prevalent on the date of grant and not the one, on which the application had been filed. If a policy decision had been taken on 16.09.2005 not to grant L-52 licence, no licence could have been granted after the said date.” 31. Therefore, there is no illegality on the part of the Commissioner in considering the guidelines stipulated by the Government in G.O.Ms. No.723 while passing orders on the applications submitted by the petitioners and rejecting their applications. Thus, there is no merit in the contentions of the learned counsel for the petitioners on this ground also. Even without G.O.Ms.No. 723 dated 2.8.2010, it is permissible for the Commissioner to reject the application to grant licence to establish a bar and existence of sufficient number of bars in a town is a valid justification to reject the application of petitioners. 32. Even without G.O.Ms.No. 723 dated 2.8.2010, it is permissible for the Commissioner to reject the application to grant licence to establish a bar and existence of sufficient number of bars in a town is a valid justification to reject the application of petitioners. 32. G.O.Ms.No. 723 dated 2.8.2010 is not in violation of the Andhra Pradesh Excise (Grant of Licence by Selling by Bar and Conditions of Licence) Rules, 2005 and in the facts of this case, I am of the considered opinion that there was no illegality or procedural irregularity in rejecting application of petitioners for grant of licences to run bar impugned in the writ petitions warranting interference by this Court. For the reasons aforesaid, writ petitions are dismissed. In consequence, the Miscellaneous Petitions, if any, pending in these writ petitions, shall stand dismissed. No order as to costs.