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2013 DIGILAW 485 (KER)

Shiju v. State of Kerala

2013-06-14

A.M.SHAFFIQUE

body2013
JUDGMENT : The petitioner challenges Ext.P13 an order passed by the Government denying the FL-3 licence which he had requested under the Foreign Liquor Rules. 2. The facts involved in the case would disclose that the petitioner had constructed a hotel complex with 4 star classification. Though an application was submitted earlier for FL-3 licence during February, 2012, the same came to be rejected on the ground that the petitioner did not produce the certificate relating to the 4 star classification. Subsequently by Ext.P1 dated 8.11.2012 petitioner obtained the necessary A star classification certificate. On that basis a fresh application was submitted. All the authorities under the Abkari Rules recommended the grant of licence including the Excise Commissioner. But the Government finally rejected the same by way of Ext.P13. In Ext.P13, it is stated that the Government had decided to appoint a One man commission to recommend a comprehensive change in the present abkari policy including renewal of FL-3 licence already granted. Therefore, a conscious policy decision was taken not to grant any more bar licences till such time. The Foreign Liquor Rules was also amended as per G.O.(P)No.20/13/TD dated 12.2.2013. Further it is stated that as per the judgment of the Supreme Court in Kandath distillery case the application for grant of FL- 3 licence should be considered by the licensing authority by applying the law prevailing as on the date of such consideration and not with reference to the law that was applicable on the date of application. It is also stated that the State Government having the right to frame or re-frame the policy, it was open for the Government to interfere with such matters and having regard to the aforesaid factual situation, it was decided not to grant FL-3 licence to the petitioner. 3. According to the petitioner, the interference by the Government by way of Ext.P13 is clearly bad in law as the Excise Commissioner had exercised his jurisdiction under R.13(3) of the Foreign Liquor Rules and has decided to grant the licence. Such a decision had been taken by the Commissioner of Excise and recommendation to that effect had been issued to the Secretary to Government on 5.12.2012, as evident from Ext.P25 (page 45 and 46). Such a decision had been taken by the Commissioner of Excise and recommendation to that effect had been issued to the Secretary to Government on 5.12.2012, as evident from Ext.P25 (page 45 and 46). In fact the petitioner had produced all the necessary documents including the no objection certificate from the Panchayat for the purpose of enabling the Excise authorities to grant FL-3 licence. 4. Therefore, the contention of the petitioner is that when the petitioner has complied with all the requirements as stipulated under the Rules and when there is a recommendation by the Excise Commissioner, merely for the reason that the Government had thereafter framed a policy, the licence which was recommended to be granted in favour of the petitioner should not be refused. Still further it is contended that when the petitioner approached this Court by filing W.P© No.3104 of 2013 (Shiju v. State of Kerala), a learned Single Judge of this Court in judgment dated 20.2.2013 had clearly observed that the One man commission has been appointed for the formation of a fresh abkari policy. It is also found that since the application of the petitioner was pending consideration, it is only appropriate that the same is considered expeditiously without waiting for the report of the One man commission. Hence, this Court had directed the petitioner's application to be considered in accordance with law and to pass appropriate orders thereon as expeditiously as possible. 5. It is in the light of the aforesaid judgment that Ext.P13 order was passed by the Government. The contention of the learned counsel for the petitioner is that in the meantime, the Excise Commissioner had already recommended the grant of licence on 5.12.2012 and the Government sought to await for One man commission report for the purpose of refusing the licence. 6. Yet another contention urged by the petitioner is with reference to the judgment of a Division Bench of this Court in W.P.(C) No.8152 of 2012 produced as Ext.P8. 6. Yet another contention urged by the petitioner is with reference to the judgment of a Division Bench of this Court in W.P.(C) No.8152 of 2012 produced as Ext.P8. This Court had occasion to consider the validity of an amendment made to the Foreign Liquor Rules held that the law to be applied in considering the application for grant of licence is on the date which the Excise Commissioner considered the application for grant of licence and when he recommends it based on the rule in force as on that date and any amendment made subsequent to the same cannot be relied upon for denying the licence. This judgment is based on an earlier judgment of the Division Bench in W.A. No.469 of 2012 (Kallada Hotels and Resorts v. State of Kerala). It is said that though a Special Leave Petition is filed against the judgment in W.A.No.469 of 2012 and connected cases (Kallada Hotels and Resorts v. State of Kerala) the licences are being issued subject to the result of the Special Leave Petition. 7. Another contention urged by the learned counsel for the petitioner is based on Ext.P24 series documents. That was a case in which one Hotel Elegance was granted FL-3 licence in an application filed by them within a short period, though according to the learned counsel for the petitioner, they did not produce the 4 star classification certificate in time. That was a case in which an application was filed on 22.10.2012. They obtained the 4 star classification only on 31.10.2012 and the licence was granted on 8.11.2012. Therefore, the contention is that the petitioner was discriminated in the matter and when the Government itself has granted license to certain other persons, there was no reason for rejecting the request of the petitioner. 8. The short question to be considered in the above Writ Petition is whether Ext.P13 order of the Government is liable to be set aside for the grounds stated herein. 9. Heard the learned counsel for the petitioner and learned Government Pleader appearing on behalf of the respondents. 10. FL-3 licence is granted under R.13B of the Foreign Liquor Rules which reads as under. 13B. (1) Any person desirous of obtaining a licence may apply to the Commissioner in writing through the Assistant Excise Commissioner of the District concerned. 9. Heard the learned counsel for the petitioner and learned Government Pleader appearing on behalf of the respondents. 10. FL-3 licence is granted under R.13B of the Foreign Liquor Rules which reads as under. 13B. (1) Any person desirous of obtaining a licence may apply to the Commissioner in writing through the Assistant Excise Commissioner of the District concerned. The application shall be stamped with Court fee label of the value prescribed by law. The Assistant Excise Commissioner or such other officer as may be authorized by the Commissioner, shall enquire into all the points mentioned above and submit the application to the Commissioner with his report thereon. He shall, while forwarding his report, comment specifically on the need for a licence with particular reference to the probable demand for liquor and the number of wholesale, restaurant, club or tavern licences already existing and their location. (2) If the Commissioner is satisfied on a consideration of the above factors that there is no objection to the grant of the licence, he may accord sanction for a licence. (3) An order sanctioning the issue of a licence will not itself authorise operations. The party can conduct transactions only after obtaining a formal licence in the appropriate form. The Assistant Excise Commissioner of the Division concerned is competent to renew the licence under these rules, except FL1 and FL6 licences. Provided there is no change in the nature, content or scope of the licences or premises. Provided further that no defaulter of Abkari arrears due to the Government shall be permitted to renew the licence unless he produces from the Excise Department a Certificate to the effect that he has cleared 50% of the Abkari arrears pending at the time of the renewal of the licence. Provided also that in the case of those who have been issued licence subject to the final decision of the High Court of Kerala or the Supreme Court of India, the renewal of licence allowed in such cases shall be subject to their final decision in the respective cases. (4) The licencee shall pay the rental for renewal by Demand Draft in favour of the Assistant Excise Commissioner of the Division concerned.” 11. (4) The licencee shall pay the rental for renewal by Demand Draft in favour of the Assistant Excise Commissioner of the Division concerned.” 11. On a perusal of the aforesaid rule, it is clear that a person who applies for FL-3 licence will have to submit an application to the competent authority and after getting the reports of various authorities concerned, the Commissioner has to accord sanction for licence. Sub-r.(3) further indicates that an order of sanction of licence by the Commissioner does not authorise starting of operations and a party can conduct transactions only after obtaining a formal licence in the appropriate form. Apparently the authority to accord sanction the licence is the Excise Commissioner. As argued by the learned counsel for the petitioner, the Excise Commissioner had already recommended the grant of licence to the Government as evidenced from Ext.P25 (at page 45), which is the communication from Excise Commissioner to the Government on 5.12.2012. Apparently once the Excise Commissioner has taken a decision in the matter, the rules does not provide for the Government in interfering in the said decision making process. There is no provision in the Act or the Rules framed thereunder to enable the Government to interfere with the power which is vested with the Excise Commissioner. However, it is contended by the learned Government Pleader that as per the procedure followed, the Commissioner forwards the recommendation to the Government and finally the order is issued by the Government. What is required under R.13(2) is to accord sanction for licence by the Excise Commissioner which apparently has been done in the case. Therefore, in the absence of any other intervening circumstances like fraud, mistake or misrepresentation as the case may be, the Government cannot interfere with such decision making power of the Excise Commissioner, despite the fact that as a matter of policy or procedure the approval of the Government is also obtained by the Excise Department. 12. In the present case perusal of Ext.P13 would indicate that the Government proceeded on the basis that since they have, as a policy decided not to grant FL-3 licence on account of a One man commission being appointed to consider the abkari policy, licence cannot be granted to the petitioner. 12. In the present case perusal of Ext.P13 would indicate that the Government proceeded on the basis that since they have, as a policy decided not to grant FL-3 licence on account of a One man commission being appointed to consider the abkari policy, licence cannot be granted to the petitioner. That decision of the Government is totally contrary to the judgment of this Court in W.P.(C) No.3104 of 2013 (Shiju v. State of Kerala) wherein this Court had already indicated that the decision has to be taken despite the existence of the One man commission which apparently is for the grant of licences for the next year and does not relate to the policy which is already in existence. Therefore, Ext.P13 order is liable to be set aside for the said reason itself. 13. That apart in the Division Bench Judgment of this Court in W.A. No.470 of 2012 and connected cases (Surendra Das v. State of Kerala), this Court had held that the law that is applicable should be the law as on the date when the application is considered by the Excise Commissioner in terms of R.13B(2). Apparently the Excise Commissioner had taken a decision in the matter as early as on 5.12.2012. At that point of time the amendment to R.13B was not in force which came into existence only on 12.2.2013. Therefore, the policy of the Government as reflected in the amendment had come into force only with effect from 12.2.2013 and by the time, the Excise Commissioner had already taken a decision in the matter as early as on 5.12.2012. Government cannot rely upon a subsequent rule in order to deny the right of the petitioner to have a formal licence especially when the Excise Commissioner had made the recommendation on 5.12.12. Therefore, the decision at Ext.P13 is contrary to the law laid down by this Court in W.A. No.470 of 2012 and connected cases. (Surendra Das v. State of Kerala) 14. Still further there is some justification on the part of the petitioner to contend that discrimination had been meted out against him especially when compared to the instance relating to hotel Elegance. The documents produced by the petitioner at Ext.P24 series also indicates the manner in which another applicant has been dealt with. (Surendra Das v. State of Kerala) 14. Still further there is some justification on the part of the petitioner to contend that discrimination had been meted out against him especially when compared to the instance relating to hotel Elegance. The documents produced by the petitioner at Ext.P24 series also indicates the manner in which another applicant has been dealt with. A person who did not have a 4 star classification at the time when he submitted the application is granted the licence within a short period of time. His application was dated only 22.10.2012 and he is granted licence on 8.11.2012. In the petitioner's case his application is dated 8.11.2012 and though the grant of licence was recommended on 5.12.2012, there had been substantial delay and the Government took its own time to take a decision in the matter and had finally rejected the same as per Ext.P13. 15. Having regard to the aforesaid facts and circumstances which I have narrated, I am of the view that Ext.P13 is liable to be set aside and the petitioner is entitled for the FL-3 licence as recommended by the Excise Commissioner in terms of the procedure prescribed. In the result, this Writ Petition is allowed as follows: (1) Ext.P13 is quashed. (2) There will be a direction to the respondent to grant FL-3 licence to the petitioner within a period of one month from the date of receipt of a copy of this judgment.