JUDGMENT : ABHAY DHANAPAL CHOUGALA, J. 1. This appeal is preferred under Section 61(3) of the Karnataka Excise Act, 1965 (in short "the Act") challenging the order of the 1st respondent, dated 15-11-2018, passed in Appeal No. ECS/14/APP/2018 (in short "the impugned order"), under which he has dismissed the appeal of the appellant herein, filed under Section 61(2) of the Act, challenging the order of the 2nd respondent herein, dated 14-12-2017 passed in No. EXE/BLY-1/CL-9/03/2017-18, directing the appellant-firm herein, to shift its CL-9 to non-objectionable place. 2. In brief, the case of the appellant-firm may be stated as under: The appellant-firm is CL-9 licensee, doing its business of bar and restaurant at Sirivara Village, Ballary Taluk. The said bar and restaurant is situated in the same place for past more than 10 years. The CL-9 of the appellant-firm was duly renewed for the excise years 2017-18 and 2018-19. The 2nd respondent without proper enquiry and without application of judicial mind, acting under Rule 5 of the Karnataka Excise (General Conditions of Licences) Rules, 1967 (in short "the Rules"), passed the order dated 14-12-2017, directing the appellant-firm to shift its business premises to some non-objectionable place, on the pretext that the same is situated within 42 mtrs. from the SC/ST colony and 19 mtrs. from a church. But, in fact the business premises of the appellant-firm is not within the SC/ST colony and even the distance of religious institution cannot be applied in view of the Government Notification No. FD 11 PES 2015, Bengaluru, dated 19-5-2017. Being aggrieved by the same, the appellant-firm preferred an appeal under Section 61(2) of the Act, before the 1st: respondent, who also without application of judicial mind dismissed the appeal. With other several contentions the appellant prays for setting aside the order passed by the respondents 1 and 2. 3. The learned Assistant State Representative (ASR) appeared for the respondents. The records of the authorities below have been secured. 4. We have heard both the sides. The learned Counsel for the appellant placed reliance on the decision of the Hon'ble High Court of Karnataka passed in W.P. Nos. 39539-59542/2010, dated 18-4-2011; W.P. Nos. 31923-927/2018, dated 27-9-2018; W.A. Nos. 2909/2018; 2910-2913/2018, dated 29-10-2018 and decision in H.M. Krishna Reddy vs. H.C. Narayana Reddy, AIR 2001 Kant. 442 : ILR 2001 Kar. 3940. The learned Counsel for the appellant placed reliance on the decision of the Hon'ble High Court of Karnataka passed in W.P. Nos. 39539-59542/2010, dated 18-4-2011; W.P. Nos. 31923-927/2018, dated 27-9-2018; W.A. Nos. 2909/2018; 2910-2913/2018, dated 29-10-2018 and decision in H.M. Krishna Reddy vs. H.C. Narayana Reddy, AIR 2001 Kant. 442 : ILR 2001 Kar. 3940. We have carefully perused the material available on record and therefore, the following points arise for our consideration: (1) Whether the 1st respondent is justified in confirming the order of the 2nd respondent dated 14-12-2017, directing the appellant-firm to shift its business premises to some non-objectionable place, as per Rule 5 of the Rules? (2) What order? 5. Our findings to the above raised points are as under: Point No. 1: In the negative. Point No. 2: As per final order, for the following: REASONS 6. Point No. 1: It is not in dispute that the appellant-firm is possessing licence (CL-9) to run its bar and restaurant business in the premises bearing No. 1686, situated at Sirivara Village of Ballary Taluk, which was renewed for the exercise year 2017-18. It appears that on 20-9-2017, the 2nd respondent herein, received a complaint from Karnataka Rakshana Sene of Ballary Division, as against the appellant-firm. In the said objections, it was alleged that the licenced premises of the appellant-firm is situated in an "objectionable place" i.e., just near the colony where predominantly inhabitants of Schedule Caste and Labours are residing and requested for shifting of the same to some non-objectionable place. It appears that based on the said complaint, the 2nd respondent herein, conducted enquiry by giving an opportunity of being heard to the appellant-firm and was convinced that te licensed premises of the appellant-firm is situated in an objectionable place within the meaning of Rule 5(1) of the Rules and therefore, passed an order dated 14-12-2017, directing to shift the said licenced premises to some non-objectionable place. 7. Being aggrieved by the same, the appellant-firm approached the 1st respondent by filing statutory appeal under Section 61(2) of the Act. After hearing the parties the 1st respondent passed the impugned order of the 2nd respondent. 7. Being aggrieved by the same, the appellant-firm approached the 1st respondent by filing statutory appeal under Section 61(2) of the Act. After hearing the parties the 1st respondent passed the impugned order of the 2nd respondent. In his order he held that newly inserted proviso to Rule 5(2) of the Rules, as per Government notification dated 19-5-2017, is not applicable, if the licenced premises of the appellant-firm is situated near the colony, where predominantly the people belonging to Scheduled Caste and Scheduled Tribes besides. In short, the 1st respondent concurred with the finding of the 2nd respondent that the licenced premises of the appellant-firm is situated in an objectionable place within the meaning of Rule 5(1) of the Rules. 8. During the course of arguments the learned Counsel for appellant-firm specifically contended that both the authorities below have failed to apply their judicial mind and have wrongly come to the conclusion that the licensed premises of the appellant-firm is situated in an objectionable place. He further contended that the licence of appellant-firm is in existence as on 1-7-2016 and therefore, the third proviso to Rule 5(2) of the Rules is applicable and even the finding of the 1st respondent that the licensed premises of the appellant-firm is situated at a distance of 57.30 mtrs. from the colony where the Scheduled Caste and Scheduled Tribe community people are residing, makes it clear that the same is far away from their residential colony. Hence, he prayed for setting aside the orders passed by the authorities below. 9. The points that are required to be determined in this appeal are whether the licensed premises of the appellant-firm, situated at a distance of 57.30 mtrs. from the colony of Scheduled Caste and Scheduled Tribe, can be said as situated in an objectionable place within the meaning of Rule 5 of the Rules and whether newly inserted proviso to Rule 5(2) of the Rules, saves the appellant-firm, from shifting its business premises, as the same is situated within 100 mtrs. from religious institution. 10. For the purpose of convenience it is necessary to extract Rule 5(1) of the Rules, which reads as under: "5. from religious institution. 10. For the purpose of convenience it is necessary to extract Rule 5(1) of the Rules, which reads as under: "5. Restriction in respect of location of shops.-(1) No licence for sale of liquor shall be granted to a liquor shop or premises selected within a distance of 100 meters from any religious or educational institution or Hospital or any office of the State Government or Central Government or local authorities or in a residential locality, where the inhabitants are predominantly belonging to Scheduled Caste and Scheduled Tribes or within a distance of 220 metres from the middle of the State Highways or National Highways. Explanation.-......." 11. It appears that, a third proviso has bene inserted to Rule 5(2) of the Rules, as per the Notification No. FD 11 PES 2015, Bengaluru, dated 19-5-2017, which reads as under: "Provided also that, nothing in sub-rule (1), shall be applicable to the licensed premises located within a distance of 100 meters from any religious or educational institution or Hospital or any office of the State Government or Central Government or Local Authorities, renewed or existed as on 1st July, 2016." 12. From the above extracted relevant portions of Rule 5 of the Rules, it can be said that there is restriction in respect of location of shops near the religious or educational institutions or hospital or any offices of the State or Central Government etc. Further, the restriction is also in respect of such shops to be operated in the residential localities where the inhabitants are predominantly belonging to Scheduled Castes and Scheduled Tribes. But, however, the third proviso inserted to Rule 5(2) of the Rules, makes it clear that the restrictions imposed under Rule 5(1) of the Rules about the locations of the licensed premises within the distance of 100 mtrs. from religious or educational institutions or hospitals or any office of the State Government/Central Government/Local authorities, is not applicable, fi such renewed licence existed as on 1-7-2016. By keeping these clear provisions of the Rules in mind let us consider the factual aspects of the case in hand. 13. As per the case of the 2nd respondent the licensed premises of the appellant-firm is situated at a distance of 57.30 mtrs. from the colony, where the Scheduled Castes and Scheduled Tribes community people are predominantly residing and 19 mtrs. from a religious institution i.e., a church. 13. As per the case of the 2nd respondent the licensed premises of the appellant-firm is situated at a distance of 57.30 mtrs. from the colony, where the Scheduled Castes and Scheduled Tribes community people are predominantly residing and 19 mtrs. from a religious institution i.e., a church. It is not in dispute that the appellant-firm is running its said business sin the said licenced premises since last 10 years. 14. If Rule 5(1) of the Rules is read carefully, then it can be said that restriction of location of shop within 100 mtrs. from the various institution referred in the said rules cannot be applied even to the residential colony of Scheduled Caste and Scheduled Tribe people. In other words, the said Rule has three parts or components. The first part of the said Rule restricts running of liquor shop or premises within 100 mtrs. from any religious or educational institution or hospital or any office of State Government or Central Government or Local Authorities. The second part of the said Rule imposes a restriction on location of such a licensed premises in a residential locality where the inhabitants are predominantly belonging to the Scheduled Caste or Scheduled Tribes. The third part of the said Rule imposes a restriction of location of such licensed premise within a distance of 220 mtrs. from the middle of the State highways or the National Highways. 15. In this case, the contention of the 2nd respondent is that the licensed premises of the appellant-firm is situated at a distance of 57.30 mtrs. from the Scheduled Caste and Scheduled Tribes colony and 19 mtrs. from religious institution. It is not the case of the 2nd respondent that the licensed premises of the appellant-firm is situated in a residential locality where the inhabitants are predominantly belonging to Scheduled Caste and Scheduled Tribes. In other words, it is his specific finding that the distance between the licensed premise of the appellant-firm and the colony of the Scheduled Caste and Scheduled Tribes is 57.30 mtrs. Therefore, it is not proper to hold that the licensed premises of the appellant-firm's situated in an objectionable place within the meaning of Rule 5(1) of the Rules, so as to direct the same to be shifted to some other non-objectionable place. 16. The similar issue was raised before the Hon'ble High Court of Karnataka in W.P. Nos. 39539-39542/2010. Therefore, it is not proper to hold that the licensed premises of the appellant-firm's situated in an objectionable place within the meaning of Rule 5(1) of the Rules, so as to direct the same to be shifted to some other non-objectionable place. 16. The similar issue was raised before the Hon'ble High Court of Karnataka in W.P. Nos. 39539-39542/2010. While disposing the said writ petitions by order dated 18-4-2011, the Hon'ble High Court held that the distant component contemplated under Rule 5(1) of the Rules is inapplicable to residential localities. For the purpose of convenience we have extracted the relevant paragraph of the said order hereunder: "3. .....Having perused Rule 5(1) extracted hereinabove, we are of the considered view, that the distance component contemplated under Rule 5(1) of the Karnataka Excise Licensed (General Conditions) Rules, 1967, is clearly inapplicable to residential localities. Our aforesaid determination is based on the following considerations. Firstly, that insofar as the restriction applicable to residential localities is concerned, the terminology expressed in Rule 5 extracted hereinabove is to the effect, that the restriction would extend to areas within the residential localities itself on account of the use of the words "in residential localities" in Rule 5(1). Secondly, the manner in which measurement of distance expressed in the rule is to be determined has been provided for in sub-rule (3) of Rule 5, wherein, there is no prescription of the manner in which distance is to be measured between liquor shops and the concerned residential locality. For all other aspects of the matter, the manner in determining the distance as clearly and expressly been provided in sub-rule (3) of Rule 5. And thirdly, Rule 5(1) aforesaid, provides for a specified prohibited distance component with reference to religious institutions, educational institutions, hospitals, Government offices, offices of local authorities, State highways and National highways." 17. In view of the above finding of the Hon'ble High Court, it is crystal clear that the licensed premises of the appellant-firm, situated at a distance of 57.30 mtrs. from the residential colony of Scheduled Caste and Scheduled Tribes cannot be said as situated in an objectionable place. If the licensed premises of the appellant-firm was situated in the colony of Scheduled Caste and Scheduled Tribes people then the matter would have been different. from the residential colony of Scheduled Caste and Scheduled Tribes cannot be said as situated in an objectionable place. If the licensed premises of the appellant-firm was situated in the colony of Scheduled Caste and Scheduled Tribes people then the matter would have been different. The distance between the licensed premises and the said colony makes it clear that the licensed premises is far away from the said colony. Hence, the findings of the authorities below that the licensed premises of the appellant-firm is situated in an objectionable place on the ground that it is just 57.30 mtrs. from the residential colony of Scheduled Caste and Scheduled Tribes is totally incorrect. 18. As far as the existence of the licensed premises within 100 mtrs. from the religious institution is concerned, it is saved by the third proviso to Rule 5(2). In other words, as it is not in dispute that the licensed premises of the appellant-firm is existing in the very same place since last 10 years and even renewed or existed as on 1-7-2016, therefore, even if the distance between the church and the said licensed premises is less than 100 mtrs., then also in view of the newly inserted third proviso to Rule 5(2) of the Rules, the question of directing to shift the same does not arise. In short, the newly inserted proviso to Rule 5(2) of the Rules, give relaxation to the appellant-firm from shifting its licensed premises, even if the same is situated within 100 mtrs. distance from the religious or educational institution or hospital or any office of the State Government or Central Government or local authorities. 19. After considering the entire material available on record we are of the view that both the authorities below are not justified in recording their finding that the licensed premise of the appellant-firm is located in an objectionable place and the provisions of Rule 5(1) are applicable. Therefore, the orders passed by the authorities below are liable to be set aside. With these observations we have answered the point under consideration accordingly. 20. Point No. 2: For the foregoing reasons, we proceed to pass the following: ORDER: The appeal filed under Section 61(3) of the Act, is hereby allowed. The order dated 15-11-2018 passed by the 1st respondent in Appeal No. ECS/14/APP/2018, is hereby set aside. With these observations we have answered the point under consideration accordingly. 20. Point No. 2: For the foregoing reasons, we proceed to pass the following: ORDER: The appeal filed under Section 61(3) of the Act, is hereby allowed. The order dated 15-11-2018 passed by the 1st respondent in Appeal No. ECS/14/APP/2018, is hereby set aside. Consequentially the appeal filed under Section 61(2) of the Act, stand allowed and the order of the 2nd respondent dated 14-12-2017 passed in No. EXE/BLY-1/CL-9/03/2017-18, is hereby set aside. Office is hereby directed to send the copies of this judgment to the respondents within 30 days, through registered post along with their respective records.