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2025 DIGILAW 722 (TS)

Dolphin Restaurant AND Bar v. Prohibition AND Excise Superintendent

2025-05-28

T.VINOD KUMAR

body2025
ORDER : (T. VINOD KUMAR, J.) Heard learned counsel for the petitioner, learned Government Pleader for Prohibition and Excise appearing for respondent Nos.1 to 4 and perused the record. 2. By the present Writ Petition, the petitioner has assailed the action of the 1 st respondent authority in ordering the petitioner to pay 10% of additional licence fee i.e. a sum of Rs.3,80,000/- for excise year 2012-13 within seven days from the date of receipt of a copy of the order, failing which, the petitioner was informed that the said additional licence fee will be recovered from the bank guarantee furnished by the petitioner as licensee under the provisions of the Andhra Pradesh Excise Act, 1968 ( for short, ‘the Act’) read with the Andhra Pradesh Excise (Grant of License of selling by Bar and Conditions of Licence ) Rules, 2005 (for short, ‘the Rules’). 3. Briefly stated, the case of the petitioner is that it was granted 2B Bar Licence No.71/2006-07 dt.29.11.2006 for establishment of Bar and Restaurant at premises bearing Door Nos.1-7-637/1 and 1-7-640 situated at Subedari, Hanamkonda, Warangal District, by the respondents, in terms of Rules 5 and 11 of the Rules; that the aforesaid licence was renewed from time to time by collecting the prescribed fee; and that the licence is also renewed for the year 2013-14. 4. It is the further case of the petitioner that the respondents- authorities, while granting 2B licence for establishing bar and restaurant, have approved the plan showing the enclosures, whereat the petitioner was permitted to serve liquor for consumption of its customers, which is clearly identified as liquor serving area. 5. 4. It is the further case of the petitioner that the respondents- authorities, while granting 2B licence for establishing bar and restaurant, have approved the plan showing the enclosures, whereat the petitioner was permitted to serve liquor for consumption of its customers, which is clearly identified as liquor serving area. 5. It is the further case of the petitioner that as per Rule 10 of the Rules, the area which is earmarked as liquor serving area in petitioner’s premises is contiguous right from the beginning when licence was granted to it in the year 2006-07 and continued as such; that the 1 st respondent authority basing on the audit objection that it had raised/constructed hut in open place of the licensed premises and as such construction/raising of hut is non-contiguous to the liquor serving area, had booked a case, vide COR No.206/2013-14 on 31.05.2013; that on the aforesaid case being booked by the respondents-authorities, the petitioner had compounded the same, vide proceedings dt.21.06.2013 by paying a fee of Rs.1,00,000/-; and that upon such payment, the case booked against the petitioner was closed. 6. It is the further case of the petitioner that the hut was constructed in the open space of the premises in the month of February, 2013 for serving food and the said hut was removed on 04.06.2013 after the 1 st respondent booked a case vide COR No.206/2013-14 on 31.05.2013 and even during the short period of its existence, the same was not put to use for serving liquor; and that since, the petitioner had compounded the said case booked against it by paying the compounding fee, the respondents-authorities cannot seek to levy 10% of the licence fee as additional licence fee towards non-contiguous enclosure as per Rule 10(2) of the Rules. 7. Petitioner further contends that on the respondents-authorities issuing a show cause notice dt.14.06.2013 calling upon the petitioner to submit explanation to the aforesaid proposal seeking to levy 10% of the licence fee as additional licence fee, it had submitted its reply dt.18.06.2013; and that in addition to submitting explanation to the aforesaid notice, the petitioner had also approached the 3 rd respondent authority and submitted representation, which has not been considered. 8. 8. Petitioner further contends that while the representation submitted to the 3 rd respondent is pending consideration, the 1 st respondent had issued the impugned proceeding directing the petitioner to pay 10% additional licence fee for the year 2012-13 based on the audit objection without applying its independent mind and thus, the impugned demand of payment of additional licence fee is without independent exercise of mind by the 1 st respondent authority and is vitiated. 9. Petitioner further contends that the respondents-authorities having accepted to compound the case booked against the petitioner vide proceedings dt.21.06.2013, cannot seek to demand/levy 10% additional licence fee, as the same would amount to double jeopardy. 10. Without prejudice to the above said contentions, the petitioner also contends that since it had constructed the hut in the open place only in the month of February, 2013 and used the same for short period of four months, having removed the same on 04.06.2013, the levy of additional fee of 10% on the licence fee paid for the year 2012-13 for the whole year is unjustified and at the most, the authorities can levy the said fee proportionately to that of the short period of four months and not for the entire year. 11. Per contra, learned Government Pleader for Prohibition and Excise appearing on behalf of the respondents would submit that as per plan approved by the respondents-authorities while granting 2B Bar licence to the petitioner, an area admeasuring 283.64 square metres was approved as liquor serving area in respect of two premises bearing Municipal Door Nos.1-7-637/1 & 1-7-640; and that the petitioner in addition to the aforesaid permitted liquor serving area had erected/constructed hut in the open area, admeasuring 144 square metres, and was using the same as part and parcel of the licenced premises, for serving liquor in violation of licence conditions, for which the respondents have booked a case vide COR No.206/2013-14 dt.31.05.2013 and on booking of the aforesaid case, the petitioner having come forward to compound the said offence, itself goes to show the petitioner has accepted the violation. 12. 12. On behalf of the respondents, it is further contended that though the petitioner had claimed of it having constructed the aforesaid hut in the month of February, 2013 only, no documentary evidence is placed to show that such construction in fact having been made in the month of February, 2013 by obtaining any permission from the concerned municipal authorities, as permission is required to be obtained from the concerned municipal authorities for the respondents-authorities to accept the aforesaid plea of the petitioner. 13. On behalf of the respondents, it is also contended that as per proviso to Rule 10(2) of the Rules enclosures which are not contiguous shall attract an additional 10% licence fee for each such additional enclosure; and that the hut which is constructed by the petitioner in the open space being non-contiguous to the liquor serving area in the building plan as approved, the petitioner is liable to pay 10% of the licence fee as additional licence fee. 14. On behalf of the respondents, it is contended that the petitioner having made use of the open space by constructing hut therein is liable to pay additional licence fee in terms of the Rules for the year 2012-13, which but for the inspection caused by the 1 st respondent pursuant to audit objection could have escaped the levy. 15. On behalf of the respondents, it is further contended that the petitioner by his own admission by his letter submitted to the 3 rd respondent had admitted to the fact of he having made such construction due to lack of knowledge and compounded the COR registered against him and thus, cannot now claim of he not being liable to pay additional fee. 16. On behalf of the respondents, it is also contended that the 1 st respondent authority before issuing the impugned proceeding demanding the payment of additional licence fee of 10%, had followed all the canons of principles of natural justice – firstly, by issuing a show cause notice, secondly, by considering the explanation submitted by the petitioner and thus, it is not open for the petitioner to contend that the 1 st respondent authority has merely acted on the basis of the audit objection without independent exercise of mind by itself, and thus, the respondents seek for dismissal of the Writ Petition. 17. I have taken note of the respective contentions urged. 18. 17. I have taken note of the respective contentions urged. 18. Though on behalf of the petitioner it has been contended that the construction of hut was temporary in nature and is made only in the month of February, 2013 and removed on 04.06.2013, no material is placed either before the authority in reply to the show cause notice or before this Court to show that such construction having been made only in the month of February, 2013, by obtaining permission more particularly, considering the fact that the definition of ‘building’ under the relevant municipal laws also includes a hut. 19. Further, the claim of the petitioner that the aforesaid construction was undertaken by him due to lack of knowledge and is only intended for supply of food in summer season but not to serve liquor, and for the said reason, the petitioner having compounded the COR registered against it by paying a sum of Rs.1,00,000/-, the representation dt.03.08.2013 submitted to the 3 rd respondent would indicate that the petitioner is nowise to the trade or the procedures that it is required to follow. In fact, at an earlier point of time, against the action of the respondents- authorities in treating both the premises as non-contiguous, he having invoked the jurisdiction of this Court by filing a Writ Petition, vide W.P.No.13043 of 2010, the said claim of the petitioner does not appeal to this Court for being accepted. 20. Further, it is to be noted that since the petitioner has been issued with a 2B Bar licence under the provisions of the Act, it is required to serve liquor only in the area which is earmarked as a liquor serving area in the plan approved by the excise authorities and serving of liquor beyond the liquor serving area would result in the petitioner contravening the rules and the licence conditions. 21. 21. Though on behalf of the petitioner, it is contended that the aforesaid hut was constructed only to serve the food during summer, and liquor has not been served in the aforesaid hut constructed, which claim of the petitioner, on the other hand, is disputed by the respondents, such disputed question of fact cannot be gone into by this Court in a Writ Petition filed under Article 226 of the Constitution of India, for which the petitioner is required to avail the remedies provided under the Act by adducing necessary documentary evidence. 22. Since, the respondents claim that the petitioner having constructed hut in the open area, of the licensed premises without obtaining any prior permission and using the same as an extension to its 2B licence premises, such usage of premises would require the petitioner to pay additional licence fee @10% of licence fee for each such separate enclosure in terms of Rules 13 (2)(c) of the Rules which clearly stipulates that licensee shall sell liquor only at the premises specified in the licence. Since, the licence granted and the plan annexed thereto as approved by the authorities on 30.10.2006 does not show existence of any hut therein which is treated as liquor serving area and on the other hand majority of the area in the building for which approval has been granted only consist of liquor serving area admeasuring 283.6 square metres, the claim of the petitioner of it not serving liquor in the hut constructed by it and only being used for serving food, without there being a separate area earmarked in the plan approved for serving food exclusively as restaurant, the claim put forth by the petitioner does not appeal to this Court for being accepted. 23. In view of the above, this Court is of the view that the action of the respondents-authorities in seeking to levy additional licence fee at 10% of licence fee for constructing hut as part of the licensed premises under the impugned proceeding cannot be said as being contrary to Rules 10 and 13 of the Rules and also contrary to the provisions of the Act for this Court to set aside the same. 24. In view of the above, the present Writ Petition as filed assailing the action of the respondents-authorities is devoid of merit and it is accordingly dismissed. No order as to costs. 25. 24. In view of the above, the present Writ Petition as filed assailing the action of the respondents-authorities is devoid of merit and it is accordingly dismissed. No order as to costs. 25. Miscellaneous petitions, if any, pending in this writ petition shall stand closed.