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Judgment Summary: Petition under Article 226 — B. Mukerji, J.

Factual and Procedural Background

This is a petition under Article 226 of the Constitution seeking, among other reliefs, quashing of an order of the Excise Commissioner, U.P. (respondent No. 2) which set aside a resale-auction in favour of the petitioners and an order of the Deputy Commissioner, Gonda (respondent No. 1) fixing the date of resale on 2 December 1958; and for a writ of mandamus staying the resale by auction.

Facts: The excise authorities in Gonda held auctions for licences to two liquor shops (Mohalla Naushehra and Mohalla Pure Ghose). Initial highest bidders (Patandin for Naushehra and Sri Jagat Narain for Pure Ghose) failed to deposit sale money; their sales were set aside and a fresh auction was held in which the petitioners became the highest bidders for the two shops. Patandin and Jagat Narain appealed to the Excise Commissioner at Allahabad against the setting aside of their original sale; the Commissioner allowed their appeals, set aside the resale in favour of the petitioners (order dated 15 November 1958), and informed the petitioners on 29 November 1958 that their licences were terminated and that a fresh sale would be held on 2 December 1958.

Procedural history: The petition was initially heard by a learned single Judge who, on a preliminary objection by the State as to the jurisdiction of the Lucknow Bench, referred the matter to a Bench of two Judges. The two‑Judge Bench first considered the preliminary objection regarding the Lucknow Bench's jurisdiction under clause 14, first Proviso, of the United Provinces High Courts (Amalgamation) Order, 1948, before addressing the merits.

Legal Issues Presented

  1. Whether the Lucknow Bench of the High Court had jurisdiction to entertain and make orders in respect of this petition under the Proviso to clause 14 of the United Provinces High Courts (Amalgamation) Order, 1948 (i.e., whether the petition “arose” in an area for which the Lucknow Bench could exercise jurisdiction).
  2. Whether the Excise Commissioner’s order setting aside the resale (dated 15 November 1958) could be quashed on grounds of violation of natural justice (specifically, that the petitioners were not given notice and an opportunity to be heard) or other errors apparent on the face of the record.
  3. Whether the petition should be dismissed because the petitioners had an alternative, equally efficacious remedy (revision to the State Government) available under the Excise Act and rules.

Arguments of the Parties

State / Respondents' Arguments

  • A preliminary objection was raised that the Lucknow Bench had no jurisdiction to entertain or pass orders on the petition because the matter culminated in Allahabad and the Excise Commissioner (respondent No. 2) had his office at Allahabad; the argument emphasized that a writ of certiorari operates on the record, and the record was held at Allahabad (outside the territorial ambit of the Lucknow Bench for such matters).

Petitioners' Arguments

  • The Proviso to clause 14 did not restrict the Lucknow Bench’s jurisdiction in all respects; it only limited the authority to hear cases originating outside specified areas. A judge at Lucknow is a judge of the new High Court and possesses "all the jurisdiction and power" vested in the High Court, and thus could exercise plenary powers where the cause arose in an area assigned to Lucknow.
  • The petitioners specifically contended that they were prejudiced by the Excise Commissioner’s order because they were not given notice of the appeal and thus were denied the opportunity to be heard — asserting a failure of natural justice.
  • Learned counsel additionally suggested (later in argument) that the Excise Commissioner had decided an appeal filed beyond time, but this contention was not supported by averments in the affidavit and was not pleaded in the petition grounds.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Nagendra Nath v. Commissioner, Hills Division, AIR 1958 SC 398 (quoted at p.409) Principle that whether natural justice rules have been contravened must be decided in light of statutory rules/provisions; mere differing view by an appellate authority is not by itself ground for interference under Articles 226 or 227. The court applied this principle to hold that no statutory rules of natural justice were shown to have been contravened by the Excise Commissioner and that the Commissioner’s order, founded on administrative convenience, did not warrant interference under Article 226.

Court's Reasoning and Analysis

The court approached the matter in two stages: (A) preliminary point on jurisdiction of the Lucknow Bench; and (B) merits of the petition.

A. Jurisdictional analysis

  • The court interpreted clause 14 and its Proviso in the United Provinces High Courts (Amalgamation) Order, 1948. The Proviso provided that judges (not less than two) may sit at Lucknow to exercise, in respect of cases "arising in such areas in Oudh," the jurisdiction and power vested in the new High Court.
  • The court examined the critical words "cases arising" and focused particularly on the term "arising." It adopted the ordinary dictionary meaning ("to spring up; to spring forth from its source; to take its rise, originate") rather than any special forensic or technical meaning.
  • Applying that ordinary meaning, the court concluded that the phrase "cases arising" refers to the place of origin of the dispute (i.e., where the cause took its rise), not where it culminated or where an appellate order was made.
  • On the facts, the dispute originated in Gonda (where the auctions and licensing events occurred); Allahabad was only the place of culmination where the Excise Commissioner sat and made the order. Therefore, since the cause arose in Gonda (within the area for which the Lucknow Bench could be directed to exercise jurisdiction), the Lucknow Bench could entertain and make orders in the petition.
  • Regarding the technical point that certiorari operates on the record (and the record was at Allahabad), the court held that the Lucknow Bench had plenary powers equivalent to those of the High Court at Allahabad, and that the Proviso's territorial restriction concerned only the origin of the cause — not the physical location of the record. Hence, if the cause arose in an area assigned to Lucknow, Judges sitting there could issue writs (including certiorari) even though the record was physically held at Allahabad.

B. Merits — natural justice, alternative remedy, and other contentions

  • The Excise Commissioner set aside the resale principally because two shops in different localities had been sold by a single joint bid and the Commissioner found that the fixation of the auction fee for each shop was arbitrary; he considered that the arbitrary apportionment could create practical difficulties in realisation of deficit money.
  • The petitioners argued they were prejudiced because they had not been given notice of the appeals to the Excise Commissioner and therefore were denied the opportunity of being heard (a failure of natural justice).
  • The court examined the statutory scheme under the Excise Act (Section 11) and the Excise Manual: Rule 126 (appeal to the Excise Commissioner) and Rule 130 (revision to the State Government through the Collector and Excise Commissioner within six months, with the caveat that revision will generally not be entertained unless an appeal, where available, has been made and disposed of). The court observed that the petitioners had an alternative remedy: having had an appeal disposed of by the Excise Commissioner, the petitioners could have applied to the State Government for revision of the Commissioner's order.
  • On the natural justice contention, the court noted that no rule had been shown which made it obligatory for the Excise Commissioner to give notice to a party interested or to hear a party before making a decision on the appeal. The court characterized the Excise Commissioner’s action as partly administrative and partly quasi‑judicial; in the present instance the order rested on administrative convenience (avoiding practical difficulties), not on a breach of any statutory rule of procedure.
  • The court relied on Nagendra Nath (supra) to emphasise that claims of breach of natural justice must be assessed in the light of statutory rules and provisions, and that a differing view by the appellate authority is not in itself ground for interference under Articles 226 or 227.
  • As to the late appeal point raised by petitioners' counsel (that the appeal before the Commissioner was filed beyond time), the court observed that the petition's supporting affidavit contained no averment supporting that factual claim, the point had not been pleaded in the grounds, and the other side had had no opportunity to meet the submission; the court therefore refused to take that new ground into account at this stage.
  • Balancing these considerations, the court found that (i) petitioners had an alternative equally efficacious remedy (revision to the State Government), and (ii) nothing showed an error apparent on the face of the record or any failure of natural justice in the exercise of the powers by the Excise Commissioner. These findings formed the basis for rejecting the petition on merits.

Holding and Implications

Holding: The court dismissed the petition with costs.

Implications and consequences:

  • Direct effect on the parties: The petitioners' challenge to the Excise Commissioner’s order and to the Deputy Commissioner’s direction for resale was rejected; the petitioners remain without the relief of quashing the resale order as sought in Article 226 proceedings in this case.
  • Alternative remedy preserved: The court observed that the petitioners had an alternative remedy in the form of a petition for revision to the State Government under the Excise Act / Excise Manual; the existence of that equally efficacious remedy was a key reason for dismissal.
  • No broad new precedent: The court’s decision rested on interpretation of the territorial scope of the Proviso to clause 14 and application of established principles about natural justice in the context of statutory rules; the opinion does not purport to lay down a novel general principle beyond the statutory interpretation and the factual application in this case.

Disposition recorded in the opinion: "Petition dismissed." (with costs)

    Baldeo Ram v. Deputy Commissioner

    B. Mukerji, J.:— This is a petition under Article 226 of the Constitution praying among other the following reliefs:

    “(a) The issue of a writ of certiorari or any other suitable order or direction quashing the orders of the opposite-party No. 2 (i.e, the Excise Commissioner, U.P, Allahabad) setting aside the resale of the auction of the two liquor shops in dispute in favour of the applicants, and quashing the order of opposite-party No. 1 (i.e, the Deputy Commissioner, Gonda, exercising powers under the Excise Act) fixing the date of resale thereof on the 2nd December, 1958, (b) The issue of a writ of mandamus ordering the stay of resale by auction of the two liquor shops.”

    2. The facts that have given rise to this petition may be briefly stated in order to appreciate the question that fell for our determination. The excise authorities in Gonda held an auction for the purposes of granting a license to the highest bidder for the liquor shops, one in Mohalla Naushehra and the other in Mohalla Pure Ghose in the town of Gonda. Patandin was granted a licence for the shop in Mohalla Naushehra, while Sri Jagat Narain was granted licence for the shop in Mohalla Pure Ghose, as they happened to be the two highest bidders. The aforementioned persons failed to deposit the amount of the sale money, so that, the sale in their favour was set aside and a fresh sale was held at which the petitioners, before us, were the two highest bidders in respect of the two shops, one at Naushehra and the other at Pure Ghose. The previous bidders, namely, Patandin and Sri Jagat Narain, preferred appeals against the setting aside of the sale and the resale to the Excise Commissioner at Allahabad, and their appeals were allowed. On the 29th of November, 1958, the petitioners were informed that as a result of the appeals of Patandin and Sri Jagat Narain succeeding, their licenses had to be terminated and were terminated and that a fresh sale in consequence was to be held on the 2nd of December, 1958. The petitioners challenged the validity of the action that was taken by the Excise Commissioner in allowing the appeals and setting aside the sale. They also challenged the order of the Deputy Commissioner directing a fresh sale to be held on December 2, 1958. One of the main contentions raised by the petitioners against the order of the Excise Commissioner was that they did not get an opportunity of being heard and that without hearing them an order which was prejudicial to them had been passed and, therefore, the order was liable to be quashed.

    3. When this petition came up for hearing before a learned single Judge a preliminary objection was taken on behalf of the State to the effect that the Bench sitting at Lucknow had no jurisdiction to entertain, or pass orders on the petition. The learned single Judge, therefore, thought it desirable to have this case put up before a Bench of two Judges. The case has now been put up before us and counsel for the parties first argued the preliminary point, namely, whether the Lucknow Bench had jurisdiction to entertain, or pass orders on this petition.

    4. The contention in regard to the maintainability of this petition at Lucknow was founded on the provisions of clause 14, first Proviso, of the United Provinces High Courts (Amalgamation) Order, 1948.

    5. Clause 14 is in these words:

    “The new High Court, and the judges and division courts thereof, shall sit at Allahabad or at such other places in the United Provinces as the Chief Justice may, with the approval of the Governor of the United Provinces, appoint:

    Provided that unless the Governor of the United Provinces with the concurrence of the Chief Justice, otherwise directs, such judges of the new High Court, not less than two in number, as the Chief Justice may, from time to time nominate, shall sit at Lucknow in order to exercise in respect of cases arising in such areas in Oudh, as the Chief Justice may direct, the jurisdiction and power for the time being vested in the new High Court.

    …. …. …. ….”

    6. The argument that was raised before us was that the case, in respect of which this petition has been filed, arose in Allahabad because the Excise Commissioner (respondent No. 2 to this petition) had his office permanently at Allahabad and further because he had made the order which was sought to be quashed at Allahabad. There is no gain-saying the fact that the second respondent has his place of business at Allahabad and further that the order which is sought to be quashed by a writ of certiorari was made at Allahabad. It is further not disputed that the order of respondent No. 2, which is sought to be quashed, is maintained on a record which is held by him at Allahabad. It was contended by Mr. Uma Shankar Srivastava that since a writ of certiorari operates on the record and since the record is at Allahabad, which according to his further contention was beyond the territorial jurisdiction of the Lucknow Bench, this Bench could not make an order for quashing the order of respondent No. 2.

    7. On behalf of the petitioners it was contended that the Proviso to clause 14 of the United Provinces High Courts (Amalgamation) Order, 1948, did not restrict the jurisdiction of the Lucknow Bench in every aspect of it. What was restricted, it was submitted, was the power to hear or entertain cases. It was pointed out that a judge sitting at the Lucknow Bench was a judge of the new High Court and as such he had “all the jurisdiction and power” that for the time being were vested in the High Court. Indeed, it was said that this was specifically so stated in the Proviso itself. Mr. Niamatullah, on behalf of the petitioners, contended that the Lucknow Bench was to exercise jurisdiction in respect of cases arising in a certain area which was indicated in the Proviso.

    8. Whether the Lucknow Bench could exercise jurisdiction and make an order in respect of the present petition or not was, in our opinion, dependent upon the meaning of the words “exercise in respect of cases arising in such areas in Oudh”. The word ‘case’ is not co-extensive in meaning with the words ‘suit’, ‘appeal’ or ‘proceeding”. The word ‘case’ may have a wider connotation than either a ‘suit,’ an ‘appeal’ or a ‘proceeding,’ or it may have a narrower connotation than these three, for the connotation of the word ‘case’ would depend, in any particular cause on the particular circumstances of that cause and no general rule of definition can, in our opinion, be laid down by which one could test whether a particular matter was a ‘case’ or not. But on the scope and meaning of the word ‘case’ does not depend the answer to the problem facing us, for the word of real significance was the word ‘arising’, and on the true interpretation of this word depended, in our view, the key to the answer. The word ‘arise’, among other meanings, has the meaning “to spring up; to spring forth from its source; to take its rise, originate”. The word ‘arising’ has no special or technical meanine attached to it in forensic language. Therefore, it has to be interpreted in accordance) with its common dictionary meaning and we have quoted the dictionary meaning as given in the. Shorter Oxford English Dictionary, Vol. 1. If we accept that meaning, as we have to, then the phrase ‘cases arising’ must relate to the origin of a case, that is, these words must refer to the place or area of origin of the dispute.

    9. The question which now calls for an answer is, where did the case out of which these proceedings originate or ‘arise’. We know that Gonda was the place of origin of the case which culminated at Allahabad. So that, Gonda was the place of its origin and Allahabad its place of culmination. We do not think it could be legitimately argued that, bearing in mind the connotation of the word ‘case’, the matter which was being agitated arose at Allahabad; nothing arose at Allahabad; something came up to Allahabad for decision. As we have already said above, Allahabad was the place of culmination, the place of origin was Gonda.

    10. The next matter which needs determination is, whether having in view the rule that a writ of certiorari operates on the record and since the record was at Allahabad the Lucknow Bench could issue a writ quashing the order borne on that record. The Lucknow Bench possesses all the plenary powers of the new High Court. The powers which are exercised by Judges sitting at Lucknow are those which are vested in the Judges of the Allahabad High Court: there is no restriction on those powers. What is, so to speak, restricted by the provisions of the Proviso of cl. 14 is the territory from where a cause has arisen in respect of which such powers could be exercised. If Judges pitting at Allahabad could issue a writ of certiorari to quash the order of the Excise Commissioner, then the same order could be passed by Judges of the Lucknow Bench provided the origin of the cause in respect of which the order was to be made arose or originated within an area from where cases could be filed at Lucknow.

    11. Reverting now to the merits of this petition, the sale by which the petitioner obtained the right to run the two liquor shops was set aside, as we have noticed earlier, by the order of the Excise Commissioner dated the 15th of November, 1958. The order aforementioned of the Excise Commissioner was made by him on an appeal which Jagat Narain and Patan Din had filed before him. The main ground on which the Excise Commissioner appears to have set aside the sale was that a sale of two shops situate in two different localities, though of the same town, had been made by a sort of joint auction and yet the licence fee fetched by that auction had been more or less arbitrarily apportioned; the appellate order puts the matter in these words:

    “It is not understood how the auction fee of each of the shops was determined separately when the bid was one viz., Rs. 49294/-. The fixation of the auction fee for each of the shops appears to be arbitrary and since the shops had been held by two different individuals the arbitrary fixation thus operates against them and is also likely to create practical difficulties in the realisation of deficit money from each of the licensees though they happen to be the same under the re-auction.”

    12. The petitioner before us says he was adversely affected by this order of the Excise Commissioner setting aside the aforementioned sale because he happened to have been the licensee under the resale which had been set aside by the Excise Commissioner. The petitioner further contended that as a person interested he should have had notice of the appeal which had been filed by the respondents to the Excise Commissioner. Learned counsel contended that there was a failure of natural justice in this case inasmuch as the requirements of notice which was one of the requirements of natural justice had not been complied with in this particular case. Under the Excise Act by Section 11 a right of appeal is given against all orders passed by the Collector under the Excise Act. These appeals are, of course, subject to Rules which are framed by the Local Government under the Act. Further, a right of revision was vested on the Local Government against any order made by the Collector or by the Excise Commissioner. Chapter H, Sec. XIII of the Excise Manual contains the rules regarding appeals and revisions. Under Rule 126 an appeal lies to the Excise Commissioner from

    (a) an order of a Collector and

    (b) from a decision of a Licensing Board except where it is laid down in the Excise Manual that such decision of a Licensing Board is non-appealable.

    13. Under R. 130, any person aggrieved by an order of the Excise Commissioner or of the Collector or a decision of a Licensing Board may petition to the State Government for revision of the same. The petition for revision is to be received by the State Government if presented through the Collector and the Excise Commissioner within six months from the date of the order or decision, provided that no petition for revision of the order of a Collector or a decision of a Licensing Board would, as a rule, be entertained by the State Government unless an appeal, where one lay, has been made and disposed of by the Excise Commissioner.

    14. In this particular case it is clear that there was an appeal to the Commissioner and the appeal had been disposed of by the Commissioner, so that the petitioner if he was aggrieved by the order of the Commissioner made on appeal, could have applied to the State Government for a revision of the order made by the Excise Commissioner in appeal. That means that the petitioner clearly had another remedy an equally efficacious one open to him.

    15. In regard to the petitioner's contention that he had no notice of the appeal and that an order which prejudicially affected him had been made out without notice to him it has to be observed that no rules had been prescribed which made it obligatory for the Excise Commissioner to give any notice to a party interested in the subject-matter of the appeal, or that the Excise Commissioner was in any way bound to hear a party before he made an order on the appeal. In making his order the Excise Commissioner acted only, at best, in a quasi-judicial manner. In certain spheres his action was purely administrative, but in certain other spheres however, the action that he took or the order that he made partook of the nature of a judicial order. In the instant case the order that the Excise Commissioner made was an order which was made to avoid what he calls practical difficulties. As was pointed out by their Lordships of the Supreme Court in Nagendra Nath v. Commissioner Hills Division, AIR 1958 SC 398 at page 409 that:

    “The question whether or not any rules of natural justice had been contravened, should be decided not under any preconceived notions, but in the light of the statutory rules and provisions. In the instant case, no such rules have been brought to our notice, which could be said to have been contravened by the Appellate Authority. Simply because it viewed a case in a particular light which may not be acceptable to another independent tribunal, is no ground for interference either under Article 226 or Article 227 of the Constitution.”

    16. In the case before us, as we have already pointed out, no rules have been brought to our notice which could be said to have been contravened by the Appellate Authority. As we have said, the basis of the order of the Appellate Authority was administrative convenience. We cannot, therefore, say that in this particular case there has been a violation of any rule of natural justice in regard to notice.

    17. Learned Counsel for the petitioner attacked the order of the Excise Commissioner on the ground that the order had been made by him on an appeal which had been filed before him beyond time. The affidavit accompanying the petition does not make any averment on which we could say that the statement of fact of learned Counsel was supported: this was further, not a ground taken in the grounds on which the petition was founded. Learned Counsel said that he did not have sufficient opportunity at the time when he filed this petition to set out all the grounds on which he could attack the order of the Excise Commissioner; that may have been so then, but since that time learned Counsel has had sufficient opportunity to have his petition amended and add such other or further grounds that appeared to him to support his ultimate objective; we do not, therefore, think that we can take this new ground into account at this stage when the other side has had no opportunity of meeting it. We accordingly have ruled this submission of the learned Counsel out of account. On what we have stated above we reject the preliminary objection and hold that the petition is entertainable. On the merits we hold that the petition should be rejected (1) on the ground that the petitioner had another equally efficacious remedy open to him and (2) because nothing has been shown on which we could say that there was any error apparent on the face of the record or that there was any failure of natural justice in this case. We accordingly dismiss this petition with costs.

    D.H.Z

    18. Petition dismissed.

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    Baldeo Ram v. Deputy Commissioner
    (Feb 13, 1959)