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Abhik Kumar Saha v. State Of West Bengal & Ors.
Summary of Opinion — Ashim Kumar Banerjee, J.
Factual and Procedural Background
The dispute arises from the Government granting supplementary excise licences under Rule 15 of the Bengal Excise Rules to existing licence-holders. Two groups are involved: (a) appellants who hold licences for retail sale of country spirit and (b) private respondents who hold licences for pachwai. The Government, in response to loss of business caused by introduction of foreign liquor and coloured/flavoured spirits, offered supplementary licences — pachwai holders were offered supplementary licences to deal with country spirit (and coloured/flavoured spirit after amendment), and country spirit holders were offered supplementary licences to deal with beer and foreign liquor.
The appellants challenged the grant of supplementary licences to the pachwai licence-holders, contending that a Government Control Order dated February 4, 2000 (the 2000 Control Order) prohibited existing excise licence-holders from applying for licences at new sites and that, as interpreted by the Supreme Court in the case reported at 2002 Vol-IX S.C.C. 177, the Order had statutory force and barred further licence grants at new sites unless existing licences were surrendered.
A writ petition was earlier heard and dismissed by Barin Ghosh, J. by judgment dated March 13, 2001 (reported at pages 238-261 of the paper book). The present appeal challenged that dismissal. While the appeal was pending, Rule 15(2) was amended on March 9, 2000 to provide supplementary country spirit licences to pachwai licence-holders, and new rules in 2003 also provided for similar supplementary licences.
Legal Issues Presented
- Whether the State, by virtue of Rule 15(2) of the Bengal Excise Rules, 1993 (as amended) and corresponding provisions in the 2003 Rules, is entitled to grant a supplementary licence to an existing licence-holder (specifically, permitting pachwai licence-holders to obtain a supplementary licence for country spirit) when a Government Control Order of 2000 imposes a restriction that an existing excise licence-holder is disqualified from applying for a licence at a new site.
- Whether the Supreme Court's decision in the 2002 case reported at 2002 Vol-IX S.C.C. 177 (State of West Bengal v. Mohan Ghosh / Madan Mohan Ghosh (supra))—which upheld the statutory force of the 2000 Control Order in relation to grant of licences at new sites—operates to prevent the grant of supplementary licences under Rule 15.
Arguments of the Parties
Appellants' Arguments
- Relying on the Supreme Court judgment in the 2002 S.C.C. report (Madan Mohan Ghosh (supra)), counsel for the appellants (Mr. A.C. Kar) contended that the 2000 Government Order has statutory force and, consequently, the State is not entitled to grant supplementary licences to pachwai licence-holders for country spirit unless they first surrender their pachwai licences, as had been required by the Supreme Court in that earlier case.
Respondent / State's Arguments
- The learned Advocate General for the State explained that the State found sale of pachwai no longer lucrative and therefore offered supplementary licences to pachwai licence-holders to sell country spirit; similarly, country spirit licence-holders were offered supplementary licences for foreign liquor/beer. These supplementary licences were additions to existing licences, limited to the same licensed premises and subject to the same terms and conditions.
- The State pointed out that Rule 15(2) existed since 1993 and that when country spirit was added by amendment in 2000, the appellants approached the Court; in essence the State maintained that grant of supplementary licences was authorised by the Rules and lawful.
Prior Trial Judge's Conclusion (Barin Ghosh, J.)
- Barin Ghosh, J. (in the March 13, 2001 judgment) concluded that while the Rules provide a distinct method and manner for serving pachwai to consumers, that particular regulatory distinctness cannot prevent pachwai vendors from selling other intoxicating drinks.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| State of West Bengal v. Mohan Ghosh / Madan Mohan Ghosh (reported 2002 Vol-IX S.C.C. 177) | The Supreme Court held that the West Bengal Excise (Selection of persons of grant of licence at new site ...) Order, 2000 (the 2000 Control Order) had statutory force under the Bengal Excise Act and that existing licence-holders for Ganja and other banned intoxicants were not entitled to obtain further excise licences at a new site; the Court permitted rehabilitation by allowing surrender of existing licences and consideration for new licences. | The court in the present opinion relied on that decision for the proposition that the 2000 Control Order validly restricts grant of licences at new sites. However, the court distinguished the precedent on the ground that the Supreme Court did not consider the authority to grant supplementary licences under Rule 15 (which was not the point in that earlier case) and therefore held that the earlier decision does not prevent the State from granting supplementary licences under Rule 15. |
Court's Reasoning and Analysis
The court's analysis proceeds from statutory authority to the specific regulatory provisions and the scope of the Apex Court's earlier decision:
- Statutory empowerment: The court observed that sections 85 and 86 of the Bengal Excise Act empower the State to frame rules for regulating sale and distribution of intoxicating drinks. Rules were framed under this authority, creating mechanisms for both licences at new sites and supplementary licences to existing licence-holders.
- Content of Rule 15: The court examined Rule 15(1) and (2) of the 1993 Rules (and the corresponding Rule 15 of the 2003 Rules). Rule 15(1) permits holders of country spirit retail licences to be granted supplementary licences for beer and coloured/flavoured spirit on the same licensed premises. Rule 15(2) permits holders of pachwai retail licences to be granted supplementary licences for coloured/flavoured spirit; Rule 15(2) was amended on March 9, 2000 to include country spirit among the supplementary licences available to pachwai licence-holders. The 2003 Rules also continued to provide similar supplementary licence entitlements.
- Scope of the 2000 Control Order and Apex Court decision: The court acknowledged that the 2000 Control Order (which barred existing licence-holders from applying for licences at new sites under clause 5.2(a)) was upheld by the Supreme Court in Madan Mohan Ghosh (supra) as having statutory force. The Apex Court's holding was limited to the bar on applying for licences at new sites; in that context the Apex Court allowed a remedial mechanism of surrender-and-consideration for rehabilitation of holders of licences in respect of now-prohibited intoxicants.
- Distinguishing the precedent: The court emphasized that the Apex Court did not consider whether the State could grant supplementary licences under Rule 15; that issue was not before the Supreme Court. Because the earlier decision dealt with the grant of licences at new sites (and not the grant of supplementary licences to operate at the same licensed premises), the court held that the Apex Court's decision does not apply to the present situation concerning Rule 15 supplementary licences.
- Application to present facts: Given that Rule 15(2) (as amended) and Rule 15 of the 2003 Rules expressly authorize the grant of supplementary licences to pachwai holders (for country spirit and coloured/flavoured spirit) and that the State lawfully exercised that power, the court concluded that the State was entitled to grant those supplementary licences. The court also noted that appellants (country spirit licence-holders) remain entitled to apply for supplementary licences for foreign liquor under Rule 15(1), but instructed that appellants had informed the court they did not wish to apply for such licences.
- Conclusion on prior trial judge: The court reviewed the judgment of Barin Ghosh, J., and agreed that the learned Judge had correctly approached the matter and that dismissal of the writ petition was accurate.
Holding and Implications
Holding:
The appeal is dismissed.
Direct consequences and instructions:
- There will be no order as to costs.
- The State lawfully may grant supplementary licences under Rule 15(2) of the 1993 Rules (as amended) and under Rule 15 of the 2003 Rules to existing licence-holders for operation at the same licensed premises; the Supreme Court decision in Madan Mohan Ghosh (supra) concerning the 2000 Control Order and licences at new sites does not apply to the grant of supplementary licences under Rule 15.
- The appellants remain entitled to apply for foreign liquor supplementary licences under Rule 15(1) of the 1993 Rules or Rule 15 of the 2003 Rules; the court directed that if the appellants apply, the State Government shall consider their applications sympathetically and with utmost expedition and dispose of them in accordance with law.
- An urgent xerox-certified copy of the judgment will be supplied to the parties on application.
Broader implications: The court expressly limited its ruling to the direct effect on the parties and the interpretation of the scope of the Apex Court's earlier decision; it did not assert that the opinion creates a new or broader precedent beyond distinguishing the earlier Supreme Court decision with respect to supplementary licences.
Ashim Kumar Banerjee, J.:— Short question involved in this appeal is whether the Government is entitled to issue a supplementary licence to an existing licence holder under Rule 15(2) of the Bengal Excise Rules, 1993 or the under Rules, 2003 when there had been restrictions imposed by the Government order that a person having excise licence is disqualified to apply for another excise licence at the new site.
2. The appellants are the existing excise licence holders for country spirit. Similarly the private respondents were having excise licence for pachwai. By introduction of foreign liquor, country spirit as well as colour and flavoured spirit, pachwai has lost its business worth and as such the Government decided to give them supplementary licence to deal with country spirit as well as the country spirit licence holders were offered supplementary licence to deal with ram and beer. The present disputes pertain to these two groups of licence holders. According to the appellants the Government was not entitled to issue supplementary licence to the pachwai licence holders to deal with country spirit. Hence, this writ petition.
3. The writ petition was heard and disposed of by Barin Ghosh, J. by his judgment and order dated March 13, 2001 appearing at pages 238-261 of the paper book. His Lordship ultimately held that Rules do provide distinct method and manner of serving pachwai to consumers but that can not stand in any way of permitting pachwai vendors to sale other intoxicating drinks.
4. Being aggrieved by the said judgment and order dated March 13, 2001 the appellant preferred the instant appeal. To pursue the problem in hand relevant sections of the Bengal Excise Act and the relevant rules framed thereunder need be discussed.
5. Under sections 85 and 86 of the Bengal Excise Act the State is empowered to frame rules for regulating sale and distribution of intoxicants drinks and other items. Accordingly, rules were framed. Under Rule 15 any holder of licence for retail sale of country spirit could be granted a supplementary licence for sale of beer or coloured and flavoured spirit. This was provided under sub-rule.(1). Under sub-rule (2) the holder of a licence of retail sale of pachwai was to be granted a supplementary licence for retail sale of coloured and flavoured spirit. Rule 15(1) and (2) being relevant herein and are quoted below:
“15. Supplementary licence.—(1) The holder of licence for the retail sale of country spirit for consumption off and on the premises may, on application, be granted a supplementary licence for the retail sale and beer for consumption on the same licensed premises, or a supplementary licence for the retail sale of coloured and flavoured spirit for consumption off and on the same licensed premises, or both.
(2) The holder of a licence for the retail sale of pachwai for the consumption off and on the premises may, on application, be granted a supplementary licence for the retail of coloured and flavoured spirit for consumption off and on the same licensed of premises.”
6. Rule 15(2) was subsequently amended on 9th March, 2000 by providing supplementary licence of country spirit alongwith coloured and flavoured spirit to pachwai licence holders.
7. During the pendency of the appeal on July 30, 2003 a new rule has been framed which also provides for similar supplementary licence to various licence holders. Under 2003 rules pachwai licence holders for consumption of and on the site became entitled to get a supplementary licence for country spirit and coloured and flavoured spirit.
8. Under the West Bengal (Selection of New Sites and Grant of Licence for Retail Sale of Spirit and Certain Other Intoxicants) 1993 there was no specific restriction for the existing licence holder to apply for licence at the new site. However, by a Government order called as West Bengal Excise (Selection of persons of grant of licence at new site for retail sale of spirit and certain other intoxicants other than foreign liquor all categories of licence and licences for denatured spirit) Order, 2000 dated February 4, 2000 restriction was imposed for grant of licence to the existing excise licence holder, Under 5.2(a) an applicant holding other excise licence is not entitled to apply for excise licence at new sites.
9. This Control Order came up for consideration before the Apex Court in the case of State Of West Bengal…Applicant; v. Mohan Ghosh…Opposite Party., reported in 2002 Vol-IX, Supreme Court Cases, Page-177.
10. In the said case before the Apex Court Ganja and opium licence holders were given excise licence to sell Ram and Beer with a view to rehabilitating those persons as those items being Ganja, Bhang etc. came to be prohibited under the Narcotic Drugs and Psychotropic Substances Act, 1985. The Supreme Court came to a conclusion that the Government Order of 2000 was not an executive instruction and was issued by virtue of the power conferred under the State under sections 85 and 86 of the Bengal Excise Act. The Supreme Court observed that the existing licence holders for Ganja and/or other banned intoxicants were not entitled to have further excise licence at the new site because of the power stipulated in the Control Order of 2000. However, taking into account of the act that those intoxicants were prohibited under the Bengal Excise Act and the existing licence holders need to be rehabilitated, the Apex Court gave them opportunity to surrender their existing licence for being considered for grant of new licence for sale of foreign liquor at the new site.
11. Relying on the said judgment of the Apex Court Mr. A.C Kar, learned counsel appearing for the appellants contended that the said Government Order of 2000 had a statutory force as held by the Apex Court and as such the State is not entitled to grant supplementary licence to those pachwai licence holders for country spirit unless and until they surrender licence of pachwai as had been done before the Apex Court.
12. We have considered the relevant rules as discussed hereinbefore as well as the decision of the Apex Court in the case of Madan Mohan Ghosh (supra). Under the Bengal Excise Act the State is empowered to regulate sale and distribution of intoxicants throughout the State. Under the Bengal Excise Act and the Rules framed thereunder there are two types of licences being licence at the new site and supplementary licence. Under the 1993 Rules as well as under 2003 Rules the State is empowered to grant licence at the new site as well as supplementary licence to the existing licence holders. The Apex Court did not consider the authority of the State with regard to grant of supplementary licence as that was not the point in issue before the Apex Court in the case of Madan Mohan Ghosh (supra). The case before the Apex Court was that the existing licence holders applied for licence at the new site which according to the Apex Court was prohibited by the Government Order of 2000 which has its statutory force. Hence, the Apex Court held that the Ganja licence holders were not entitled to have a licence at the new site because of the bar stipulated in the 2000 Control Order. However, considering the facts and circumstances in the said case the Apex Court made a concession for Ganja licence holders by granting them liberty to have excise licence at the new site upon surrendering the existing licence. Such procedure has no application in the instant case. Had those Ganja licence holders applied for supplementary licence at their existing site there was no difficulty for the State to grant supplementary licence to them under Rule 15(3). In the instant case the State Government gave supplementary licence to the existing pachwai licence holders under Rule 15(2) of the 1993 Rules that is para materia with Rule 15 of the 2003 Rules. Similarly, the appellants having existing licence for country spirit are also entitled to have licence for foreign liquors under Rule 15(1). We asked Mr. Kar whether the appellants want to be considered for supplementary licence for sale of foreign liquor and/or beer. On instruction Mr. Kar submitted that appellants are not interested to have any such licence. In our view, the Control Order of 2000 relates to a restriction imposed for grant of licence at the new site. Such restriction was upheld by the Apex Court in the case of Madan Mohan Ghosh (supra). Rule 15 of the 1993 Rules or the 2003 Rules never came up for consideration in the said case before the Apex Court. Hence, the Apex Court decision on that score, in our view, has no application in the instant case.
13. The learned Advocate General appearing for the State contended before us that the State considered the fact the sale of pachwai is no more lucrative and as such pachwai licence holders were given licence to sell country spirit. Similarly, the country spirit holders were also offered supplementary licence for sale of foreign liquor. This supplementary licences are in addition to the existing licence and on the same terms and conditions including sale at the existing site only. Rule 15(2) is holding the field since 1993, when the country spirit was added by way of amendment in 2000 the writ petitioners being the appellants herein approached this Court. We have considered the submissions of the appellants as well as the decision of the learned Judge that had considered in detail the submission of the appellants. We are of the view that the learned Judge had correctly approached the problem and the decision to dismiss the writ petition appears to us as accurate.
14. In the result, appeal fails and is hereby dismissed. There would be however no order as to costs.
15. We once again make it clear that the appellants were and are still entitled to apply for foreign liquor licence under Rule 15(1) of the 1993 Rules or Rule 15 of the 2003 Rules, as the case may be. As and when the appellants apply for supplementary licence for sale of foreign liquor the State Government would immediately consider the same sympathetically and with utmost expedition dispose of their application in accordance with law.
16. Urgent xerox certified copy will be given to the parties, if applied for.
Ashok Kumar Mathur, C.J I agree.
Appeal fails and dismissed.
S.K.P
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