A concluded contract for the lease of an arrack shop is not hit by Article 299 of the Constitution of India.

( 1 ) P Subramanyam Reddy is the plaintiff-appellant. He is an excise contractor. In the yearly auction held on September, 12, 1972 for the arrack shop at Chintagunta in Chittoor taluk, his bid for Rs. 1500/- as rental was accepted by the Excise authorities. He paid after the auction rs 330/- as earnest money and Rs. 1,860/- as required under the andhra Pradesh Excise (Lease of Right to Sell Liquor in Retail) Rules 1969 (the Rules ). He was admitted in a hospital on the same day or next day as a result of a car accident and remained for six months in the hospital, therefore, he did not execute agreement as per Rule 22 of the above Rules the arrack shop was re-auctioned on June 1,1973 in which B. Konda reddy of Kothuru was the highest bidder for Rs. 260/- rental. Deducting the amount paid by the second auction-purchaser, the appellant is demanded rs. 15, 221-30 ps. by the Excise authorities on April 4, 1974. That demand notice was questioned in a suit lodged on November, 25, 1974 by Subrahmanyam Reddy. The State Government maintained in the suit the amount was properly demanded from the appellant. The suit was decreed.

( 2 ) IN the suit as well in this appeal, the amount is not disputed. The learned counsel for the appellant at first argued on the above facts the excise authorities did not comply the requirements in rule 20 of the rules. The Excise authorities should have held the re-auction immediately in September, 1972 instead of waiting till June, 1973, for the re-auction, therefore, the appellant is not obliged to pay the suit amount. The state Government explained the delay occurred due to the tation" in that year. The counsel for the appellant however, cited the- decision in P. Bathimaiah Vs. P. Visweswara Pillai (1) 1974 (1) A. P. Law Journal (Short Notes) 7 (Writ Petition No. 5770/72 on November 2, 1973) and argued, the decision applies to the facts of the case, there- fore the appellant is not obliged to pay the amount demanded. That decision is of a single Judge and is no longer good law, for in K. Veera- bhadra Veeraiah Vs. Excise Superintendent, Khammam (2), 1980 (2), a. P. Law Journal (Short Notes) 45 a Division Bench of this court has. taken a different view on the same question. Therefore this contention of the appellant fails.

( 3 ) THE learned counsel next argued rule 20 of the Rules is ultra vires of the Act. There is absolutely no basis to hold rule 20 is ultra vires of the Act. The counsel, however referred to the definition of the expression "excise revenue" in the Andhra Pradesh Excise Act 17 of 1968 and submitted in cases under Rule 22 where agreement is not executed a liability is fixed under rule 20, therefore rule 20 is ultravires of the Act the definition of "excise revenue" shows a rent payable by an auction-pur- chaser is also covered by the definition of excise revenue. In any view of the definition there is no basis to hold rule 20 is ultra vires of Act 17 of 168.

( 4 ) THE principal argument advanced was that in view of Article 299 of the Constitution of India the suit amount cannot be realised from the appellant. The plea is advanced not withstanding the fact that under the Rules the State, Government is entitled to demand the amount. The learned counsel argued. Article 299 of the Constitution of India precludes the authorities from realising the amount. Therefore, the appellant is not obliged to pay the amount. In support of this contention the learned counsel relied on the decisions in Gadde Venkateswara Rao vs government of Andhra Pradesh and others (3) A I R 1966 Supreme court, 828, Deputy Commercial Tax Officer, Park Town Division, Madras and another vs. Sha Sukraj Peerajee (4) AIR 1967 Supreme Court 67, and stateof Uttar Pradesh Vs. Kishorilal Minocha (5) AIR 1960 Supreme Court 680. It is not necessary to go into a detailed discussion of the caseg cited, for a similar argument was rejected in almost anologous facts where no agreement was executed by the Supreme Court. That