Heard the learned counsel appearing for the petitioner as well as the learned Government Pleader appearing for the respondents.

2. Petitioner submits that after obtaining prior clearance from the Commissioner of Prohibition and Excise, Hyderabad, vide proceedings in Cr.No.11197/2006/CPE/K3, dated 11-08-2006, for grant of license in Form 2B for sale of Indian made Foreign Liquor and Foreign Liquor in premises bearing Door No.3-181/1, Vemagiri Junction, Vemagiri, Rajahmundry, East Godavari District, for the Excise Year 2006-07,

he filed an application dated 25-08-2006, before the Prohibition and Excise Superintendent, along with necessary documents after duly paying application fee of Rs.10,000/- for grant of license in Form 2B. The Prohibition and Excise Superintendent, after verifying the said application as to the legal requirements, forwarded the same to the Deputy Commissioner of Prohibition and Excise, Kakinada, who, in turn after examining the proposal and inspecting the proposed Bar premises, passed an order, dated 27-09-2006, requesting the third respondent to take necessary action in the matter for issuance of license under Rule 11 in Form 2B for the Excise Year 2006-07. In pursuance of the same, the petitioner paid an amount of Rs.8,00,000/- on 05-10-2006 towards the 1st installment of license fee and furnished bank guarantee for a sum of Rs.8,00,000/- as security towards second installment of license fee on the same day i.e., on 05-10-2006 and requested to issue the license. Accordingly, the Prohibition and Excise Superintendent, issued license vide proceedings Rc.No.295/2006/A3, dated 05-10-2006, to the petitioner for sale of Indian made Foreign Liquor and Foreign Liquor on the aforesaid premises.

3. Petitioner further submits that the license granted on 05-10-2006 was valid up to 30-06-2007 and as per Rule 10 (3) (b) (ii) of the Andhra Pradesh Excise (Grant of License of Selling by Bar and Conditions of License) Rules, 2005 (for short “the Rules”), he is liable to pay only 3/4th of the annual license fee. The grievance of the petitioner is that the respondents are insisting upon him for payment of the full annual license fee.

4. The only question that arises for consideration is as to whether the petitioner is liable to pay the full annual license fee in respect of the license that was granted to him on 05-10-2006.

5. Before going to deal with the merits of the case, it is pertinent to note that the license in question has been granted under the provisions of the Rules.

6. At this juncture, it is relevant to elicit the definition of the “License”, “Licensee”, “License Fee” and “License Period” under the Rules for the purpose of adjudicating the issue involved in this writ petition.

As per Rule 3(i), “License” means license granted under these rules.

As per Rule 3(j), “Licensee” means holder of such license.

As per Rule 3 (k), “License Fee” means annual license fee as shown in the schedule appended to these rules and includes proportionate license fee.

As per Rule 3 (l) “License period” means a period of 12 months beginning from the 1st July of the year and ending with 30th of June of the succeeding year or part thereof.

As per Rule 10 (1), the annual license fee for Form 2B license shall be at the rates as shown in the Schedule appended to these rules.

As per the Schedule appended to Rule 10, the license fee for the privilege at Bar for sale of Indian made Foreign Liquor and Foreign Liquor to be consumed on the licensed premises is Rs.18,00,000/- per year in places where the population of the village/ town / city is above seven lakhs.

7. In the instant case, it is stated that the population of Rajahmundry is not exceeding seven lakhs and, therefore, the annual license fee payable by the petitioner is only Rs.16,00,000/-.

Under Rule 5, the person intending to establish a Bar shall submit an application in Form 1-A to the Commissioner enclosing a challan of Rs.1,000/- to get prior clearance and the grant of prior