The order under challenge, in these petitions, are the proceedings of the Commissioner of Prohibition & Excise, Hyderabad dated 04.08.2012, whereby the Deputy Commissioners of Prohibition & Excise were informed that, in order to stabilize the maximum retail price (MRP) for sale of Indian made foreign liquor (IMFL) and Foreign liquor (FL), and to control illicit distillation, in certain areas/localities it was decided to permit A.P. Beverages Corporation Limited (APBCL) to open outlets for the sale of IMFL& FL in public interest. The Deputy Commissioners were directed to identify suitable premises to locate the outlets, and make all the outlets operational. The Commissioner of Prohibition and Excise (“Commissioner” for short), by proceedings dated 20.07.2012, had earlier conveyed his decision to open 51 outlets at 50 places in certain Districts where notified shops could not be allotted, in the drawal of lots, as no applications were received. However, none of the petitioners in these petitions are aggrieved by the Commissioner’s action in this regard or by his action in permitting APBCL to open retail outlets with a view to control illicit distillation. Their grievance is limited to the permission accorded to APBCL to open outlets in areas in which licences were granted to the petitioners after drawal of lots.

It would suffice to note the facts in W.P. No.26957 of 2012. The District Collector, Prakasam invited applications for grant of licenses for retail outlets, for the licence year 2012-2013, through drawal of lots. The petitioners applied for the shops at Darsi village, and were selected through drawal of lots. They were, thereafter, granted licences. For the year 2012-2013 the annual licence fee was fixed at Rs.34,00,000/- for each shop in Darsi village. The petitioners claim to be running the licensed shops; to have paid 1/3rd of the licence fees; and to have furnished bank guarantees for the balance. The Director of Enforcement, by his proceedings dated 23.07.2012, informed the Deputy Commissioner of Prohibition & Excise, Prakasam of the proposal to open three outlets by APBCL in Prakasam District to ensure stabilization of MRP. One of these outlets was proposed to be opened in Darsi village. Thereafter, by the impugned proceedings dated 04.08.2012, the Commissioner conveyed his decision to permit APBCL to open outlets in certain areas which he considered necessary to stabilize MRP, and to control illicit distillation.

In the counter affidavit, filed on behalf of the Commissioner, it is stated that prior to 01.07.2012 retail liquor vends were given in public auction; the auction system bred many unintended and undesirable results such as retailers violating the MRP, forming cartels, and disregarding consumer interests; the Government, heeding to public demand, had constituted a cabinet sub-committee to examine the policy of retail vending of liquor in the State; after due deliberations with the stake holders, such as manufacturers, retailers and social organizations, the cabinet sub-committee decided to do away with the system of auction of liquor vends; owing to the sensitivity of the subject, and the responsibility thrust on the Government by the directive principles of state policy, the Government formulated a new Excise policy in G.O.Ms.No.390, Revenue Ex.II Department, dated 18.06.2012, for the year 2012-2013 commencing from 1st July, 2012, not to continue with the auction system of retail vends; one of the main objectives of the new policy was to ensure that retailers did not increase the price of liquor, and adhered to the MRP printed on the labels of liquor bottles; to achieve this objective, the government accepted a reduction of Rs.1000 crores per annum as lease amounts, and introduced a fixed licence fee for retail shops at reasonable levels; while fixing the licence fee, care was taken to ensure that the licence holder made a reasonable profit, after payment of the licence fee to the Government, an