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2015 Supreme(Bom) 284

IN THE HIGH COURT OF BOMBAY at Nagpur
B.P. DHARMADHIKARI & A.P. BHANGALE, JJ.
M/s. Vidarbha Liquor Corporation - Petitioner
Versus
The State of Maharashtra, through its Principal Secretary, Excise Department & Others - Respondents
Writ Petition No. 1466 of 2012
Decided on: 24-02-2015

Advocates:
Advocate Appeared:
For the Petitioner:R.M. Bhangde, Advocate.
For the Respondents: K.S. Joshi, Asstt. Govt. Pleader.

The power of superintendence conferred upon the Commissioner enables him to ensure compliance with license conditions, and the State Government is entitled to recover all costs incurred for employing supervisory staff.

Headnote:

Supervision Charges - Bombay Prohibition Act - Section 58A - 1949 Act - Summary: The court discussed the legal provisions of Section 58A of the Bombay Prohibition Act, 1949, and its interpretation by the Hon'ble Apex Court. It held that the State Government is entitled to recover all costs incurred for employing supervisory staff, including pay and allowances of government employees posted for supervision. The court also emphasized that the power of superintendence conferred upon the Commissioner enables him to ensure compliance with license conditions, and the petitioner's argument for specific orders from the State Government was dismissed.

Fact of the Case:

The petitioner challenged the retrospective recovery of supervision charges for the period from 01.01.2006 till 31.03.2009, based on the implementation of the 6th wage revision for State Government employees.

Finding of the Court:

The court found that the State Government is entitled to recover all costs incurred for employing supervisory staff, and the petitioner's argument for specific orders from the State Government was dismissed.

Issues: The main issue was whether the State Government's delegation of power to the Commissioner of Prohibition and State Excise for the recovery of supervision charges was valid.

Ratio Decidendi: The court held that the power of superintendence conferred upon the Commissioner enables him to ensure compliance with license conditions, and the petitioner's argument for specific orders from the State Government was dismissed.

Final Decision: The challenge in the writ petition was found to be without merit and was dismissed. Rule discharged with no order as to costs.

Judgment

B.P. Dharmadhikari, J.

1. Considering the nature of controversy, we are deciding the writ petition finally by issuing Rule and making it returnable forthwith, with the consent of parties.

2. Both sides have filed written notes of arguments. Petitioner has been paying costs of supervision as per 6th wage revision for State Government employees from 22.4.2009. Challenge in the petition is expressly restricted to its retrospective levy and recovery for the period from 01.01.2006 till 31.03.2009.

We, therefore, find it appropriate to begin with settled legal position. It will be necessary to make a reference to Section 58A of the Bombay Prohibition Act, 1949 (hereinafter referred to as “the 1949 Act”), which reads thus :

"58A. Supervision over manufacture, etc. The State Government may by general or special order direct that the manufacture, import, export, transport, storage, sale, purchase, use, collection or cultivation of any intoxicant, denatured spirituous preparation, hemp, mhowra flowers, or molasses shall be under the supervision of such Prohibition and Excise or Police staff as it may deem proper to appoint, and that the cost of such staff shall be paid to the State Government by the person manufacturing, importing, exporting, transporting, storing, selling, purchasing, using, collecting or cultivating the intoxicant, denatured spirituous preparation, hemp, mhowra flowers or molasses:

Provided that, the State Government may exempt any class of persons or institutions from paying the whole or any part of the cost of such staff."

3. Challenge to the retrospective recovery of such charges due to retrospective wage revision has been considered and negated at Aurangabad in judgment dated 10.7.2012 in Sahakar Maharshi Bhausaheb Thorat Sahakari Sakhar Karkhana Ltd. & other Versus The State of Maharashtra & Others, to which one of us (B.P. Dharmadhikari, J.) is party. Similar view is reached by other Division Bench at Bombay in 2013 (6) LJSOFT 3 Kolhapur Sugar Mills ltd. Vs. State of Maharashtra & ors., after considering the provisions contained Section 58A and 114 in Bombay Prohibition Act, 1949, Revised pay scales as per the Sixth Pay Commission were made applicable with retrospective effect from 1-1-2006 and direction was issued to recover the arrears. State Government is held entitled to recover the entire amount payable by way of salaries and allowances to the supervisory staff as per Section 58A. Cost of supervision may have been paid in advance but, there is no prohibition to claim the balance amount on account of retrospective application of wage revision. Fact that the petitioner cannot recover such amount demanded subsequently from the customers can not make the Section arbitrary or unconstitutional The decision in the case of Government of Maharashtra and Others v. M/s. Deokar's Distillery 2003 (4) LJSOFT (SC) 14 = 2003 (5) SCC 669 & earlier judgment in PolychemLimited and Another v. State of Maharashtra and Others (1998)6 SCC 196 are considered by this Court. Judgment of Hon'ble Apex Court in Government of Maharashtra and Others v. M/s. Deokar's Distillery (supra), is rendered by a larger bench of the Hon'ble Apex Court consisting of the three Hon'ble Judges and the decision in the case of Polychem Limited (supra), was of a bench consisting of the two Hon'ble Judges. The larger bench of the Hon'ble Apex Court has in terms held that the words "cost of such staff" used in Section 58A of the 1949 Act , will include the additional amounts which become recoverable on account of upward revision of pay scales of the supervisory staff with retrospective effect. In fact, the majority view in the judgment of Larger Bench in Paragraph No.77 holds that Polychem case was decided on the basis of a decision which was already overruled. The very object of Section 58A of the 1949 Act is, held to ensure that the licensee bears the entire cost of the supervisory staff employed by the State Government. The State Government is entitled











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