PATNA HIGH COURT
N.Pandey and R.K.Sarkar JJ.
Arun Kumar
Versus
State Of Bihar
Civil Writ Jurisdiction Case No. 2076 of 1997 ;
Decided On : MAY 14, 1997
BIHAR EXCISE ACT, 1915 - SECTION 38, 90(7), 92, 100 - SETTLEMENT OF RETAIL VENDS OF COUNTRY SPIRIT - CONDITION 19(GA) OF NOTIFICATION DATED 25TH JANUARY, 1997 - VALIDITY - ADDITIONAL LICENSE FEE FOR LIFTING COUNTRY LIQUOR IN EXCESS OF 30% OF MINIMUM QUOTA - INTERPRETATION AND APPLICATION.
Fact of the Case:
Petitioners, licensees under the Bihar Excise Act, challenged the validity of condition 19(ga) of the notification dated 25th January, 1997, issued by the Commissioner of Excise and Prohibition, which required licensees to pay an additional license fee for lifting country liquor in excess of 30% of the minimum quota.
Finding of the Court:
The court held that the condition was not illegal or ultra vires to the provisions of Rule 100, as it was one of the conditions for settlement, requiring the licensee to pay the additional amount if they intended to lift liquor in excess of 50 percent to the fixed minimum guarantee note.
Issues: 1. Whether condition 19(ga) of the notification dated 25th January, 1997, was illegal or ultra vires to the provisions of Rule 100? 2. Whether the additional license fee for lifting country liquor in excess of 30% of the minimum quota was arbitrary or unreasonable?
Ratio Decidendi: 1. The State has the exclusive right or privilege of manufacture or sale of intoxicants and can prescribe suitable terms and conditions for settlement of such shops. 2. The amount charged from a licensee is not a fee nor indeed a tax but is in the nature of the price of a privilege, which a purchaser has to pay in any trade or business transaction. 3. The State can charge additional revenue for lifting liquor beyond 30 percent of the minimum guarantee quota.
Final Decision: The court rejected the petitioners' prayer for quashing condition 19(ga) of the tender notice but directed the Excise Commissioner to reconsider the matter before taking steps for future settlement/renewal to avoid variations in the rate of additional charges.
N. PANDEY, RK. SARKAR, J.
1. These writ petitions have been filed for quashing condition No.19 (ga) of the notification dated 25th January, 1997, issued under F-127 of the Bihar Excise act, 1915, by the Commissioner of Excise and Prohibition (respondent No.3)and also the sale notifications contained in Annexures 9, 1, 6 and 1 of CWJC nos.1530, 1825, 2151 and 2076 of 1997, respectively, published by the concerned collectors for settlement of different retail vends of country spirit on auction basis for the current year. Since facts and points involved in these cases are common, therefore, with the consent of parties, they have been heard together and are being disposed of by this order at the sage of admission itself.
2. Petitioner are licensees under the provisions of Bihar Excise Act to deal with country spirit at respective places. Admittedly, since last few years, settlement of such shops are being made on auction basis. The Excise Commissioner (respondent No.3)to make settlement of different retail vends for the year 1997-98, after having obtained approval of the Board of Revenue, issued direction vide his letter dated 25th november, 1997, along with a copy of sale notification under F-127, asking all the Collectors/deputy Commissioners of this State to take steps for settlement on the terms and conditions stipulated in the notifications.
3. As noticed above, petitioners are only aggrieved due to insertion of clause 19 (ga) to the sale notification which inter alia, provides that in case a licensee intends to lift country liquor in excess of more than 30% of the minimum quantity of quota for a particular month, such licensees will be required to pay proportionate licence fee on the excess quantity in addition to the fee already paid.
4. It appears on receipt of the said notification petitioners,of course, submitted their applications and also participated at the time of auction sale but filed representations before the Commissioner of Excise (respondent No.3)stating that impugned clause 19 (ga)was quite arbitrary unreasonable and not even workable. The Assistant Commissioner of Excise (respondent No.5)had also vide his letter dated 7th february, 1977, while submitting comments regarding queries made by the commissioner with respect to representations of the petitioners, pointed out that because of introduction of the impugned condition, 19 (ga)" the policy of the department is bound to adversely affect. Because, there will always be a scope of sale of illicit liquor. Anticipating practical complications and workable state of affairs, he also pointed out that in case such situation is allowed to continue a dealer of a particular vend of one of the mohalla of the same town, will have to pay additional charge of more than Rs.22.66 per LPL whereas other vend at the rate of Rs.2.80. Similar details with regard to other shops were also given.
5. It was further pointed out that with respect to shops located in Patna town, the Collector of the district had also informed the Commissioner by letter dated 26th March, 1997, that condition No.19 (ga) has in fact created anamolous situation. According to the learned Collector, if such a situation is to continue, there may be chances of supply of illegal liquor in large scale and, therefore, there will be loss of revenue to the State.
6. Mr. Shreenath Singh, Senior counsel, pointed out that apart from the anomalies which have been noticed in the foregoing paragraphs, learned Excise Commissioner had in fact no sanction of law to insert such a condition in the sale notification. Because as under Rule 100 of the rules under the bihar Excise Act, fee or amount of licence for a retail vend is to be fixed by auction-cum-tender subject to reserve fee or amount sanctioned by the Excise commissioner. But with respect to the subsequent year, renewal of settlement shall be subject to payment of such fee at the enhanced rate fix by the Excise commissioner. Therefore, it was not open to respo
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