H.L. Dattu, C.J.

The core issue in these appeals filed by the State of Kerala and the Original Petitions filed by the licensees who were issued with licences under the provisions of the Kerala Abkari Act read with Kerala Abkari Shops (Disposal in Auction) Rules, 1974 is, as to whether it is permissible for the State Legislature to enact a provision for the forfeiture of the whole or any portion of the kist deposited by persons who purchased the right to sell toddy, arrack, foreign liquor or ganja in addition to damages recoverable by the Government on account of the breach of conditions of sale laid down by the Government from time to time.

2. The law we are concerned with is, the provisions of the Kerala Abkari Act and the Kerala Abkari Shops (Disposal in Auction) Rules 1974. The statutory provisions which we are required to interpret in these appeals are Section 29(2)(r) of the Abkari Act and Rule 6 (28) of the Abkari Shops (Disposal in Auction) Rules.

3. The source of power for the State Government to make the laws in regard to intoxicating liquors is traceable to Entry 8 of List II of Schedule VII to the Constitution of India which provides for intoxicating liquor,