Varghese Kalliath, J.

This Original Petition comes up for hearing before us on a reference by a learned single judge of this Court. His Lordship is of opinion that the Original Petition requires to be considered by a Division Bench, since certain questions of law arise in this Original Petition, the result of which will have far-reaching public importance.

2. Petitioners are the legal representatives of one Narayana Pillai, who was the successful bidder of 12 arrack shops in Kunnathur Range. The Assistant Excise Commissioner, Quilon conducted the auction on 27-3-1981. This was done in accordance with S.18A of the Abkari Act read with R.3(1) of the Kerala Abkari Shops (Disposal in auction) Rules, 1974 hereinafter referred to as the Act and the rules). The notification in the gazette for the conduct of the auction was on 7th March, 1981. It was in terms of R.4 of the Rules. Narayana Pillai was the highest bidder for the privilege of vending arrack in the 12 arrack shops in Kunnathur Range. The bid amount was Rs. 29,01,000/- It was for the year commencing from 1-4-1981 to 31-3-1982.

3. The auction purchaser deposited an amount of Rs.8,70,300/- representing 30% of the bid amount. He produced solvency certificate forRs.5,80,200/- representing 20% of the bid amount. A temporary agreement was executed.

4. The case of the petitioner is that though Narayana Filial was the highest bidder and he has satisfied all the preliminary requirements contemplated under the Rules, the Board of Revenue did not confirm the sale before the commencement of the period for which the privilege was auctioned. R.5(13) of the Rules provides that no sale shall be deemed final as against the Government unless confirmed by the Board of Revenue who shall be at liberty to accept or reject any bid for valid reason to be recorded in writing. Petitioners pointed out that every confirmation or rejection with reasons therefore of the sale shall be communicated to the auction purchaser in writing as soon as possible (see R.5(14) of the rules ). Considering the date of auction, the amount involved and the number of shops, the Board of Revenue ought to have confirmed the auction before the commencement of the abkari year, R.5(15) of the Rules provides for execution of a permanent agreement i n Form No. 11 and thereafter to take out necessary licence before installation of the shop or shops.

5. Section ISA of the Act provides for the grant of exclusive or other privilege of manufacture, etc. on payment of rentals, S.18A(i) (ii) and (iii) of the Act makes it clear that it shall be lawful for the Government to grant to any person or persons on such conditions and for such period as the Government may deem fit the exclusive or other privilege of selling by retail any liquor within any local area on payment to the Government an amount as rental in consideration of the grant of such privilege. It is further provided that the amount of rental may be settled by auction, negotiation or by any other method as may be determined by the Government from time to time and may be collected to the exclusion of, or in addition, to the duty or tax leviable under Ss.17 and 18 of the Act. S.18A(2) of the Act provides that no grantee of any privilege under sub-section (1) shall exercise the same until he has received a licence in that behalf from the Commissioner. S.24 of the Act prescribes the forms and conditions of licence. S.25 of the Act enjoins a person to execute a counterpart agreement in conformity with the tenor of his licence and to give such security for the performance of his agreement as the (Commissioner) may require. S.26 of the Act provides for power to recall licenses. Since S.18A(2) of the Act provides that no grantee of any privilege to seel liquor, shall exercise that privilege until he has received a licence as contemplated by the Act, the Original Petitioner, the auction purchaser could have exercised the privilege he has purchased by sale of liquor only after ob