The central legal point established in the judgment is that the restrictions imposed by the Abkari Act, including S.18 (3) (2) (a) (i) and 18A, were reasonable and in the interests of the general public. The court also clarified that the rental collected under S.18A was not a tax or fee, but an incidental product of the regulatory measures aimed at controlling the sale and consumption of foreign liquor.

Headnote:
Abkari Act - Unconstitutional Challenge - S.18 (3) (2) (a) (i) and 18A - Summary of Acts and Sections: The court discussed the constitutional validity of S.18 (3) (2) (a) (i) and 18A of the Abkari Act,1 of 1077. The court examined the provisions of the Abkari Act, including the levy of duties of excise and luxury tax, the grant of exclusive privileges, and the issuance of licences for the sale of liquor. The court also considered the constitutional rights of citizens to carry on trade in liquor and the reasonableness of the restrictions imposed by the Act. The court held that the provisions were constitutional and dismissed the challenge.
Fact of the Case:

The petitioners sought to declare S.18 (3) (2) (a) (i) and 18A of the Abkari Act,1 of 1077 unconstitutional and to issue a writ of mandamus to direct the Commissioner of Excise to renew their licences for the sale of foreign liquor. The petitioners were holders of Foreign Liquor Wholesale licences for the year 1969-70, which expired on 31-3-1970.
Finding of the Court:

The court found that the provisions of the Abkari Act, including S.18 (3) (2) (a) (i) and 18A, were constitutional. The court held that the Act's primary purpose was to restrict and control the sale and consumption of foreign liquor, and the provisions were aimed at regulating the trade in liquor for the health and safety of society. The court also held that the rental collected under S.18A was not a tax or fee, but an incidental product of the regulatory measures.
Issues: The issues before the court included the constitutional validity of S.18 (3) (2) (a) (i) and 18A of the Abkari Act,1 of 1077, and whether the provisions imposed unreasonable restrictions on the petitioners' fundamental right to carry on trade in foreign liquor.
Ratio Decidendi: The court held that the restrictions imposed by the Abkari Act, including S.18 (3) (2) (a) (i) and 18A, were reasonable and in the interests of the general public. The court also found that the rental collected under S.18A was not a tax or fee, but an incidental product of the regulatory measures aimed at controlling the sale and consumption of foreign liquor.
Final Decision: The court dismissed the challenge to S.18 (3) (2) (a) (i) and 18A of the Abkari Act,1 of 1077, and held that the provisions were constitutional. The court also dismissed the petitions and made no order as to costs.

Judgment :-

1. The original petitions seek to declare S.18 (3) (2) a (i) and 18A of the Abkari Act,1 of 1077 and R.13 (1) substituted by SRO. 70/70 dated 18 21970 in the rules relating to licences for the sale of foreign liquor unconstitutional and for the issue of writ of mandamus to direct the Commissioner of Excise to renew the licences.

2. The petitioners were the holders of Foreign Liquor 1 Wholesable licences for sale of foreign liquor for the year 1969 70. The period of their licences expired on 31-3-1970.

3. The Cochin Abkari Act,1 of 1077 and the Travancore Abkari Act, IV of 1073 were continued in force by the Travancore-Cochin State Administration and Application of Laws Act VI of 1125. By S.2 of the Cochin Abkari (Extension and Amendment) Act, 1967 (Act 10 of 1967) the Cochin Abkari Act,1 of 1077 and the Rules, Orders and Notifications made and issued thereunder were extended to the areas of the State of Kerala where the said Act was not in force. S.5 amended the name of the Act as Abkari Act. S.41 repealed the Travancore Abkari Act, IV of 1073 as also the Madras Act,1 of 1886 as was in force in the Malabar area.

4. The Government of Travancore-Cochin by notification No. SR41859/ 52/ RD dated 17th January 1953 which came into force from April 1, 1953, prescribed revised rules under the Cochin Abkari Act 1 of 1077, in supersession of all earlier rules, on the subject, for the levy of gallonage fees etc., and for the issue of licences for the sale of foreign liquor. R.13 provided for the issue of six kinds of licences for sale of foreign liquor. It is sufficient for our discussion to note the first three kinds. They are:

(1) Foreign Liquor 1 Wholesale Licence (hereinafter referred to as F.L.1 licence).

(2) Foreign Liquor 2 Retail (Tavern) Licence (hereinafter referred to as F.L. 2 licence.)

(3) Foreign Liquor 3 Hotel (Restaurant) Licence (hereinafter referred to as FL. 3 licence).

Rule 13 (1) provided that F. L.1 licence would be issued by the Excise Commissioner for an annual fee of Rs. 3000/-; R.13 (2) provided that the privilege under F.L. 2 licence would be sold in public auction subject to the conditions of the sale notification published by Government from time to time; R.13 (3) provided for the issue of F.L. 3 licence by the Excise Commissioner on an annual fee of Rs. 2000/ .

5. Sub-rules (1) and (3) of R.13 were amended by notification SRO. 323/63 Rev. dated 25 31963 enhancing the fee for F.L. I licence to Rs. 5000/-and F.L. 3 licence to Rs. 3000/-. The amendment came into force from 1-4-1963. A holder of F.L. 3 licence contested the validity of SRO. 323/63 in proceedings under Art.226 of the Constitution. Vaidialingam J. declared the notification illegal and void. The decision is reported in Antony v. Excise Commissioner 1964 KLT.189. To get over the situation created by the decision, the Kerala Abkari Laws (Amendment and Validation) Ordinance 2 of 1964 was passed. This was followed by the Kerala Abkari Laws (Amendment and Validation) Act, 1964 (President's Act 1 of 1964) which came into force on 12 10 1964- These enactments apart from validating the notification SRO. 323/63 and the collections made thereunder, amended the provisions of the Cochin Abkari Act, 1077. It is enough for our purposes to note that S.18 (2) and (3) and I8A were introduced. S.18 (2) provided for the levy of luxury tax on liquor and intoxicating drugs; S.18 (3) fixed the rates of the duty of Excise and rates of the luxury tax and gallonage; S.18A provided for the grant of exclusive or other privilege of manufacture, sale, etc., of liquor or intoxicating drugs on payment of rentals.

6. It is necessary to remember that the rules framed under the Cochin Abkari Act,1 of 1077 including those for the levy of the gallonage fee and for the issue of licence for the sale of foreign liquor were by virtue of Act 10 of 1967 extended to the areas of Kerala State where the said rules were not in force.

7. S.18 (3) (2) (a) (i) of the Abkari Act(1 of 1077) fixed

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1970 Supreme(Ker) 62

Cases Referred (3)