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IN THE HIGH COURT OF KERALA
P.B. SURESH KUMAR, J.
Hotel Elegance - Petitioner
Vs.
State of Kerala - Respondent
Writ Petition (C) No. 22730 of 2016 (M)
Decided On : 18-10-2016
Beer Sale - Interpretation of Abkari Act and Foreign Liquor Rules - Rule 13(11), Rule 13(3B) - The court interpreted the provisions of Rule 13(11) and Rule 13(3B) of the Foreign Liquor Rules under the Abkari Act to determine whether the petitioner firm was entitled to sell beer for consumption outside the premises of their hotel. The court held that the conditions imposed on the licensees as per the terms of the licence are statutory in nature and must be strictly construed. It emphasized that the prohibition was on the permission for consumption outside the specified premises, not on the sale itself. The court also compared the provisions with those related to FL-3 licences, concluding that the absence of a similar prohibition in FL-11 licences indicated the rule makers' intent not to prohibit the sale of beer for consumption outside the hotel. The court allowed the writ petition, declaring that there is no prohibition on selling beer for consumption outside the premises of the licensees under FL-11 licences and directed the respondents to refrain from interfering with the sale of beer in bottles by the petitioner for consumption outside the hotel.
Fact of the Case:
The petitioner, a hotel firm, held a Beer and Wine Parlour licence and was accused of selling beer for consumption outside the hotel premises, contrary to the licence conditions. The petitioner sought directions to refrain from such interdiction by the authorities under the Abkari Act and the Foreign Liquor Rules.
Finding of the Court:
The court found that the conditions imposed on the licensees as per the terms of the licence are statutory in nature and must be strictly construed. It interpreted the provisions of the Foreign Liquor Rules to conclude that there is no prohibition on selling beer for consumption outside the premises of the licensees under FL-11 licences.
Issues: The main issue was whether the petitioner firm was entitled to sell beer for consumption outside the premises of their hotel under the FL-11 licence, considering the conditions imposed and the statutory nature of the rules.
Ratio Decidendi: The court's decision was based on the interpretation of the statutory provisions, emphasizing the strict construction of penal statutes and comparing the provisions related to FL-3 licences to determine the intent of the rule makers.
Final Decision: The court allowed the writ petition, declaring that there is no prohibition on selling beer for consumption outside the premises of the licensees under FL-11 licences and directed the respondents to refrain from interfering with the sale of beer in bottles by the petitioner for consumption outside the hotel.
P.B. Suresh Kumar, J.
The petitioner is a firm engaged in running a hotel. The petitioner firm holds a Beer and Wine Parlour licence in Form No. FL-11 of the Foreign Liquor Rules ("the Rules"), framed under the Abkari Act ("the Act"). Exhibit P1 is the licence in favour the petitioner. During June 2016, a crime was registered against the partners of the petitioner firm and others under Section 56(b) of the Act alleging that the petitioner firm had sold three bottles of beer to a person for consumption outside the hotel contrary to the condition imposed on them in that connection as per the terms of the licence. Exhibit P3 is the occurrence report in respect of the said crime. According to the petitioner, there is no prohibition in selling beer under the said licence for consumption outside the premises of the hotel and therefore, the authorities under the Act cannot interdict the same. The petitioner, therefore, seeks directions to the respondents to refrain from interdicting the petitioner from selling beer for consumption outside the premises of their hotel.
2. A statement has been filed on behalf of respondents. The stand taken in the statement is that a person holding licence in Form No.FL-11 of the Rules is not entitled to sell beer for consumption outside the premises of his hotel.
3. Heard the learned Senior Counsel for the petitioner as also the learned Senior Government Pleader.
4. The learned Senior Counsel for the petitioner asserted that the petitioner is not prohibited from selling beer for consumption outside the premises of their hotel under the licence issued to them. Per contra, the learned Senior Government Pleader asserted that condition No.2 in Form No. FL-11 licence prohibits such sale.
5. It is beyond dispute that the conditions imposed on the licensees as per the terms of the licence issued to them under the Rules are statutory in nature and its breach would invite penal consequences. It is fundamental that penal statutes must be strictly construed and if there is a reasonable interpretation which will avoid the penalty in a particular case, the courts are bound to adopt that construction. Licence in Form No.FL-11 is issued as provided for under Rule 13 (11) of the Rules. The said Rule reads thus;
"13(11) Foreign Liquor 11 Beer/Wine Parlour Licence - Beer/Wine Parlour licences in Form FL 11 shall be issued by the Commissioner of Excise under orders of Government to the hotels, motels, resorts and catering establishments owned and/or run by Kerala Tourism Development Corporation limited and to hotels having classification of three star, four star, five star and five star deluxe, heritage, heritage grand or heritage classic in such places where FL3 licence can be granted. FL-11 licence shall also be granted to the restaurants classified by Department of Tourism Government of Kerala, restaurants approved by Ministry of Tourism Government of India and hotels having one and two star classification of Ministry of Tourism, Government of India, in tourist centres approved by the Government in Taxes Department. The annual rental shall be Rs.4,00,000/- (rupees four lakhs only) for each Beer/Wine Parlour. The licensee shall procure Beer/Wine only from the FL9 licensee in the State. Beer/Wine shall be served to the public only in a separate room meant for the purpose. The maximum strength at which Beer/Wine shall be sold are at 6% v/v and 12% v/v respectively. Distance limit subscribed under sub-rule (1) and sub-rule (3) shall apply to this licenses.
Provided that the holder of an FL11 licence may serve beer/wine along with meals by the side of swimming pools and in the lawns and roof gardens of the hotel if he obtains a special permit for the purpose, from the Commissioner of Excise, on payment of an additional annual rental of Rs.50,000/- (Rupees fifty thousand only) or such additional annual rental as may be prescribed by the Government from time to time. Provided further that the holder of an FL11 licence may
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