Rajasthan High Court
V. P. TYAGI
Mangilal - Appellant
Versus
District Excise Officer, Ajmer - Respondent
Civil Writ Petn. No. 13 of 1970
Decided On : 03/02/1970
EXCISE - Suspension of license - Order of suspension passed without giving opportunity to the licensee to state his case - Order quashed - Principles of natural justice - Violation.
Fact of the Case:
The petitioner, a liquor licensee, challenged the order of the District Excise Officer suspending his license for allegedly selling adulterated liquor. The petitioner argued that the order was passed without giving him an opportunity to state his case, violating the principles of natural justice.
Finding of the Court:
The court held that the order of suspension was a penalty imposed on the petitioner and not an administrative order to facilitate an enquiry for cancellation of the license. The court found that the Department had not taken a decision to cancel the petitioner's license before passing the suspension order and that the suspension was intended as punishment.
Issues: Whether the order of suspension of the petitioner's license was a penalty or an administrative order.
Ratio Decidendi: The court held that the order of suspension was a penalty imposed on the petitioner and not an administrative order to facilitate an enquiry for cancellation of the license. The court found that the Department had not taken a decision to cancel the petitioner's license before passing the suspension order and that the suspension was intended as punishment. The court also held that the order of suspension was passed without giving the petitioner an opportunity to state his case, violating the principles of natural justice.
Final Decision: The court quashed the order of suspension and awarded costs to the petitioner.
ORDER :- This writ application under Article 226 of the Constitution has been filed by petitioner Mangilal to challenge the order of the District Excise Officer, Ajmer dated 19th December, 1969, suspending the petitioner's license granted to him under the Rajasthan Excise Act, 1950.
2. The case of the petitioner is as follows :
3. The petitioner was given a license under the Rajasthan Excise Act, 1950 (hereinafter called the Act) for carrying on the business of selling country liquor in the town of Beawar. This license was granted for a period commencing from 1-4-1969 to 31-3-1970. It is alleged that the petitioner by filing a separate writ application before this Court had challenged the guarantee system on which the licenses were granted in the State by the Excise authorities for the sale of country liquor and that writ petition was admitted by this Court. This action of the petitioner resulted in the straining of the relations between the petitioner and the Excise Officers and it is said that it is out of a revengeful spirit that the respondents were out to find faults with the petitioner and to punish him. On 17-12-1969 the Inspector of the Excise Department came for the inspection of the petitioner's shop and it is said that he seized the entire stock from the petitioner's shop at Beawar and after two days the District Excise Officer suspended the petitioner's license on the alleged ground that the liquor in 127 bottles was found in the petitioner's short which was not in conformity with the prescribed standard. This order has been placed on the record as Ex. 1. It is further alleged that the petitioner personally met the District Excise Officer and represented to him that the action taken against him was prompted by mala fides and revengeful spirit due to the action taken by him in the High Court to challenge the guarantee system introduced by the Department, but in spite of his efforts he could not get back the stock seized by the Department and it is said that the Department has arranged for the sale of the petitioner's stock of liquor on commission basis. This action of the Department has been challenged by the petitioner, inter alia, on the grounds that the respondent No. 1 was actuated to take such a drastic action against the petitioner out of a revengeful spirit and that the order of suspension of license has been passed without observing the rules of natural justice inasmuch as the respondent No. 1 did not give any opportunity to the petitioner to state his case and prove his innocence before suspending his license. According to the petitioner, the suspension of the license is a punishment and it can be inflicted only when the licensee is found guilty of the violation of the conditions of his license or contravention of the provisions of the Act or any rules, orders or notifications issued under the Act. The petitioner's case is that the pre-requisite condition for the suspension of a license is the recording of a finding by the authorities about the guilt of the petitioner and such a finding could be given only after the petitioner was afforded an opportunity to state and prove his case before the authorities who wanted to punish him. In these circumstances, this writ application has been filed with a prayer that the order of suspension (Ex. 1) be quashed.
4. A reply has been filed on behalf of the respondents wherein the allegations of mala fide intention of the respondent have been vehemently opposed by the respondents. It is averred in their reply that the action of the petitioner of selling adulterated liquor and that too in loose bottles was against the terms of the license, specially conditions Nos. 6, 15, 19 and 24 which entailed the cancellation of the petitioner's license. It is further averred that the Inspector who had gone for the checking of the shop detected by means of hydrometer as many as 127 bottles of liquor of much below the prescribed strength and these bottles were seized in the prese
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