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2025 Supreme(Mad) 3947

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
K. KUMARESH BABU, J.
Perumal Manamagil Mandram, represented by its Secretary, M. Jeyagurunathan - Petitioner 
Versus
The Commissioner of Prohibition of Excise, Chepauk, Chennai 600005 and Ors. – Respondents
W.P.(MD) No.27553 of 2024 and W.M.P. (MD) Nos.23366 and 23367 of 2024
Decided On : 31-01-2025 

Advocates Appeared:
For the Petitioner: Mr. Abudu Kumar Rajaratnam, Senior Counsel for Mr. F. Deepak.
For the Respondents:Mr. J.K. Jeyaseelan, Government Advocate, Mrs. M. Aasha, Government Advocate (Crl. side).

The denial of an FL2 license based on unfounded local objections was ruled as a colorable exercise of power, emphasizing that public interest and local need must substantiate any objections to license applications.

Headnote:(A) Tamil Nadu Liquor (License and Permit) Rules, 1981 - Rule 19-A - Writ petition challenging the denial of an FL2 license for a recreational club - The petitioner, a registered society, sought an FL2 license, but was denied based on objections citing local public interest and law and order concerns. However, similar licenses had been granted to nearby clubs under comparable circumstances. The court found the reasons for denial to be a colorable exercise of power, allowing the writ petition. (Paras 2, 5, 11, 14)

(B) License Granting Authority - The court emphasized that objections must substantiate local need and public interest, neither of which were applicable to the petitioner’s case. (Paras 12, 13)

Facts of the case:
The petitioner operates a recreational club and applied for an FL2 license. Despite receiving a 'No Objection Certificate', the license was denied based on an objection from a local councilor.

Findings of Court:
The court determined that the denial was unjustified since similar establishments had received licenses. The recommendation against the petitioner was based on unsound reasoning.

Issues: The court addressed whether the denial of the license was justified in light of similar precedents.

Ratio Decidendi: The court ruled that the reasons for denial were baseless and did not align with legal standards, allowing re-evaluation of the license application.

Result: Writ petition allowed with directions to reconsider the application.

Table of Content
1. petitioner challenges refusal of license application. (Para 2 , 3)
2. complaints influenced negative recommendation. (Para 4 , 5)
3. government's objection cited as basis for denial. (Para 6 , 7)
4. court examines validity of public objections. (Para 8 , 9 , 10 , 11)
5. application of specific licensing rules discussed. (Para 12 , 13)
6. court directs reconsideration of license application. (Para 14)

ORDER :

(K. KUMARESH BABU, J.)

Heard Mr.Abudu Kumar Rajaratnam Senior Counsel for Mr.F.Deepak, learned counsel for the petitioner, Mr.J.K.Jeyaseelan, learned Government Advocate for the respondents 1 to 3 and Mrs.M.Aasha, learned Government Advocate (Crl.side) for the fourth respondent.

2. The writ petition has been filed challenging the order passed by the first respondent in Na.Ka.No.Madhu.2/423661/2022 dated 13.07.2024 and for the consequential direction to the first respondent to grant FL2 license for the petitioner's recreational club, namely, Perumal Manamagil Mandram situated in Door No.456A, Masthanpatti, Vandiyur Bypass, Madurai under the Tamil Nadu Liquor (License and Permit) Rules, 1981.

3. The learned Senior Counsel appearing for the petitioner would submit that the petitioner is a Society registered under the Tamil Nadu Societies Registration Act, 1975 and for the benefit of its members, it is also running a recreational club. The petitioner had made an application for grant of FL2 license for the benefit of the members of the petitioner's club. A 'No Objection Certificate' had also been issued by the jurisdictional Inspector of Police. Since there was a delay in issuance of 'No Objection Certificate' from the first respondent, the petitioner had approached this Court seeking direction to the respondents to dispose of the application of the petitioner, in which a direction was issued by this Court on 04.07.2024 to pass suitable orders on the application pending with him.

4. In the interregnum, an alleged complaint had been made by a third party and an enquiry into such allegation was made by the fifth respondent, who had found that there was no person as named in the complaint. However, the second respondent relying upon the very same objection raised by the fictitious persons seems to have given a negative recommendation for the grant of FL2 license in favour of the petitioner. Such recommendation made by the second respondent to the first respondent is the subject matter of challenge in this writ petition. According to him, the report of the second respondent suggests that there is a bus- stand, school, hospital and residential buildings near the place of the petitioner's club and the same is also adjoining the Highways Department.

5. He would submit that in the very same locality, two other clubs, who predominantly operate the Bars, have been granted with FL2 licenses and they are currently in operation. Hence, the reasons assigned by the second respondent that based on the objections raised by the residents of the locality, particularly by a 40th Ward Member, the petitioner's club cannot be granted with the FL2 license is a creation. He would further submit that such recommendation is a non-est recommendation in the light of the permission granted to other clubs, who predominantly run Bars in the very same locality, having the same disadvantages, which are sought to be shown for the petitioner. Therefore, he would pray this Court to set aside the recommendations made by the second respondent and consequently direct the first respondent to grant the FL2 license to the petitioner club.

6. Countering his arguments, Mr.J.K.Jeyaseelan, learned Government Advocate appearing on behalf of the respondents 1 to 3 on the strength of the counter affidavit filed by the second respondent would submit that the request of the petitioner cannot be considered in view of the objections received from the general public and specifically, the objection letter received from the Councilor of the 40th Ward of Madurai Corporation. H

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