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1964 Supreme(P&H) 173
PUNJAB & HARYANA HIGH COURT
D.Falshaw and A.N.Grover JJ.
Karnal Distillery Co.Ltd.
Versus
State Of Punjab
Civil Writ No. 472 of 1964,
Decided On : OCTOBER 26, 1964
A notice determining a license cannot be kept in abeyance and revived later. Once the period fixed by the original notice has expired, a fresh valid notice has to be issued.
Headnote:
EXCISE - LICENCE - DETERMINATION - NOTICE - KEEPING IN ABEYANCE - VALIDITY - PUNJAB EXCISE ACT, 1914 (I OF 1914), SS. 8(A), 9, 21(B), 36 - TRANSFER OF PROPERTY ACT, 1882 (IV OF 1882), SS. 111(H), 113.
Fact of the Case:
The petitioner, a distillery company, challenged the validity of a notice issued by the Excise and Taxation Commissioner determining its license. The original notice issued in 1959 was kept in abeyance and revived in 1963, changing the date of determination of the license. The petitioner argued that the notice was invalid as it was not issued within a year from the date of service of the original notice.
Finding of the Court:
The court held that the notice issued in 1963 was invalid as the original notice had expired and could not be revived. The court relied on the provisions of the Transfer of Property Act, which provide that a notice determining a lease is waived if the landlord acts in a manner showing an intention to treat the lease as subsisting. The court also held that the notice was invalid as it was issued by the Excise and Taxation Commissioner, who was not the officer who granted the license.
Issues: 1. Whether the notice issued in 1963 was valid? 2. Whether the notice was invalid as it was issued by the Excise and Taxation Commissioner?
Ratio Decidendi: 1. The court held that the notice issued in 1963 was invalid as the original notice had expired and could not be revived. The court relied on the provisions of the Transfer of Property Act, which provide that a notice determining a lease is waived if the landlord acts in a manner showing an intention to treat the lease as subsisting. 2. The court also held that the notice was invalid as it was issued by the Excise and Taxation Commissioner, who was not the officer who granted the license.
Final Decision: The court quashed the notice issued in 1963 as being invalid.
1. This is a petition filed under Article 226 of the Constitution by a company the karnal Distillery Co, Ltd against the State of Punjab and Excise and Taxation Commissioner.
2. The petitioner is an old established distillery company which at present operating under a licence in the form D-2 granted by the Financial Commissioner on the 5th November 1941. It had a licence long before that. there seems to be no doubt that the distiller which is situated in the town of Karnal has long been regarded as a nuisance and for years the Government has been trying to have it removed to some place away from the town. Under the terms of the licence apart from the powers given to the Financial Commissioner may by notice in writing determine and the then Excise and Taxation Commissioner to whom the powers of the Financial Commissioner Act caused a notice copy annexure 3 dated the 4th of May 1959 to be served on the company under section 21(b) of the Excise Act and clause 9 of the licence determining he companys licence as from the 15 the of May 1960. However shortly before the year of notice was due to expire the Excise and taxation Commissioner sent the letter, copy annexure 4 on the 4th of May 1960 to the company when reads--
"It has been decided by Government that he notice issued under section 21(b) of the Punjab Excise Act(I of 1914) and condition No. 9 of the distillery licence in form D-2 held by the Karnal and served on the Managing Director for closure of the distillery on the 15th of May 1960 in case of its failure to shift from the present site should be kept in abeyance until further orders."
A further letter copy annexure 5, dated the 13th of August 1960 was issued in which a reference was made in the previous notice and its being placed in abeyance and the company was not confirmed that unless the distillery was moved to some place outside the municipal limits of Karnal the licence would be determined on the 25th of January 1961.
3. However the Government seems to have pursued a vacillatory policy in the matter and the letter, copy annexure 6 dated the 25th of January 1961 was sent to the company informing it that the notice terminating the licence was again being kept in abeyance. A further communication copy annexure 7 dated the 28th of August 1962 again informed the company that action with regard to shifting of the distillery from its present site was to be held in abeyance and another communication copy annexure 18, dated the 3rd November 1962 perhaps shows some light on the governments reasons for its apparent indecision in the matter. the main portion of this document reads--
"The shifting of the distillery has been held in abeyance till the phased program for the enforcement of prohibition in the State is worked out."
4. I do not propose to cite in detail the contents of the voluminous correspondence between the company and the Excise and Taxation Commissioner which has been annexed to the writ petition it being sufficient to say that the company was repeatedly explaining its difficulties in the matter of shifting the distillery else where without assistance from the Government in the form if acquiring a site and obtaining the necessary railway facilitates and it is clear that the Government had agreed to help the company by acquiring an alternative site for it and had actually gone so far as to select such a site and had issued notices under sections 4 and 6 of the Land Acquisition Act. This site was near the railway station at Rathdhana in the district of Rohatak. The correspondence was continuing regarding all these details and the advance payment by the company of the money required for the acquisition of the land when the communication copy annexure 2 dated the 19th of August 1963 was sent by the Excise and Taxation Commissioner to the company. It reads:
The notice issued under section 21(b) of the Punjab Excise Act, 1914,(I of 1914), and condition No. 9 of the licence in form D-2 held by you and served on
