Back
1978 Supreme(All) 717
HIGH COURT OF ALLAHABAD
M.B.Farooqui
MITHU LAL
Versus
DISTRICT MAGISTRATE
Decided On : 30 November 1978
Civil Misc. Writ Petition No. 792 of 1976 Connected with 26 other Writ Petitions of 1976, 1977 and 1978
The term 'bottle' in the context of fixed fee calculation for retail vendors of foreign liquor refers to a 'quart bottle' and not any bottle irrespective of its size.
Headnote:
{'KEYWORD': 'EXCISE DUTY', 'SUBJECT': 'Fixed Fee Calculation', 'ACT SECTION LIST': ['Uttar Pradesh Bottling of Foreign Liquor Rules, 1969'], 'SUMMARY': "The court interpreted the term 'bottle' in the context of fixed fee calculation for retail vendors of foreign liquor. It held that the term 'bottle' referred to a 'quart bottle' and not any bottle irrespective of its size. The court reasoned that the fixed fee was based on the quantity of liquor sold, not the number of bottles sold, and that the standard measure for noting the quantity sold was the quart."}
Fact of the Case:
Retail vendors of foreign liquor challenged the demand for additional fixed fee based on the audit objection that the fixed fee should be charged on the basis of bottles sold irrespective of their size.
Finding of the Court:
The court held that the fixed fee was payable for the number of bottles sold, but the bottles were to be treated as quart bottles. The court found that the audit objection was misconceived and the impugned demand based thereon was illegal.
Issues: Whether the fixed fee for retail vendors of foreign liquor was to be charged on the basis of bottles sold irrespective of their size.
Ratio Decidendi: The court interpreted the term 'bottle' in the context of fixed fee calculation for retail vendors of foreign liquor. It held that the term 'bottle' referred to a 'quart bottle' and not any bottle irrespective of its size. The court reasoned that the fixed fee was based on the quantity of liquor sold, not the number of bottles sold, and that the standard measure for noting the quantity sold was the quart.
Final Decision: The court allowed the writ petition and quashed the impugned demand of excess fixed fee demanded for the years 1974-75 and 1975-76.
The petitioners in this group of writ petition are retail vendors of foreign liquor operating either under a licence in Form F. L. 4 or Form F. L. 5. They paid the requisite fixed as well as assessed licence fees for the years 1974-75 and 1975-76. It appears that at the audit inspection of the Excise Department, the Accountant Generals office raised an objection that the fixed fee has not been adequately charged from the petitioners. When the audit objection came to the notice of the Excise Commissioner, he issued an order on or about June 22, 1976 indicating that in view of the audit objection fixed fee has to be charged on the basis of bottles sold irrespective of their size. This has to be in effect from March 24, 1972 till March 10, 1975 when the system would be of charging fixed fee in relation to quart bottles. Acting on this directive, the District Excise Officer issued an order requiring the petitioners to pay the difference. Being aggrieved, the petitioners have challenged this demand by way of the present writ petition.
By a notification dated March 27, 1974, the Excise Commissioner amended Rules 642, 653, 654 and 656 of the Rules in the Excise Manual. Rules 654 related to the licence-fee for the retail vend of foreign liquor in form F. L. 4 to F. L. 12. For different kinds of licences, it prescribed an assessed fee at different rates but at per reputed quart bottle sold. Rule 654 runs as under -
" (a) The fees for all sales made under a shop licence in form F. L. 4 consumption both on and off the premises shall be assessed according to the following scale :
1- Spirits, wines, liquors, cordial etc. of all kinds Rs. P 5-00 per reputed quart bottle
2. Beer, stout and other for-mented liquor 30 per reputed quart bottle.
(b) The fees for all sales made under a hotel or staging or dak bungalow licence (F. L. 6) or under a restaurant or hotel bar licence (F. L. 7) or under a beer bar licence (F. L. 7-A) or under a railway refreshment room or dining car licence (F. L. 8) or under a theatre or cinema bar licence (F. L. 12), shall be assessed according to the following scale :
Rs. p
1. Spirit, wines, liquors, cordials etc. of all kinds 4. 00 per reputed quart bottle
2. Beer, stout and other fomented liquor 0. 30 per reputed quart bottle.
(c) The fees for all sales made under a shop licence (F. L. 5) for consumption ff the premises shall be assessed according to the following scale :
L spirits, wines, liquors, cordials Rs. P etc. of all kinds 3. 00 per reputed quart bottle. 2. Beer stout and other fermented liquor 0. 10 per reputed quart bottle.
(d) The annual assessment of fees under sub-clauses (a), (b) and (c) shall be subject to the following minima :
Rs.
For "on and off" licence (F. L. 4) 2, 500 For "off" licence (F. L. 5) 500 For hotel licence (F. L. 6) 500
For restaurant and hotel bar licence (F. L. 7) 500 For Beer bar (F. L. 7) 250 For railway refreshment room and dining car licence
(F. L. 8) 250 For staging or dak bungalow licence (F. L. 6) 250 For Theatre, bar licence (F. L. 12) when taken for full Rs. P.
year 2, 500 For first class cities i. , 500 For second class cities 1, 000 Note-In the prohibition areas the Collector with previous sanction of the Excise Commissioner may fix minimum fees for an oif licence according to the volume of business likely to be transacted under the class of licence.
(e) In addition to the assessed fees mentioned above, at the following rates shall also be payable by the licencee in advance :
(i) F. L. 5, licence
Fixed fee for sales not exceeding 5000 bottle of spirits per annum
For sales exceeding 5,000 bottles per annum
Rs. 3,000 The fee increased by
shall be Rs. 2,000 (ii) F. L. 4. licence, F. L. 7 licence F. L. 8 licence and F. L. 12 licence
Fixed fee for sales not exceeding 5,000 bottle of spirits per annum
(iii) F. L. 6 licence (L) for hotels recognized by Tourist and Develop ment Department.
For sales exceeding 5,000 bottles per annum
Fixed fee for sales not exceed
